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Thanks! The sky itself is actually pretty simple — I’m using the standard UE5 Sky Atmosphere setup and the default sky components.  

Most of the stylized look comes from a custom post-process material I made. It handles the main shader/posterization effect.  

I can share a screenshot of the material graph too if you're interested — I don’t mind showing how it works!

It’s a Post Process Material. It takes the final image, breaks the brightness down into about 5–6 fixed levels, and then brings the original colors back in. That makes the lighting and shadows look flatter and more poster-like.  

I can also tweak the number of levels and the strength of the effect with parameters.