How to reproduce it:
1. Open the attached project '1290390.zip'
2. Load the “SampleScene” from the “Assets” > “Scenes” folder
3. Open Project Settings > Quality. Observe Level's checkboxes. Notice that the 'Medium' level is checked
4. Enter the Play Mode
5. Notice that GameObject's material is visible in the Game view
6. Leave the Play Mode
7. In the Quality settings uncheck 'Medium' level's checkbox
8. Enter the Play Mode
9. Observe the Game View

Expected result: GameObjects’ material doesn’t change after entering Play Mode
Actual result: GameObjects’ material becomes pink after entering Play Mode

Reproducible with: 7.3.1 (2019.4.15f), 8.2.0 (2020.1.14f1), 9.0.0-preview.72 (2020.2.0a19), 10.0.0-preview.26 (2020.2.0b8), 10.1.0 (2020.2.3f1), 10.2.0 (2021.1.0b4), 11.0.0 (2021.2.0a3)
Could not test with: 2018.4.29f1 and lower (Universal RP package is not introduced)

Notes:
- Reproducible when GameObjects’ material is using “Universal Render Pipeline/Lit” and “Universal Render Pipeline/Simple Lit”
- Not reproducible with HDRP project