diff --git a/.changeset/neat-beans-wave.md b/.changeset/neat-beans-wave.md
new file mode 100644
index 0000000..a34c058
--- /dev/null
+++ b/.changeset/neat-beans-wave.md
@@ -0,0 +1,24 @@
+---
+"@statelyai/inspect": minor
+---
+
+Added new options `sanitizeContext` and `sanitizeEvent` to the inspector configuration. These options allow users to sanitize sensitive data from the context and events before they are sent to the inspector, and also to remove non-serializable data. 
+
+Example usage:
+
+```typescript
+const inspector = createInspector({
+  sanitizeContext: (context) => {
+    // Remove sensitive data from context
+    const { password, ...safeContext } = context;
+    return safeContext;
+  },
+  sanitizeEvent: (event) => {
+    // Remove sensitive data from event
+    if (event.type === 'SUBMIT_FORM') {
+      const { creditCardNumber, ...safeEvent } = event;
+      return safeEvent;
+    }
+    return event;
+  }
+});
diff --git a/src/createInspector.test.ts b/src/createInspector.test.ts
index a266d3f..0ab3e51 100644
--- a/src/createInspector.test.ts
+++ b/src/createInspector.test.ts
@@ -260,6 +260,69 @@ test('options.serialize', async () => {
   });
 });
 
+test('Sanitization options', async () => {
+  const events: StatelyInspectionEvent[] = [];
+  const testAdapter: Adapter = {
+    send: (event) => {
+      events.push(event);
+    },
+    start: () => {},
+    stop: () => {},
+  };
+  const inspector = createInspector(testAdapter, {
+    sanitizeContext: (ctx) => ({
+      ...ctx,
+      user: 'anonymous',
+    }),
+    sanitizeEvent: (ev) => {
+      if ('user' in ev) {
+        return { ...ev, user: 'anonymous' };
+      } else {
+        return ev;
+      }
+    },
+  });
+
+  inspector.actor('test', { context: { user: 'David' } });
+
+  expect((events[0] as StatelyActorEvent).snapshot.context).toEqual({
+    user: 'anonymous',
+  });
+
+  inspector.snapshot('test', { context: { user: 'David' } });
+
+  expect((events[1] as StatelyActorEvent).snapshot.context).toEqual({
+    user: 'anonymous',
+  });
+
+  inspector.event('test', { type: 'updateUser', user: 'David' });
+
+  expect((events[2] as StatelyEventEvent).event).toEqual({
+    type: 'updateUser',
+    user: 'anonymous',
+  });
+
+  inspector.inspect.next?.({
+    type: '@xstate.event',
+    actorRef: {} as any,
+    event: {
+      type: 'setUser',
+      user: 'Another',
+    },
+    rootId: '',
+    sourceRef: undefined,
+  });
+
+  await new Promise<void>((res) => {
+    setTimeout(res, 10);
+  });
+
+  expect((events[3] as StatelyEventEvent).event).toEqual({
+    type: 'setUser',
+    user: 'anonymous',
+  });
+});
+
 test('it safely stringifies objects with circular dependencies', () => {
   const events: StatelyInspectionEvent[] = [];
   const testAdapter: Adapter = {
diff --git a/src/createInspector.ts b/src/createInspector.ts
index 0b7ab16..0f39184 100644
--- a/src/createInspector.ts
+++ b/src/createInspector.ts
@@ -7,7 +7,13 @@ import {
 } from './types';
 import { toEventObject } from './utils';
 import { Inspector } from './types';
-import { AnyActorRef, InspectionEvent, Snapshot } from 'xstate';
+import {
+  AnyActorRef,
+  AnyEventObject,
+  InspectionEvent,
+  MachineContext,
+  Snapshot,
+} from 'xstate';
 import pkg from '../package.json';
 import { idleCallback } from './idleCallback';
 import safeStringify from 'safe-stable-stringify';
@@ -40,7 +46,23 @@ export interface InspectorOptions {
    * @default true
    */
   autoStart?: boolean;
+  /**
+   * The maximum number of deferred events to hold in memory until the inspector is active.
+   * If the number of deferred events exceeds this number, the oldest events will be dropped.
+   *
+   * @default 200
+   */
   maxDeferredEvents?: number;
+
+  /**
+   * Sanitizes events sent to actors. Only the sanitized event will be sent to the inspector.
+   */
+  sanitizeEvent?: (event: AnyEventObject) => AnyEventObject;
+
+  /**
+   * Sanitizes actor snapshot context. Only the sanitized context will be sent to the inspector.
+   */
+  sanitizeContext?: (context: MachineContext) => MachineContext;
 }
 
 export const defaultInspectorOptions: Required<InspectorOptions> = {
@@ -48,21 +70,50 @@ export const defaultInspectorOptions: Required<InspectorOptions> = {
   serialize: (event) => event,
   autoStart: true,
   maxDeferredEvents: 200,
+  sanitizeEvent: (event) => event,
+  sanitizeContext: (context) => context,
 };
 
 export function createInspector<TAdapter extends Adapter>(
   adapter: TAdapter,
   options?: InspectorOptions
 ): Inspector<TAdapter> {
-  function sendAdapter(event: StatelyInspectionEvent): void {
-    if (options?.filter && !options.filter(event)) {
+  function sendAdapter(inspectionEvent: StatelyInspectionEvent): void {
+    if (options?.filter && !options.filter(inspectionEvent)) {
       // Event filtered out
       return;
     }
-    const serializedEvent = options?.serialize?.(event) ?? event;
-    // idleCallback(() => {
+
+    const sanitizedEvent: typeof inspectionEvent =
+      options?.sanitizeContext || options?.sanitizeEvent
+        ? inspectionEvent
+        : {
+            ...inspectionEvent,
+          };
+    if (
+      options?.sanitizeContext &&
+      (sanitizedEvent.type === '@xstate.actor' ||
+        sanitizedEvent.type === '@xstate.snapshot')
+    ) {
+      sanitizedEvent.snapshot = {
+        ...sanitizedEvent.snapshot,
+        // @ts-ignore
+        context: options.sanitizeContext(
+          // @ts-ignore
+          sanitizedEvent.snapshot.context
+        ),
+      };
+    }
+    if (
+      options?.sanitizeEvent &&
+      (sanitizedEvent.type === '@xstate.event' ||
+        sanitizedEvent.type === '@xstate.snapshot')
+    ) {
+      sanitizedEvent.event = options.sanitizeEvent(sanitizedEvent.event);
+    }
+    const serializedEvent =
+      options?.serialize?.(sanitizedEvent) ?? sanitizedEvent;
     adapter.send(serializedEvent);
-    // })
   }
   const inspector: Inspector<TAdapter> = {
     adapter,