Settings fragment does not have background

Question

I am trying to create a Settings screen for my app. The fragment opens, but I don't know how to set it to have the Material3 theme.

As you can see, it has no background, and the dialog has the old Material style.

settings.xml

<?xml version="1.0" encoding="utf-8"?>
<PreferenceScreen xmlns:android="http://schemas.android.com/apk/res/android">

    <PreferenceCategory android:title="@string/settings_theme">

        <ListPreference
            android:defaultValue="1"
            android:entries="@array/settings_theme_options"
            android:entryValues="@array/settings_theme_options"
            android:icon="@drawable/round_brightness_4_24"
            android:key="settings_theme"
            android:title="@string/settings_theme_title" />
    </PreferenceCategory>
</PreferenceScreen>

SettingsFragment.java

public class SettingsFragment extends PreferenceFragmentCompat {

    @Override
    public void onCreatePreferences(Bundle savedInstanceState, String rootKey) {
        setPreferencesFromResource(R.xml.settings, rootKey);
    }
}

Listener from MainActivity.java

    @Override
    public boolean onMenuItemSelected(@NonNull MenuItem menuItem) {
        if (menuItem.getItemId() == R.id.nav_settings) {
            FragmentManager fragmentManager = getSupportFragmentManager();
            FragmentTransaction transaction = fragmentManager.beginTransaction();
            transaction.replace(android.R.id.content, new SettingsFragment()).addToBackStack(null).commit();
        }
        return false;
    }

What am I doing wrong?