New source found from dndbeyond.com

ddb_main/node_modules/@mui/material/styles/ThemeProvider.js

@@ -14,9 +14,21 @@ export default function ThemeProvider(_ref) {
     } = _ref,
     props = _objectWithoutPropertiesLoose(_ref, _excluded);
   const scopedTheme = themeInput[THEME_ID];
+  let finalTheme = scopedTheme || themeInput;
+  if (typeof themeInput !== 'function') {
+    if (scopedTheme && !scopedTheme.vars) {
+      finalTheme = _extends({}, scopedTheme, {
+        vars: null
+      });
+    } else if (themeInput && !themeInput.vars) {
+      finalTheme = _extends({}, themeInput, {
+        vars: null
+      });
+    }
+  }
   return /*#__PURE__*/_jsx(SystemThemeProvider, _extends({}, props, {
     themeId: scopedTheme ? THEME_ID : undefined,
-    theme: scopedTheme || themeInput
+    theme: finalTheme
   }));
 }
 process.env.NODE_ENV !== "production" ? ThemeProvider.propTypes = {

ddb_main/node_modules/@mui/material/styles/createTheme.js

@@ -20,7 +20,10 @@ function createTheme(options = {}, ...args) {
       typography: typographyInput = {}
     } = options,
     other = _objectWithoutPropertiesLoose(options, _excluded);
-  if (options.vars) {
+  if (options.vars &&
+  // The error should throw only for the root theme creation because user is not allowed to use a custom node `vars`.
+  // `generateCssVars` is the closest identifier for checking that the `options` is a result of `extendTheme` with CSS variables so that user can create new theme for nested ThemeProvider.
+  options.generateCssVars === undefined) {
     throw new Error(process.env.NODE_ENV !== "production" ? `MUI: \`vars\` is a private field used for CSS variables support.
 Please use another name.` : _formatMuiErrorMessage(18));
   }

ddb_main/node_modules/@mui/material/styles/useThemeProps.js

@@ -1,16 +0,0 @@
-'use client';
-
-import systemUseThemeProps from '@mui/system/useThemeProps';
-import defaultTheme from './defaultTheme';
-import THEME_ID from './identifier';
-export default function useThemeProps({
-  props,
-  name
-}) {
-  return systemUseThemeProps({
-    props,
-    name,
-    defaultTheme,
-    themeId: THEME_ID
-  });
-}