diff --git a/Tiltfile b/Tiltfile
index 32dcd46078c7..ede9c0b4fa00 100644
--- a/Tiltfile
+++ b/Tiltfile
@@ -322,11 +322,17 @@ def deploy_provider_crds():
     )
 
 def deploy_observability():
-    k8s_yaml(read_file("./.tiltbuild/yaml/observability.tools.yaml"))
+    if "promtail" in settings.get("deploy_observability", []):
+        k8s_yaml(read_file("./.tiltbuild/yaml/promtail.observability.yaml"), allow_duplicates=True)
+        k8s_resource(workload = "promtail", extra_pod_selectors = [{"app": "promtail"}], labels = ["observability"], resource_deps = ["loki"])
 
-    k8s_resource(workload = "promtail", extra_pod_selectors = [{"app": "promtail"}], labels = ["observability"])
-    k8s_resource(workload = "loki", extra_pod_selectors = [{"app": "loki"}], labels = ["observability"])
-    k8s_resource(workload = "grafana", port_forwards = "3000", extra_pod_selectors = [{"app": "grafana"}], labels = ["observability"])
+    if "loki" in settings.get("deploy_observability", []):
+        k8s_yaml(read_file("./.tiltbuild/yaml/loki.observability.yaml"), allow_duplicates=True)
+        k8s_resource(workload = "loki", extra_pod_selectors = [{"app": "loki"}], labels = ["observability"])
+
+    if "grafana" in settings.get("deploy_observability", []):
+        k8s_yaml(read_file("./.tiltbuild/yaml/grafana.observability.yaml"), allow_duplicates=True)
+        k8s_resource(workload = "grafana", port_forwards = "3000", extra_pod_selectors = [{"app": "grafana"}], labels = ["observability"])
 
 def prepare_all():
     allow_k8s_arg = ""
@@ -345,8 +351,8 @@ def prepare_all():
     # Note: we are creating clusterctl CRDs using kustomize (vs using clusterctl) because we want to create
     # a dependency between these resources and provider resources.
     kustomize_build_arg = "--kustomize-builds clusterctl.crd:./cmd/clusterctl/config/crd/ "
-    if settings.get("deploy_observability"):
-        kustomize_build_arg = kustomize_build_arg + "--kustomize-builds observability.tools:./hack/observability/ "
+    for tool in settings.get("deploy_observability", []):
+        kustomize_build_arg = kustomize_build_arg + "--kustomize-builds {tool}.observability:./hack/observability/{tool}/ ".format(tool = tool)
     providers_arg = ""
     for name in get_providers():
         p = providers.get(name)
@@ -382,7 +388,6 @@ prepare_all()
 
 deploy_provider_crds()
 
-if settings.get("deploy_observability"):
-    deploy_observability()
+deploy_observability()
 
 enable_providers()
diff --git a/docs/book/src/developer/tilt.md b/docs/book/src/developer/tilt.md
index 100881d47e77..dc5c17fff8e7 100644
--- a/docs/book/src/developer/tilt.md
+++ b/docs/book/src/developer/tilt.md
@@ -79,8 +79,8 @@ for more details.
 **kustomize_substitutions** (Map{String: String}, default={}): An optional map of substitutions for `${}`-style placeholders in the
 provider's yaml.
 
-**deploy_observability** (Bool, default=false): If set to true, it will instrall grafana, loki and promtail in the dev
-cluster. Grafana UI will be accessible via a link in the tilt console.
+**deploy_observability** ([string], default=[]): If set, it will install  in the dev cluster one of more observability 
+tools between `grafana`, `loki` or `promtail` (Note: the UI for `grafana` will be accessible via a link in the tilt console).
 Important! This feature requires the `helm` command to be available in the user's path.
 
 **debug** (Map{string: Map} default{}): A map of named configurations for the provider. The key is the name of the provider.
diff --git a/hack/observability/grafana/kustomization.yaml b/hack/observability/grafana/kustomization.yaml
new file mode 100644
index 000000000000..efee13fe2223
--- /dev/null
+++ b/hack/observability/grafana/kustomization.yaml
@@ -0,0 +1,9 @@
+resources:
+  - ../namespace.yaml
+
+helmCharts:
+  - name: grafana
+    repo: https://grafana.github.io/helm-charts
+    releaseName: grafana
+    namespace: observability
+    valuesFile: values.yaml
diff --git a/hack/observability/kustomization.yaml b/hack/observability/kustomization.yaml
deleted file mode 100644
index 7d238084ea67..000000000000
--- a/hack/observability/kustomization.yaml
+++ /dev/null
@@ -1,19 +0,0 @@
-resources:
-  - namespace.yaml
-
-helmCharts:
-  - name: promtail
-    repo: https://grafana.github.io/helm-charts
-    releaseName: promtail
-    namespace: observability
-    valuesFile: ./promtail/values.yaml
-  - name: loki
-    repo: https://grafana.github.io/helm-charts
-    releaseName: loki
-    namespace: observability
-    valuesFile: ./loki/values.yaml
-  - name: grafana
-    repo: https://grafana.github.io/helm-charts
-    releaseName: grafana
-    namespace: observability
-    valuesFile: ./grafana/values.yaml
diff --git a/hack/observability/loki/kustomization.yaml b/hack/observability/loki/kustomization.yaml
new file mode 100644
index 000000000000..1462fa75bb7a
--- /dev/null
+++ b/hack/observability/loki/kustomization.yaml
@@ -0,0 +1,9 @@
+resources:
+  - ../namespace.yaml
+
+helmCharts:
+  - name: loki
+    repo: https://grafana.github.io/helm-charts
+    releaseName: loki
+    namespace: observability
+    valuesFile: values.yaml
diff --git a/hack/observability/promtail/kustomization.yaml b/hack/observability/promtail/kustomization.yaml
new file mode 100644
index 000000000000..7233ed2e4d95
--- /dev/null
+++ b/hack/observability/promtail/kustomization.yaml
@@ -0,0 +1,9 @@
+resources:
+  - ../namespace.yaml
+
+helmCharts:
+  - name: promtail
+    repo: https://grafana.github.io/helm-charts
+    releaseName: promtail
+    namespace: observability
+    valuesFile: values.yaml
diff --git a/hack/tools/tilt-prepare/main.go b/hack/tools/tilt-prepare/main.go
index 1dfee9eba407..bcffe45732e7 100644
--- a/hack/tools/tilt-prepare/main.go
+++ b/hack/tools/tilt-prepare/main.go
@@ -355,6 +355,8 @@ func kustomizeTask(path, out string) taskFunction {
 			path,
 			// enable helm to enable helmChartInflationGenerator.
 			"--enable-helm",
+			// to allow picking up resource files from a different folder.
+			"--load-restrictor=LoadRestrictionsNone",
 		)
 
 		var stdout, stderr bytes.Buffer