diff --git a/.github/workflows/integration-tests.yaml b/.github/workflows/integration-tests.yaml
index ab3c069447ab..36f0a3496eb2 100644
--- a/.github/workflows/integration-tests.yaml
+++ b/.github/workflows/integration-tests.yaml
@@ -141,4 +141,4 @@ jobs:
             --build-arg SQLITE_VERSION=3310100 \
             --build-arg SQLITE_YEAR=2020 \
             -f old-sqlite.Dockerfile . &&
-          docker run prefect-server-new-sqlite sh -c "prefect server database downgrade --yes -r base && prefect server database upgrade --yes"
+          docker run prefect-server-new-sqlite sh -c "prefect server database downgrade --yes -r base && prefect server database upgrade --yes"
\ No newline at end of file
diff --git a/.github/workflows/proxy-test.yaml b/.github/workflows/proxy-test.yaml
new file mode 100644
index 000000000000..cf6d92daf04e
--- /dev/null
+++ b/.github/workflows/proxy-test.yaml
@@ -0,0 +1,74 @@
+# This is a simple test to ensure we can make a websocket connection through a proxy server. It sets up a
+# simple server and a squid proxy server. The proxy server is inaccessible from the host machine, only the proxy
+# so we can confirm the proxy is actually working.
+
+name: Proxy Test
+on:
+  pull_request:
+    paths:
+      - .github/workflows/proxy-test.yaml
+      - scripts/proxy-test/*
+      - "src/prefect/utilities/proxy.py"
+      - requirements.txt
+      - requirements-client.txt
+      - requirements-dev.txt
+  push:
+    branches:
+      - main
+    paths:
+      - .github/workflows/proxy-test.yaml
+      - scripts/proxy-test/*
+      - "src/prefect/utilities/proxy.py"
+      - requirements.txt
+      - requirements-client.txt
+      - requirements-dev.txt
+
+jobs:
+  proxy-test:
+    name: Proxy Test
+    timeout-minutes: 10
+    runs-on: ubuntu-latest
+
+    steps:
+      - uses: actions/checkout@v4
+        with:
+          persist-credentials: false
+          fetch-depth: 0
+
+      - name: Set up Python 3.10
+        uses: actions/setup-python@v5
+        id: setup_python
+        with:
+          python-version: "3.10"
+
+      - name: Create Docker networks
+        run: |
+          docker network create internal_net --internal
+          docker network create external_net
+
+      - name: Start API server container
+        working-directory: scripts/proxy-test
+        run: |
+          docker build -t api-server .
+          docker run -d --network internal_net --name server api-server
+
+      - name: Start Squid Proxy container
+        run: |
+          docker run -d \
+            --network internal_net \
+            --network external_net \
+            -p 3128:3128 \
+            -v $(pwd)/scripts/proxy-test/squid.conf:/etc/squid/squid.conf \
+            --name proxy \
+            ubuntu/squid
+
+      - name: Install Dependencies
+        run: |
+          python -m pip install -U uv
+          uv pip install --upgrade --system .
+
+      - name: Run Proxy Tests
+        env:
+          HTTP_PROXY: http://localhost:3128
+          HTTPS_PROXY: http://localhost:3128
+        run: python scripts/proxy-test/client.py
diff --git a/requirements-client.txt b/requirements-client.txt
index de5e2b5ab1e5..e5424a1c85c1 100644
--- a/requirements-client.txt
+++ b/requirements-client.txt
@@ -26,6 +26,7 @@ pydantic_extra_types >= 2.8.2, < 3.0.0
 pydantic_settings > 2.2.1
 python_dateutil >= 2.8.2, < 3.0.0
 python-slugify >= 5.0, < 9.0
+python-socks[asyncio] >= 2.5.3, < 3.0
 pyyaml >= 5.4.1, < 7.0.0
 rfc3339-validator >= 0.1.4, < 0.2.0
 rich >= 11.0, < 14.0
diff --git a/scripts/proxy-test/Dockerfile b/scripts/proxy-test/Dockerfile
new file mode 100644
index 000000000000..93b6c4db9107
--- /dev/null
+++ b/scripts/proxy-test/Dockerfile
@@ -0,0 +1,11 @@
+FROM python:3.11-slim
+
+WORKDIR /app
+
+COPY requirements.txt .
+RUN pip install uv
+RUN uv pip install --no-cache-dir --system -r requirements.txt
+
+COPY server.py .
+
+CMD ["uvicorn", "server:app", "--host", "0.0.0.0", "--port", "8000"]
diff --git a/scripts/proxy-test/README.md b/scripts/proxy-test/README.md
new file mode 100644
index 000000000000..76a8c8fdc55f
--- /dev/null
+++ b/scripts/proxy-test/README.md
@@ -0,0 +1,9 @@
+This is a simple test to ensure we can make a websocket connection through a proxy server. It sets up a
+simple server and a squid proxy server. The proxy server is inaccessible from the host machine, so we
+can confirm the proxy connection is working.
+
+```
+$ uv pip install -r requirements.txt
+$ docker compose up --build
+$ python client.py
+```
diff --git a/scripts/proxy-test/client.py b/scripts/proxy-test/client.py
new file mode 100644
index 000000000000..1ec748a26131
--- /dev/null
+++ b/scripts/proxy-test/client.py
@@ -0,0 +1,27 @@
+import asyncio
+import os
+
+from prefect.utilities.proxy import websocket_connect
+
+PROXY_URL = "http://localhost:3128"
+WS_SERVER_URL = "ws://server:8000/ws"
+
+
+async def test_websocket_proxy_with_compat():
+    """WebSocket through proxy with proxy compatibility code - should work"""
+    os.environ["HTTP_PROXY"] = "http://localhost:3128"
+
+    async with websocket_connect("ws://server:8000/ws") as websocket:
+        await websocket.send("Hello!")
+        response = await websocket.recv()
+        print("Response: ", response)
+        assert response == "Server received: Hello!"
+
+
+async def main():
+    print("Testing WebSocket through proxy with compatibility code")
+    await test_websocket_proxy_with_compat()
+
+
+if __name__ == "__main__":
+    asyncio.run(main())
diff --git a/scripts/proxy-test/docker-compose.yml b/scripts/proxy-test/docker-compose.yml
new file mode 100644
index 000000000000..ba20d37b9b6f
--- /dev/null
+++ b/scripts/proxy-test/docker-compose.yml
@@ -0,0 +1,20 @@
+services:
+  server:
+    build: .
+    networks:
+      - internal_net
+
+  forward_proxy:
+    image: ubuntu/squid
+    ports:
+      - "3128:3128"
+    volumes:
+      - ./squid.conf:/etc/squid/squid.conf
+    networks:
+      - internal_net
+      - external_net
+
+networks:
+  internal_net:
+    internal: true
+  external_net:
\ No newline at end of file
diff --git a/scripts/proxy-test/requirements.txt b/scripts/proxy-test/requirements.txt
new file mode 100644
index 000000000000..247c9f64fc32
--- /dev/null
+++ b/scripts/proxy-test/requirements.txt
@@ -0,0 +1,6 @@
+fastapi==0.111.1
+uvicorn==0.28.1
+uv==0.5.7
+websockets==13.1
+python-socks==2.5.3
+httpx==0.28.1
\ No newline at end of file
diff --git a/scripts/proxy-test/server.py b/scripts/proxy-test/server.py
new file mode 100644
index 000000000000..4f4498d04a7a
--- /dev/null
+++ b/scripts/proxy-test/server.py
@@ -0,0 +1,10 @@
+from fastapi import FastAPI, WebSocket
+
+app = FastAPI()
+
+
+@app.websocket("/ws")
+async def websocket_endpoint(websocket: WebSocket):
+    await websocket.accept()
+    async for data in websocket.iter_text():
+        await websocket.send_text(f"Server received: {data}")
diff --git a/scripts/proxy-test/squid.conf b/scripts/proxy-test/squid.conf
new file mode 100644
index 000000000000..978f770fd236
--- /dev/null
+++ b/scripts/proxy-test/squid.conf
@@ -0,0 +1,5 @@
+http_port 3128
+acl CONNECT method CONNECT
+acl SSL_ports port 443 8000
+http_access allow CONNECT SSL_ports
+http_access allow all
\ No newline at end of file
diff --git a/src/prefect/events/clients.py b/src/prefect/events/clients.py
index bd09eb3ab20c..3e09f033d1e2 100644
--- a/src/prefect/events/clients.py
+++ b/src/prefect/events/clients.py
@@ -21,7 +21,7 @@
 from prometheus_client import Counter
 from typing_extensions import Self
 from websockets import Subprotocol
-from websockets.client import WebSocketClientProtocol, connect
+from websockets.client import WebSocketClientProtocol
 from websockets.exceptions import (
     ConnectionClosed,
     ConnectionClosedError,
@@ -37,6 +37,7 @@
     PREFECT_DEBUG_MODE,
     PREFECT_SERVER_ALLOW_EPHEMERAL_MODE,
 )
+from prefect.utilities.proxy import websocket_connect
 
 if TYPE_CHECKING:
     from prefect.events.filters import EventFilter
@@ -265,7 +266,7 @@ def __init__(
             )
 
         self._events_socket_url = events_in_socket_from_api_url(api_url)
-        self._connect = connect(self._events_socket_url)
+        self._connect = websocket_connect(self._events_socket_url)
         self._websocket = None
         self._reconnection_attempts = reconnection_attempts
         self._unconfirmed_events = []
@@ -435,7 +436,7 @@ def __init__(
             reconnection_attempts=reconnection_attempts,
             checkpoint_every=checkpoint_every,
         )
-        self._connect = connect(
+        self._connect = websocket_connect(
             self._events_socket_url,
             extra_headers={"Authorization": f"bearer {api_key}"},
         )
@@ -494,7 +495,7 @@ def __init__(
 
         logger.debug("Connecting to %s", socket_url)
 
-        self._connect = connect(
+        self._connect = websocket_connect(
             socket_url,
             subprotocols=[Subprotocol("prefect")],
         )
diff --git a/src/prefect/utilities/proxy.py b/src/prefect/utilities/proxy.py
new file mode 100644
index 000000000000..e70accbb7afb
--- /dev/null
+++ b/src/prefect/utilities/proxy.py
@@ -0,0 +1,58 @@
+import os
+from typing import (
+    Any,
+    Generator,
+)
+from urllib.parse import urlparse
+
+from python_socks.async_.asyncio import Proxy
+from typing_extensions import Self
+from websockets.client import WebSocketClientProtocol
+from websockets.legacy.client import Connect
+
+
+class WebsocketProxyConnect(Connect):
+    def __init__(self: Self, uri: str, **kwargs: Any):
+        # super() is intentionally deferred to the __proxy_connect__ method
+        # to allow for the proxy to be established before the connection is made
+
+        self.uri = uri
+        self.__kwargs = kwargs
+
+        u = urlparse(uri)
+        host = u.hostname
+
+        if u.scheme == "ws":
+            port = u.port or 80
+            proxy_url = os.environ.get("HTTP_PROXY")
+        elif u.scheme == "wss":
+            port = u.port or 443
+            proxy_url = os.environ.get("HTTPS_PROXY")
+            kwargs["server_hostname"] = host
+        else:
+            raise ValueError(
+                "Unsupported scheme %s. Expected 'ws' or 'wss'. " % u.scheme
+            )
+
+        self.__proxy = Proxy.from_url(proxy_url) if proxy_url else None
+        self.__host = host
+        self.__port = port
+
+    async def __proxy_connect__(self: Self) -> WebSocketClientProtocol:
+        if self.__proxy:
+            sock = await self.__proxy.connect(
+                dest_host=self.__host,
+                dest_port=self.__port,
+            )
+            self.__kwargs["sock"] = sock
+
+        super().__init__(self.uri, **self.__kwargs)
+        proto = await self.__await_impl__()
+        return proto
+
+    def __await__(self: Self) -> Generator[Any, None, WebSocketClientProtocol]:
+        return self.__proxy_connect__().__await__()
+
+
+def websocket_connect(uri: str, **kwargs: Any) -> WebsocketProxyConnect:
+    return WebsocketProxyConnect(uri, **kwargs)
diff --git a/tests/events/client/test_events_client.py b/tests/events/client/test_events_client.py
index 9acf2ef82b2b..5b6970ae7e3b 100644
--- a/tests/events/client/test_events_client.py
+++ b/tests/events/client/test_events_client.py
@@ -359,7 +359,7 @@ async def __aexit__(self, exc_type, exc_val, exc_tb):
     def mock_connect(*args, **kwargs):
         return MockConnect()
 
-    monkeypatch.setattr("prefect.events.clients.connect", mock_connect)
+    monkeypatch.setattr("prefect.events.clients.websocket_connect", mock_connect)
 
     with caplog.at_level(logging.WARNING):
         with pytest.raises(Exception, match="Connection failed"):
diff --git a/tests/utilities/test_proxy.py b/tests/utilities/test_proxy.py
new file mode 100644
index 000000000000..4ddecd8fa6c7
--- /dev/null
+++ b/tests/utilities/test_proxy.py
@@ -0,0 +1,42 @@
+from unittest.mock import Mock
+
+from prefect.utilities.proxy import WebsocketProxyConnect
+
+
+def test_init_ws_without_proxy():
+    client = WebsocketProxyConnect("ws://example.com")
+    assert client.uri == "ws://example.com"
+    assert client._WebsocketProxyConnect__host == "example.com"
+    assert client._WebsocketProxyConnect__port == 80
+    assert client._WebsocketProxyConnect__proxy is None
+
+
+def test_init_wss_without_proxy():
+    client = WebsocketProxyConnect("wss://example.com")
+    assert client.uri == "wss://example.com"
+    assert client._WebsocketProxyConnect__host == "example.com"
+    assert client._WebsocketProxyConnect__port == 443
+    assert "server_hostname" in client._WebsocketProxyConnect__kwargs
+    assert client._WebsocketProxyConnect__proxy is None
+
+
+def test_init_ws_with_proxy(monkeypatch):
+    monkeypatch.setenv("HTTP_PROXY", "http://proxy:3128")
+    mock_proxy = Mock()
+    monkeypatch.setattr("prefect.utilities.proxy.Proxy", mock_proxy)
+
+    client = WebsocketProxyConnect("ws://example.com")
+
+    mock_proxy.from_url.assert_called_once_with("http://proxy:3128")
+    assert client._WebsocketProxyConnect__proxy is not None
+
+
+def test_init_wss_with_proxy(monkeypatch):
+    monkeypatch.setenv("HTTPS_PROXY", "https://proxy:3128")
+    mock_proxy = Mock()
+    monkeypatch.setattr("prefect.utilities.proxy.Proxy", mock_proxy)
+
+    client = WebsocketProxyConnect("wss://example.com")
+
+    mock_proxy.from_url.assert_called_once_with("https://proxy:3128")
+    assert client._WebsocketProxyConnect__proxy is not None