To configure the Chaos Destruction Demo for the 4.26-Chaos Preview, start by downloading the Unreal Engine 4.26-Chaos Preview build. Open the demo project and enable the Chaos Destruction plugins under "Edit" > "Plugins." Restart the editor to apply changes. Navigate to "Project Settings" and enable Chaos Physics in the Physics section. Configure your destruction parameters in the Fracture Editor and use the Chaos Solver actor in the level for simulations. Test and tweak settings for desired destruction effects.