diff --git a/docs/examples/evals-sdk/tool_simulator.py b/docs/examples/evals-sdk/tool_simulator.py
new file mode 100644
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+++ b/docs/examples/evals-sdk/tool_simulator.py
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+from typing import Dict, Any
+
+from strands import Agent
+from strands.tools.decorator import tool
+from strands_evals import Case, Experiment
+from strands_evals.evaluators import HelpfulnessEvaluator
+from strands_evals.simulation.tool_simulator import ToolSimulator
+from strands_evals.mappers import StrandsInMemorySessionMapper
+from strands_evals.telemetry import StrandsEvalsTelemetry
+
+# Clear previous registrations
+ToolSimulator.clear_registry()
+
+# Setup telemetry and tool simulator upfront
+telemetry = StrandsEvalsTelemetry().setup_in_memory_exporter()
+memory_exporter = telemetry.in_memory_exporter
+tool_simulator = ToolSimulator()
+
+# Function tool for room temperature and humidity
+@ToolSimulator.function_tool(
+    share_state_id="room_environment",
+    initial_state_description="Room environment: temperature 68°F, humidity 45%, HVAC off"
+)
+def get_room_temperature_humidity() -> Dict[str, Any]:
+    """Get current room temperature and humidity levels."""
+    pass
+
+# MCP tool (shares state with room environment)
+hvac_schema = {
+    "name": "hvac_controller",
+    "description": "Control home heating/cooling system that affects room temperature and humidity",
+    "inputSchema": {
+        "type": "object",
+        "properties": {
+            "temperature": {"type": "number", "description": "Target temperature in Fahrenheit"},
+            "mode": {"type": "string", "enum": ["heat", "cool", "auto", "off"], "description": "HVAC mode"}
+        },
+        "required": ["temperature", "mode"]
+    }
+}
+
+@ToolSimulator.mcp_tool(
+    schema=hvac_schema, 
+    share_state_id="room_environment"
+)
+def hvac_controller(temperature: float, mode: str) -> Dict[str, Any]:
+    """Control home HVAC system."""
+    pass
+
+# API tool
+@ToolSimulator.api_tool(
+    path="/weather/current",
+    method="GET"
+)
+def weather_service(location: str) -> Dict[str, Any]:
+    """Get current weather information."""
+    pass
+
+# Create sub-agent (agent-as-tool) with simulated tools
+@tool
+def hvac_control_assistant(query: str) -> str:
+    """HVAC control assistant that uses room sensors and weather data to control the HVAC system based on user requests."""
+    try:
+        temp_tool = tool_simulator.get_tool("get_room_temperature_humidity")
+        hvac_tool = tool_simulator.get_tool("hvac_controller")
+        weather_tool = tool_simulator.get_tool("weather_service")
+        
+        control_agent = Agent(
+            system_prompt="You are an HVAC control assistant. Your job is to control the HVAC system using the hvac_controller tool based on information from room temperature/humidity sensors and weather conditions. Always check current room conditions first, consider outdoor weather, then make appropriate HVAC adjustments to meet the user's request.",
+            tools=[temp_tool, hvac_tool, weather_tool],
+            callback_handler=None,
+        )
+        response = control_agent(f"HVAC control request: {query}")
+        return str(response)
+
+    except Exception as e:
+        return f"HVAC control assistant error: {str(e)}"
+
+# Define a task function
+def user_task_function(case: Case) -> dict:
+    # Create agent with simulated tool and sub-agent
+    temp_tool = tool_simulator.get_tool("get_room_temperature_humidity")
+    
+    # Inspect initial shared state "room_environment"
+    initial_state = tool_simulator.get_state("room_environment")
+    print(f"[Room state (before agent invocation)]:")
+    print(f"  Initial state: {initial_state.get('initial_state')}")
+    print(f"  Previous calls: {initial_state.get('previous_calls', [])}")
+    
+    # Showcase how user-agent interaction changes room environment state
+    agent = Agent(
+        trace_attributes={"gen_ai.conversation.id": case.session_id, "session.id": case.session_id},
+        system_prompt="You are a smart home assistant Alessa. You can check room temperature and humidity conditions. For temperature adjustments, you must consult the hvac_control_assistant who has access to the HVAC system.",
+        tools=[
+            temp_tool,
+            hvac_control_assistant,
+        ],
+        callback_handler=None,
+    )
+
+    try:
+        agent_response = agent(case.input)
+    except Exception as e:
+        agent_response = f"Agent execution error: {e}"
+
+    print(f"[User]: {case.input}")
+    print(f"[Agent]: {agent_response}")
+
+    # Inspect final shared state "room_environment" after agent interaction
+    final_state = tool_simulator.get_state("room_environment")
+    print(f"[Room state (after agent invocation)]:")
+    print(f"  Initial state: {final_state.get('initial_state')}")
+    print(f"  Previous calls:")
+    for i, call in enumerate(final_state.get('previous_calls', [])):
+        print(f"    {i}. Tool: {call.get('tool_name')}, Type: {call.get('tool_type')}")
+        print(f"       Response: {str(call.get('response', {}))[:100]}...")
+
+    finished_spans = memory_exporter.get_finished_spans()
+    mapper = StrandsInMemorySessionMapper()
+    session = mapper.map_to_session(finished_spans, session_id=case.session_id)
+
+    return {"output": str(agent_response), "trajectory": session}
+
+# Create test cases
+test_cases = [
+    Case(
+        name="temperature_control", 
+        input="Turn on the heat to 72 degree",
+        metadata={"category": "hvac"},
+    ),
+]
+
+# Create evaluators
+evaluators = [HelpfulnessEvaluator()]
+
+# Create an experiment
+experiment = Experiment[str, str](cases=test_cases, evaluators=evaluators)
+
+# Run evaluations
+reports = experiment.run_evaluations(user_task_function)
+reports[0].run_display()