diff --git a/docs/source/usage_guides/training_zoo.mdx b/docs/source/usage_guides/training_zoo.mdx
index b3fff25e3..cc388acac 100644
--- a/docs/source/usage_guides/training_zoo.mdx
+++ b/docs/source/usage_guides/training_zoo.mdx
@@ -27,6 +27,7 @@ These examples showcase the base features of Accelerate and are a great starting
 
 These examples showcase specific features that the Accelerate framework offers
 
+- [Automatic memory-aware gradient accumulation](https://github.com/huggingface/accelerate/blob/main/examples/by_feature/automatic_gradient_accumulation.py)
 - [Checkpointing states](https://github.com/huggingface/accelerate/blob/main/examples/by_feature/checkpointing.py)
 - [Cross validation](https://github.com/huggingface/accelerate/blob/main/examples/by_feature/cross_validation.py)
 - [DeepSpeed](https://github.com/huggingface/accelerate/blob/main/examples/by_feature/deepspeed_with_config_support.py)
diff --git a/examples/by_feature/automatic_gradient_accumulation.py b/examples/by_feature/automatic_gradient_accumulation.py
new file mode 100644
index 000000000..d6e0cf028
--- /dev/null
+++ b/examples/by_feature/automatic_gradient_accumulation.py
@@ -0,0 +1,232 @@
+# Copyright 2022 The HuggingFace Team. All rights reserved.
+#
+# Licensed under the Apache License, Version 2.0 (the "License");
+# you may not use this file except in compliance with the License.
+# You may obtain a copy of the License at
+#
+#     http://www.apache.org/licenses/LICENSE-2.0
+#
+# Unless required by applicable law or agreed to in writing, software
+# distributed under the License is distributed on an "AS IS" BASIS,
+# WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+# See the License for the specific language governing permissions and
+# limitations under the License.
+import argparse
+import os
+
+import torch
+from torch.optim import AdamW
+from torch.utils.data import DataLoader
+
+# New Code #
+import evaluate
+from accelerate import Accelerator, DistributedType
+from accelerate.utils import find_executable_batch_size
+from datasets import load_dataset
+from transformers import AutoModelForSequenceClassification, AutoTokenizer, get_linear_schedule_with_warmup, set_seed
+
+
+########################################################################
+# This is a fully working simple example to use Accelerate,
+# specifically showcasing how to combine both the gradient accumulation
+# and automatic batch size finder utilities of Accelerate to perfrom
+# automatic gradient accumulation
+#
+# This example trains a Bert base model on GLUE MRPC
+# in any of the following settings (with the same script):
+#   - single CPU or single GPU
+#   - multi GPUS (using PyTorch distributed mode)
+#   - (multi) TPUs
+#   - fp16 (mixed-precision) or fp32 (normal precision)
+#
+# New additions from the base script can be found quickly by
+# looking for the # New Code # tags
+#
+# To run it in each of these various modes, follow the instructions
+# in the readme for examples:
+# https://github.com/huggingface/accelerate/tree/main/examples
+#
+########################################################################
+
+EVAL_BATCH_SIZE = 32
+
+
+def get_dataloaders(accelerator: Accelerator, batch_size: int = 16):
+    """
+    Creates a set of `DataLoader`s for the `glue` dataset,
+    using "bert-base-cased" as the tokenizer.
+
+    Args:
+        accelerator (`Accelerator`):
+            An `Accelerator` object
+        batch_size (`int`, *optional*):
+            The batch size for the train and validation DataLoaders.
+    """
+    tokenizer = AutoTokenizer.from_pretrained("bert-base-cased")
+    datasets = load_dataset("glue", "mrpc")
+
+    def tokenize_function(examples):
+        # max_length=None => use the model max length (it's actually the default)
+        outputs = tokenizer(examples["sentence1"], examples["sentence2"], truncation=True, max_length=None)
+        return outputs
+
+    # Apply the method we just defined to all the examples in all the splits of the dataset
+    # starting with the main process first:
+    with accelerator.main_process_first():
+        tokenized_datasets = datasets.map(
+            tokenize_function,
+            batched=True,
+            remove_columns=["idx", "sentence1", "sentence2"],
+        )
+
+    # We also rename the 'label' column to 'labels' which is the expected name for labels by the models of the
+    # transformers library
+    tokenized_datasets = tokenized_datasets.rename_column("label", "labels")
+
+    def collate_fn(examples):
+        # On TPU it's best to pad everything to the same length or training will be very slow.
+        if accelerator.distributed_type == DistributedType.TPU:
+            return tokenizer.pad(examples, padding="max_length", max_length=128, return_tensors="pt")
+        return tokenizer.pad(examples, padding="longest", return_tensors="pt")
+
+    # Instantiate dataloaders.
+    train_dataloader = DataLoader(
+        tokenized_datasets["train"], shuffle=True, collate_fn=collate_fn, batch_size=batch_size
+    )
+    eval_dataloader = DataLoader(
+        tokenized_datasets["validation"], shuffle=False, collate_fn=collate_fn, batch_size=EVAL_BATCH_SIZE
+    )
+
+    return train_dataloader, eval_dataloader
+
+
+# For testing only
+if os.environ.get("TESTING_MOCKED_DATALOADERS", None) == "1":
+    from accelerate.test_utils.training import mocked_dataloaders
+
+    get_dataloaders = mocked_dataloaders  # noqa: F811
+
+
+def training_function(config, args):
+    # For testing only
+    if os.environ.get("TESTING_MOCKED_DATALOADERS", None) == "1":
+        config["num_epochs"] = 2
+    # Initialize accelerator
+    accelerator = Accelerator(cpu=args.cpu, mixed_precision=args.mixed_precision)
+    # Sample hyper-parameters for learning rate, batch size, seed and a few other HPs
+    lr = config["lr"]
+    num_epochs = int(config["num_epochs"])
+    seed = int(config["seed"])
+    observed_batch_size = int(config["batch_size"])
+
+    metric = evaluate.load("glue", "mrpc")
+
+    # New Code #
+    # We use the `find_executable_batch_size` decorator, passing in the desired observed batch size
+    # to train on. If a CUDA OOM error occurs, it will retry this loop cutting the batch size in
+    # half each time. From this, we can calculate the number of gradient accumulation steps needed
+    # and modify the Accelerator object as a result
+    @find_executable_batch_size(starting_batch_size=int(observed_batch_size))
+    def inner_training_loop(batch_size):
+        # Since we need to modify the outside accelerator object, we need to bring it
+        # to the local scope
+        nonlocal accelerator
+
+        # We can calculate the number of gradient accumulation steps based on the current
+        # batch size vs the starting batch size
+        num_gradient_accumulation_steps = observed_batch_size // batch_size
+
+        # And then set it in the Accelerator directly:
+        accelerator.gradient_accumulation_steps = num_gradient_accumulation_steps
+
+        # Next we need to free all of the stored model references in the Accelerator each time
+        accelerator.free_memory()
+
+        # And set the seed so our results are reproducable each reset
+        set_seed(seed)
+
+        # Instantiate the model (we build the model here so that the seed also control new weights initialization)
+        model = AutoModelForSequenceClassification.from_pretrained("bert-base-cased", return_dict=True)
+
+        # We could avoid this line since the accelerator is set with `device_placement=True` (default value).
+        # Note that if you are placing tensors on devices manually, this line absolutely needs to be before the optimizer
+        # creation otherwise training will not work on TPU (`accelerate` will kindly throw an error to make us aware of that).
+        model = model.to(accelerator.device)
+
+        # Instantiate optimizer
+        optimizer = AdamW(params=model.parameters(), lr=lr)
+        train_dataloader, eval_dataloader = get_dataloaders(accelerator, batch_size)
+
+        # Instantiate scheduler
+        lr_scheduler = get_linear_schedule_with_warmup(
+            optimizer=optimizer,
+            num_warmup_steps=100,
+            num_training_steps=(len(train_dataloader) * num_epochs),
+        )
+
+        # Prepare everything
+        # There is no specific order to remember, we just need to unpack the objects in the same order we gave them to the
+        # prepare method.
+        model, optimizer, train_dataloader, eval_dataloader, lr_scheduler = accelerator.prepare(
+            model, optimizer, train_dataloader, eval_dataloader, lr_scheduler
+        )
+
+        # Now we train the model
+        for epoch in range(num_epochs):
+            model.train()
+            for step, batch in enumerate(train_dataloader):
+                # And perform gradient accumulation
+                with accelerator.accumulate(model):
+                    # We could avoid this line since we set the accelerator with `device_placement=True`.
+                    batch.to(accelerator.device)
+                    outputs = model(**batch)
+                    loss = outputs.loss
+                    accelerator.backward(loss)
+                    optimizer.step()
+                    lr_scheduler.step()
+                    optimizer.zero_grad()
+
+            model.eval()
+            for step, batch in enumerate(eval_dataloader):
+                # We could avoid this line since we set the accelerator with `device_placement=True`.
+                batch.to(accelerator.device)
+                with torch.no_grad():
+                    outputs = model(**batch)
+                predictions = outputs.logits.argmax(dim=-1)
+                predictions, references = accelerator.gather_for_metrics((predictions, batch["labels"]))
+                metric.add_batch(
+                    predictions=predictions,
+                    references=references,
+                )
+
+            eval_metric = metric.compute()
+            # Use accelerator.print to print only on the main process.
+            accelerator.print(f"epoch {epoch}:", eval_metric)
+
+    # New Code #
+    # And call it at the end with no arguments
+    # Note: You could also refactor this outside of your training loop function
+    inner_training_loop()
+
+
+def main():
+    parser = argparse.ArgumentParser(description="Simple example of training script.")
+    parser.add_argument(
+        "--mixed_precision",
+        type=str,
+        default="no",
+        choices=["no", "fp16", "bf16"],
+        help="Whether to use mixed precision. Choose"
+        "between fp16 and bf16 (bfloat16). Bf16 requires PyTorch >= 1.10."
+        "and an Nvidia Ampere GPU.",
+    )
+    parser.add_argument("--cpu", action="store_true", help="If passed, will train on the CPU.")
+    args = parser.parse_args()
+    # New Code #
+    # We modify the starting batch size to be an observed batch size of 256, to guarentee an initial CUDA OOM
+    config = {"lr": 2e-5, "num_epochs": 3, "seed": 42, "batch_size": 256}
+    training_function(config, args)
+
+
+if __name__ == "__main__":
+    main()
diff --git a/tests/test_examples.py b/tests/test_examples.py
index ac8c4de52..9197070c8 100644
--- a/tests/test_examples.py
+++ b/tests/test_examples.py
@@ -36,6 +36,7 @@
     "gradient_accumulation.py",
     "multi_process_metrics.py",
     "memory.py",
+    "automatic_gradient_accumulation.py",
     "fsdp_with_peak_mem_tracking.py",
     "deepspeed_with_config_support.py",
 ]


Review comments: body: ```suggestion
    # half each time. From this, we can calculate the number of gradient accumulation steps needed
```
diff_hunk: @@ -0,0 +1,232 @@
+# Copyright 2022 The HuggingFace Team. All rights reserved.
+#
+# Licensed under the Apache License, Version 2.0 (the "License");
+# you may not use this file except in compliance with the License.
+# You may obtain a copy of the License at
+#
+#     http://www.apache.org/licenses/LICENSE-2.0
+#
+# Unless required by applicable law or agreed to in writing, software
+# distributed under the License is distributed on an "AS IS" BASIS,
+# WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+# See the License for the specific language governing permissions and
+# limitations under the License.
+import argparse
+import os
+
+import torch
+from torch.optim import AdamW
+from torch.utils.data import DataLoader
+
+# New Code #
+import evaluate
+from accelerate import Accelerator, DistributedType
+from accelerate.utils import find_executable_batch_size
+from datasets import load_dataset
+from transformers import AutoModelForSequenceClassification, AutoTokenizer, get_linear_schedule_with_warmup, set_seed
+
+
+########################################################################
+# This is a fully working simple example to use Accelerate,
+# specifically showcasing how to combine both the gradient accumulation
+# and automatic batch size finder utilities of Accelerate to perfrom
+# automatic gradient accumulation
+#
+# This example trains a Bert base model on GLUE MRPC
+# in any of the following settings (with the same script):
+#   - single CPU or single GPU
+#   - multi GPUS (using PyTorch distributed mode)
+#   - (multi) TPUs
+#   - fp16 (mixed-precision) or fp32 (normal precision)
+#
+# New additions from the base script can be found quickly by
+# looking for the # New Code # tags
+#
+# To run it in each of these various modes, follow the instructions
+# in the readme for examples:
+# https://github.com/huggingface/accelerate/tree/main/examples
+#
+########################################################################
+
+EVAL_BATCH_SIZE = 32
+
+
+def get_dataloaders(accelerator: Accelerator, batch_size: int = 16):
+    """
+    Creates a set of `DataLoader`s for the `glue` dataset,
+    using "bert-base-cased" as the tokenizer.
+
+    Args:
+        accelerator (`Accelerator`):
+            An `Accelerator` object
+        batch_size (`int`, *optional*):
+            The batch size for the train and validation DataLoaders.
+    """
+    tokenizer = AutoTokenizer.from_pretrained("bert-base-cased")
+    datasets = load_dataset("glue", "mrpc")
+
+    def tokenize_function(examples):
+        # max_length=None => use the model max length (it's actually the default)
+        outputs = tokenizer(examples["sentence1"], examples["sentence2"], truncation=True, max_length=None)
+        return outputs
+
+    # Apply the method we just defined to all the examples in all the splits of the dataset
+    # starting with the main process first:
+    with accelerator.main_process_first():
+        tokenized_datasets = datasets.map(
+            tokenize_function,
+            batched=True,
+            remove_columns=["idx", "sentence1", "sentence2"],
+        )
+
+    # We also rename the 'label' column to 'labels' which is the expected name for labels by the models of the
+    # transformers library
+    tokenized_datasets = tokenized_datasets.rename_column("label", "labels")
+
+    def collate_fn(examples):
+        # On TPU it's best to pad everything to the same length or training will be very slow.
+        if accelerator.distributed_type == DistributedType.TPU:
+            return tokenizer.pad(examples, padding="max_length", max_length=128, return_tensors="pt")
+        return tokenizer.pad(examples, padding="longest", return_tensors="pt")
+
+    # Instantiate dataloaders.
+    train_dataloader = DataLoader(
+        tokenized_datasets["train"], shuffle=True, collate_fn=collate_fn, batch_size=batch_size
+    )
+    eval_dataloader = DataLoader(
+        tokenized_datasets["validation"], shuffle=False, collate_fn=collate_fn, batch_size=EVAL_BATCH_SIZE
+    )
+
+    return train_dataloader, eval_dataloader
+
+
+# For testing only
+if os.environ.get("TESTING_MOCKED_DATALOADERS", None) == "1":
+    from accelerate.test_utils.training import mocked_dataloaders
+
+    get_dataloaders = mocked_dataloaders  # noqa: F811
+
+
+def training_function(config, args):
+    # For testing only
+    if os.environ.get("TESTING_MOCKED_DATALOADERS", None) == "1":
+        config["num_epochs"] = 2
+    # Initialize accelerator
+    accelerator = Accelerator(cpu=args.cpu, mixed_precision=args.mixed_precision)
+    # Sample hyper-parameters for learning rate, batch size, seed and a few other HPs
+    lr = config["lr"]
+    num_epochs = int(config["num_epochs"])
+    seed = int(config["seed"])
+    observed_batch_size = int(config["batch_size"])
+
+    metric = evaluate.load("glue", "mrpc")
+
+    # New Code #
+    # We use the `find_executable_batch_size` decorator, passing in the desired observed batch size
+    # to train on. If a CUDA OOM error occurs, it will retry this loop cutting the batch size in
+    # half each time. From this, we can calcualte the number of gradient accumulation steps needed

Discussion: body: The docs for this PR live [here](https://moon-ci-docs.huggingface.co/docs/accelerate/pr_742). All of your documentation changes will be reflected on that endpoint.