diff --git a/services/core/java/com/android/server/wm/ActivityRecord.java b/services/core/java/com/android/server/wm/ActivityRecord.java
index aea944cd52d36..2646664649c55 100644
--- a/services/core/java/com/android/server/wm/ActivityRecord.java
+++ b/services/core/java/com/android/server/wm/ActivityRecord.java
@@ -3582,7 +3582,7 @@ final class ActivityRecord extends WindowToken implements WindowManagerService.A
     }
 
     /**
-     * @return {@code true} if the activity windowing mode is not
+     * @return {@code true} if the activity windowing mode is not in
      *         {@link android.app.WindowConfiguration#WINDOWING_MODE_PINNED} and a) activity
      *         contains windows that have {@link LayoutParams#FLAG_SHOW_WHEN_LOCKED} set or if the
      *         activity has set {@link #mShowWhenLocked}, or b) if the activity has set
@@ -7525,7 +7525,7 @@ final class ActivityRecord extends WindowToken implements WindowManagerService.A
     /**
      * Determines whether this ActivityRecord can turn the screen on. It checks whether the flag
      * {@link ActivityRecord#getTurnScreenOnFlag} is set and checks whether the ActivityRecord
-     * should be visible depending on Keyguard and window state.
+     * should be visible depending on Keyguard state.
      *
      * @return true if the screen can be turned on, false otherwise.
      */
@@ -7534,7 +7534,7 @@ final class ActivityRecord extends WindowToken implements WindowManagerService.A
             return false;
         }
         final Task stack = getRootTask();
-        return stack != null && !stack.inMultiWindowMode()
+        return stack != null
                 && mStackSupervisor.getKeyguardController().checkKeyguardVisibility(this);
     }
 
diff --git a/services/core/java/com/android/server/wm/KeyguardController.java b/services/core/java/com/android/server/wm/KeyguardController.java
index 71eb18ca4117f..554273cfdcd63 100644
--- a/services/core/java/com/android/server/wm/KeyguardController.java
+++ b/services/core/java/com/android/server/wm/KeyguardController.java
@@ -16,6 +16,7 @@
 
 package com.android.server.wm;
 
+import static android.app.WindowConfiguration.WINDOWING_MODE_FULLSCREEN;
 import static android.os.Trace.TRACE_TAG_WINDOW_MANAGER;
 import static android.view.Display.DEFAULT_DISPLAY;
 import static android.view.WindowManager.TRANSIT_FLAG_KEYGUARD_GOING_AWAY_NO_ANIMATION;
@@ -163,7 +164,7 @@ class KeyguardController {
 
         if (keyguardChanged) {
             // Irrelevant to AOD.
-            dismissDockedStackIfNeeded();
+            dismissMultiWindowModeForTaskIfNeeded(null /* currentTaskControllsingOcclusion */);
             setKeyguardGoingAway(false);
             if (keyguardShowing) {
                 mDismissalRequested = false;
@@ -328,8 +329,12 @@ class KeyguardController {
 
     /**
      * Called when occluded state changed.
+     *
+     * @param currentTaskControllingOcclusion the task that controls the state whether keyguard
+     *      should be occluded. That is the task to be shown on top of keyguard if it requests so.
      */
-    private void handleOccludedChanged(int displayId) {
+    private void handleOccludedChanged(
+            int displayId, @Nullable Task currentTaskControllingOcclusion) {
         // TODO(b/113840485): Handle app transition for individual display, and apply occluded
         // state change to secondary displays.
         // For now, only default display fully supports occluded change. Other displays only
@@ -353,7 +358,7 @@ class KeyguardController {
                 mService.continueWindowLayout();
             }
         }
-        dismissDockedStackIfNeeded();
+        dismissMultiWindowModeForTaskIfNeeded(currentTaskControllingOcclusion);
     }
 
     /**
@@ -414,20 +419,31 @@ class KeyguardController {
         }
     }
 
-    private void dismissDockedStackIfNeeded() {
+    private void dismissMultiWindowModeForTaskIfNeeded(
+            @Nullable Task currentTaskControllingOcclusion) {
         // TODO(b/113840485): Handle docked stack for individual display.
-        if (mKeyguardShowing && isDisplayOccluded(DEFAULT_DISPLAY)) {
-            // The lock screen is currently showing, but is occluded by a window that can
-            // show on top of the lock screen. In this can we want to dismiss the docked
-            // stack since it will be complicated/risky to try to put the activity on top
-            // of the lock screen in the right fullscreen configuration.
-            final TaskDisplayArea taskDisplayArea = mRootWindowContainer
-                    .getDefaultTaskDisplayArea();
-            if (!taskDisplayArea.isSplitScreenModeActivated()) {
-                return;
-            }
+        if (!mKeyguardShowing || !isDisplayOccluded(DEFAULT_DISPLAY)) {
+            return;
+        }
+
+        // Dismiss split screen
+
+        // The lock screen is currently showing, but is occluded by a window that can
+        // show on top of the lock screen. In this can we want to dismiss the docked
+        // stack since it will be complicated/risky to try to put the activity on top
+        // of the lock screen in the right fullscreen configuration.
+        final TaskDisplayArea taskDisplayArea = mRootWindowContainer.getDefaultTaskDisplayArea();
+        if (taskDisplayArea.isSplitScreenModeActivated()) {
             taskDisplayArea.onSplitScreenModeDismissed();
         }
+
+        // Dismiss freeform windowing mode
+        if (currentTaskControllingOcclusion == null) {
+            return;
+        }
+        if (currentTaskControllingOcclusion.inFreeformWindowingMode()) {
+            currentTaskControllingOcclusion.setWindowingMode(WINDOWING_MODE_FULLSCREEN);
+        }
     }
 
     private void updateKeyguardSleepToken() {
@@ -559,7 +575,7 @@ class KeyguardController {
             }
 
             if (lastOccluded != mOccluded) {
-                controller.handleOccludedChanged(mDisplayId);
+                controller.handleOccludedChanged(mDisplayId, task);
             }
         }
 
diff --git a/services/tests/wmtests/src/com/android/server/wm/ActivityRecordTests.java b/services/tests/wmtests/src/com/android/server/wm/ActivityRecordTests.java
index dd85484605d15..d3ddb438664e7 100644
--- a/services/tests/wmtests/src/com/android/server/wm/ActivityRecordTests.java
+++ b/services/tests/wmtests/src/com/android/server/wm/ActivityRecordTests.java
@@ -1668,7 +1668,7 @@ public class ActivityRecordTests extends WindowTestsBase {
     }
 
     @Test
-    public void testCanTurnScreenOn() {
+    public void testFullscreenWindowCanTurnScreenOn() {
         mStack.setWindowingMode(WINDOWING_MODE_FULLSCREEN);
         doReturn(true).when(mActivity).getTurnScreenOnFlag();
 
@@ -1676,11 +1676,11 @@ public class ActivityRecordTests extends WindowTestsBase {
     }
 
     @Test
-    public void testFreeformWindowCantTurnScreenOn() {
+    public void testFreeformWindowCanTurnScreenOn() {
         mStack.setWindowingMode(WINDOWING_MODE_FREEFORM);
         doReturn(true).when(mActivity).getTurnScreenOnFlag();
 
-        assertFalse(mActivity.canTurnScreenOn());
+        assertTrue(mActivity.canTurnScreenOn());
     }
 
     @Test