diff --git a/.changelog/20012.txt b/.changelog/20012.txt
new file mode 100644
index 000000000000..6f9cc4555651
--- /dev/null
+++ b/.changelog/20012.txt
@@ -0,0 +1,3 @@
+```release-note:improvement
+xds: replace usage of deprecated Envoy field `envoy.extensions.filters.http.lua.v3.Lua.inline_code`
+```
diff --git a/agent/envoyextensions/builtin/lua/lua.go b/agent/envoyextensions/builtin/lua/lua.go
index aefea37e6c49..8573252af67e 100644
--- a/agent/envoyextensions/builtin/lua/lua.go
+++ b/agent/envoyextensions/builtin/lua/lua.go
@@ -6,6 +6,7 @@ package lua
 import (
 	"errors"
 	"fmt"
+	envoy_core_v3 "github.com/envoyproxy/go-control-plane/envoy/config/core/v3"
 
 	envoy_listener_v3 "github.com/envoyproxy/go-control-plane/envoy/config/listener/v3"
 	envoy_lua_v3 "github.com/envoyproxy/go-control-plane/envoy/extensions/filters/http/lua/v3"
@@ -97,7 +98,11 @@ func (l *lua) PatchFilter(p extensioncommon.FilterPayload) (*envoy_listener_v3.F
 	luaHttpFilter, err := extensioncommon.MakeEnvoyHTTPFilter(
 		"envoy.filters.http.lua",
 		&envoy_lua_v3.Lua{
-			InlineCode: l.Script,
+			DefaultSourceCode: &envoy_core_v3.DataSource{
+				Specifier: &envoy_core_v3.DataSource_InlineString{
+					InlineString: l.Script,
+				},
+			},
 		},
 	)
 	if err != nil {
diff --git a/agent/xds/testdata/builtin_extension/listeners/lambda-and-lua-connect-proxy.latest.golden b/agent/xds/testdata/builtin_extension/listeners/lambda-and-lua-connect-proxy.latest.golden
index 945be5c4032f..45875e5059a0 100644
--- a/agent/xds/testdata/builtin_extension/listeners/lambda-and-lua-connect-proxy.latest.golden
+++ b/agent/xds/testdata/builtin_extension/listeners/lambda-and-lua-connect-proxy.latest.golden
@@ -224,7 +224,9 @@
                     "name": "envoy.filters.http.lua",
                     "typedConfig": {
                       "@type": "type.googleapis.com/envoy.extensions.filters.http.lua.v3.Lua",
-                      "inlineCode": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      "defaultSourceCode": {
+                        "inlineString": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      }
                     }
                   },
                   {
diff --git a/agent/xds/testdata/builtin_extension/listeners/lua-inbound-applies-to-inbound.latest.golden b/agent/xds/testdata/builtin_extension/listeners/lua-inbound-applies-to-inbound.latest.golden
index be339e7a190e..a5f1f4a50028 100644
--- a/agent/xds/testdata/builtin_extension/listeners/lua-inbound-applies-to-inbound.latest.golden
+++ b/agent/xds/testdata/builtin_extension/listeners/lua-inbound-applies-to-inbound.latest.golden
@@ -179,7 +179,9 @@
                     "name": "envoy.filters.http.lua",
                     "typedConfig": {
                       "@type": "type.googleapis.com/envoy.extensions.filters.http.lua.v3.Lua",
-                      "inlineCode": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      "defaultSourceCode": {
+                        "inlineString": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      }
                     }
                   },
                   {
diff --git a/agent/xds/testdata/builtin_extension/listeners/lua-inbound-doesnt-apply-to-local-upstreams.latest.golden b/agent/xds/testdata/builtin_extension/listeners/lua-inbound-doesnt-apply-to-local-upstreams.latest.golden
index 7f91026f6cf9..6eab0ac40537 100644
--- a/agent/xds/testdata/builtin_extension/listeners/lua-inbound-doesnt-apply-to-local-upstreams.latest.golden
+++ b/agent/xds/testdata/builtin_extension/listeners/lua-inbound-doesnt-apply-to-local-upstreams.latest.golden
@@ -215,7 +215,9 @@
                     "name": "envoy.filters.http.lua",
                     "typedConfig": {
                       "@type": "type.googleapis.com/envoy.extensions.filters.http.lua.v3.Lua",
-                      "inlineCode": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      "defaultSourceCode": {
+                        "inlineString": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      }
                     }
                   },
                   {
diff --git a/agent/xds/testdata/builtin_extension/listeners/lua-outbound-applies-to-local-upstreams-tproxy.latest.golden b/agent/xds/testdata/builtin_extension/listeners/lua-outbound-applies-to-local-upstreams-tproxy.latest.golden
index 20bb59055ada..c7476ece4f4e 100644
--- a/agent/xds/testdata/builtin_extension/listeners/lua-outbound-applies-to-local-upstreams-tproxy.latest.golden
+++ b/agent/xds/testdata/builtin_extension/listeners/lua-outbound-applies-to-local-upstreams-tproxy.latest.golden
@@ -58,7 +58,9 @@
                     "name": "envoy.filters.http.lua",
                     "typedConfig": {
                       "@type": "type.googleapis.com/envoy.extensions.filters.http.lua.v3.Lua",
-                      "inlineCode": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      "defaultSourceCode": {
+                        "inlineString": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      }
                     }
                   },
                   {
@@ -102,7 +104,9 @@
                     "name": "envoy.filters.http.lua",
                     "typedConfig": {
                       "@type": "type.googleapis.com/envoy.extensions.filters.http.lua.v3.Lua",
-                      "inlineCode": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      "defaultSourceCode": {
+                        "inlineString": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      }
                     }
                   },
                   {
diff --git a/agent/xds/testdata/builtin_extension/listeners/lua-outbound-applies-to-local-upstreams.latest.golden b/agent/xds/testdata/builtin_extension/listeners/lua-outbound-applies-to-local-upstreams.latest.golden
index e6859902f5a6..cc127758564b 100644
--- a/agent/xds/testdata/builtin_extension/listeners/lua-outbound-applies-to-local-upstreams.latest.golden
+++ b/agent/xds/testdata/builtin_extension/listeners/lua-outbound-applies-to-local-upstreams.latest.golden
@@ -44,7 +44,9 @@
                     "name": "envoy.filters.http.lua",
                     "typedConfig": {
                       "@type": "type.googleapis.com/envoy.extensions.filters.http.lua.v3.Lua",
-                      "inlineCode": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      "defaultSourceCode": {
+                        "inlineString": "\nfunction envoy_on_request(request_handle)\n  request_handle:headers():add(\"test\", \"test\")\nend"
+                      }
                     }
                   },
                   {