diff --git a/drivers/gpu/drm/i915/display/intel_psr.c b/drivers/gpu/drm/i915/display/intel_psr.c
index d9a395c486d3..7daed098fa74 100644
--- a/drivers/gpu/drm/i915/display/intel_psr.c
+++ b/drivers/gpu/drm/i915/display/intel_psr.c
@@ -1269,8 +1269,8 @@ int intel_psr2_sel_fetch_update(struct intel_atomic_state *state,
 				struct intel_crtc *crtc)
 {
 	struct intel_crtc_state *crtc_state = intel_atomic_get_new_crtc_state(state, crtc);
+	struct drm_rect pipe_clip = { .x1 = 0, .y1 = -1, .x2 = INT_MAX, .y2 = -1 };
 	struct intel_plane_state *new_plane_state, *old_plane_state;
-	struct drm_rect pipe_clip = { .y1 = -1 };
 	struct intel_plane *plane;
 	bool full_update = false;
 	int i, ret;
@@ -1282,9 +1282,17 @@ int intel_psr2_sel_fetch_update(struct intel_atomic_state *state,
 	if (ret)
 		return ret;
 
+	/*
+	 * Calculate minimal selective fetch area of each plane and calculate
+	 * the pipe damaged area.
+	 * In the next loop the plane selective fetch area will actually be set
+	 * using whole pipe damaged area.
+	 */
 	for_each_oldnew_intel_plane_in_state(state, plane, old_plane_state,
 					     new_plane_state, i) {
-		struct drm_rect *sel_fetch_area, temp;
+		struct drm_rect src, damaged_area = { .x1 = 0, .y1 = -1, .x2 = INT_MAX, .y2 = -1 };
+		struct drm_mode_rect *damaged_clips;
+		u32 num_clips, j;
 
 		if (new_plane_state->uapi.crtc != crtc_state->uapi.crtc)
 			continue;
@@ -1300,23 +1308,89 @@ int intel_psr2_sel_fetch_update(struct intel_atomic_state *state,
 			break;
 		}
 
-		if (!new_plane_state->uapi.visible)
-			continue;
+		drm_rect_convert_16_16_to_regular(&new_plane_state->uapi.src, &src);
+		damaged_clips = drm_plane_get_damage_clips(&new_plane_state->uapi);
+		num_clips = drm_plane_get_damage_clips_count(&new_plane_state->uapi);
 
 		/*
-		 * For now doing a selective fetch in the whole plane area,
-		 * optimizations will come in the future.
+		 * If visibility or plane moved, mark the whole plane area as
+		 * damaged as it needs to be complete redraw in the new and old
+		 * position.
 		 */
+		if (new_plane_state->uapi.visible != old_plane_state->uapi.visible ||
+		    !drm_rect_equals(&new_plane_state->uapi.dst,
+				     &old_plane_state->uapi.dst)) {
+			damaged_area.y1 = old_plane_state->uapi.src.y1 >> 16;
+			damaged_area.y1 = old_plane_state->uapi.src.y2 >> 16;
+			damaged_area.y1 += old_plane_state->uapi.dst.y1;
+			damaged_area.y2 += old_plane_state->uapi.dst.y1;
+			clip_area_update(&pipe_clip, &damaged_area);
+
+			num_clips = 0;
+			damaged_area.y1 = src.y1;
+			damaged_area.y2 = src.y2;
+		} else if (new_plane_state->uapi.alpha != old_plane_state->uapi.alpha) {
+			num_clips = 0;
+			damaged_area.y1 = src.y1;
+			damaged_area.y2 = src.y2;
+		} else if (!num_clips &&
+			   new_plane_state->uapi.fb != old_plane_state->uapi.fb) {
+			/*
+			 * If the plane don't have damage areas but the
+			 * framebuffer changed, mark the whole plane area as
+			 * damaged.
+			 */
+			damaged_area.y1 = src.y1;
+			damaged_area.y2 = src.y2;
+		}
+
+		for (j = 0; j < num_clips; j++) {
+			struct drm_rect clip;
+
+			clip.y1 = damaged_clips[j].y1;
+			clip.y2 = damaged_clips[j].y2;
+			clip_area_update(&damaged_area, &clip);
+		}
+
+		if (!drm_rect_intersect(&damaged_area, &src))
+			continue;
+
+		damaged_area.y1 += new_plane_state->uapi.dst.y1;
+		damaged_area.y2 += new_plane_state->uapi.dst.y1;
+		clip_area_update(&pipe_clip, &damaged_area);
+	}
+
+	if (full_update)
+		goto skip_sel_fetch_set_loop;
+
+	/*
+	 * Now that we have the pipe damaged area check if it intersect with
+	 * every plane, if it does set the plane selective fetch area.
+	 */
+	for_each_oldnew_intel_plane_in_state(state, plane, old_plane_state,
+					     new_plane_state, i) {
+		struct drm_rect *sel_fetch_area, inter, src;
+
+		if (new_plane_state->uapi.crtc != crtc_state->uapi.crtc ||
+		    !new_plane_state->uapi.visible)
+			continue;
+
+		inter = pipe_clip;
+		if (!drm_rect_intersect(&inter, &new_plane_state->uapi.dst))
+			continue;
+
+		drm_rect_convert_16_16_to_regular(&new_plane_state->uapi.src, &src);
+
 		sel_fetch_area = &new_plane_state->psr2_sel_fetch_area;
-		sel_fetch_area->y1 = new_plane_state->uapi.src.y1 >> 16;
-		sel_fetch_area->y2 = new_plane_state->uapi.src.y2 >> 16;
+		sel_fetch_area->y1 = inter.y1 - new_plane_state->uapi.dst.y1;
+		sel_fetch_area->y2 = inter.y2 - new_plane_state->uapi.dst.y1;
+		sel_fetch_area->x1 = src.x1;
+		sel_fetch_area->x2 = src.x2;
 
-		temp = *sel_fetch_area;
-		temp.y1 += new_plane_state->uapi.dst.y1;
-		temp.y2 += new_plane_state->uapi.dst.y2;
-		clip_area_update(&pipe_clip, &temp);
+		drm_rect_intersect(sel_fetch_area, &src);
 	}
 
+skip_sel_fetch_set_loop:
 	psr2_man_trk_ctl_calc(crtc_state, &pipe_clip, full_update);
 	return 0;
 }
