diff --git a/components/serverless/.gitignore b/components/serverless/.gitignore
index 259403fd8..f4a4a637f 100644
--- a/components/serverless/.gitignore
+++ b/components/serverless/.gitignore
@@ -28,3 +28,6 @@ vendor/
 cover.out
 filered.cov
 log_config.yaml
+
+# Directory with temporary files used to do development
+hack/test_files
\ No newline at end of file
diff --git a/components/serverless/Makefile b/components/serverless/Makefile
index 70ba6b042..ac3884752 100644
--- a/components/serverless/Makefile
+++ b/components/serverless/Makefile
@@ -11,8 +11,6 @@ override VERIFY_IGNORE := /vendor\|/automock\|/pkg/apis/serverless/v1alpha2/zz_g
 
 # Image URL to use all building/pushing image targets
 IMG ?= $(APP_NAME):latest
-# Produce CRDs that work back to Kubernetes 1.11 (no version conversion)
-CRD_OPTIONS ?= "crd:trivialVersions=true,crdVersions=v1"
 
 # Get the currently used golang install path (in GOPATH/bin, unless GOBIN is set)
 ifeq (,$(shell go env GOBIN))
@@ -34,21 +32,20 @@ test-local:
 	@go tool cover -func=/tmp/artifacts/cover.out | grep total | awk '{print $$3}'
 
 # Generate manifests e.g. CRD, RBAC etc.
-CONTROLLER_GEN_VERSION=v0.6.2
-CONFIGOPERATOR = config/operator
+CONTROLLER_GEN_VERSION=v0.9.2
 
 .PHONY: manifests
 manifests: controller-gen-local generate-local
 	@make -C ${PROJECT_ROOT} kustomize
-	$(CONTROLLER_GEN) $(CRD_OPTIONS) rbac:roleName=serverless webhook paths="./..." \
+	$(CONTROLLER_GEN) rbac:roleName=serverless crd webhook paths="./..." \
 		object:headerFile=hack/boilerplate.go.txt \
-		output:crd:artifacts:config=$(CONFIGOPERATOR)/crd/bases \
-		output:rbac:artifacts:config=$(CONFIGOPERATOR)/rbac \
-		output:webhook:artifacts:config=$(CONFIGOPERATOR)/webhook
-	$(KUSTOMIZE) build $(CONFIGOPERATOR)/crd > $(CONFIGOPERATOR)/crd/crd-serverless.yaml
-	cp $(CONFIGOPERATOR)/crd/crd-serverless.yaml $(PROJECT_ROOT)/config/serverless/templates/crds.yaml
-# TODO: Fix it. Now this docu is in https://kyma-project.io/#/serverless-manager/user/resources/06-10-function-cr?id=custom-resource-parameters. Remove table-gen from kyma.
-# (cd ../../hack/table-gen && make serverless-docs )
+		output:crd:artifacts:config=config/crd/bases \
+		output:rbac:artifacts:config=config/rbac \
+		output:webhook:artifacts:config=config/webhook
+	$(KUSTOMIZE) build config/crd > config/crd/crd-serverless.yaml
+	cp config/crd/crd-serverless.yaml $(PROJECT_ROOT)/config/serverless/templates/crds.yaml
+	# TODO: Fix it. Now this docu is in https://kyma-project.io/#/serverless-manager/user/resources/06-10-function-cr?id=custom-resource-parameters. Remove table-gen from kyma.
+	# (cd ../../hack/table-gen && make serverless-docs )
 
 # Generate code
 .PHONY: generate-local
diff --git a/components/serverless/config/crd/bases/serverless.kyma-project.io_functions.yaml b/components/serverless/config/crd/bases/serverless.kyma-project.io_functions.yaml
index 9b76cc746..bcd2de34e 100644
--- a/components/serverless/config/crd/bases/serverless.kyma-project.io_functions.yaml
+++ b/components/serverless/config/crd/bases/serverless.kyma-project.io_functions.yaml
@@ -1,10 +1,9 @@
-
 ---
 apiVersion: apiextensions.k8s.io/v1
 kind: CustomResourceDefinition
 metadata:
   annotations:
-    controller-gen.kubebuilder.io/version: v0.6.2
+    controller-gen.kubebuilder.io/version: v0.9.2
   creationTimestamp: null
   name: functions.serverless.kyma-project.io
 spec:
@@ -112,6 +111,7 @@ spec:
                           required:
                           - key
                           type: object
+                          x-kubernetes-map-type: atomic
                         fieldRef:
                           description: 'Selects a field of the pod: supports metadata.name,
                             metadata.namespace, `metadata.labels[''<KEY>'']`, `metadata.annotations[''<KEY>'']`,
@@ -129,6 +129,7 @@ spec:
                           required:
                           - fieldPath
                           type: object
+                          x-kubernetes-map-type: atomic
                         resourceFieldRef:
                           description: 'Selects a resource of the container: only
                             resources limits and requests (limits.cpu, limits.memory,
@@ -153,6 +154,7 @@ spec:
                           required:
                           - resource
                           type: object
+                          x-kubernetes-map-type: atomic
                         secretKeyRef:
                           description: Selects a key of a secret in the pod's namespace
                           properties:
@@ -171,6 +173,7 @@ spec:
                           required:
                           - key
                           type: object
+                          x-kubernetes-map-type: atomic
                       type: object
                   required:
                   - name
@@ -234,6 +237,10 @@ spec:
                             type: object
                         type: object
                     type: object
+                    x-kubernetes-validations:
+                    - message: Use profile or resources
+                      rule: has(self.profile) && !has(self.resources) || !has(self.profile)
+                        && has(self.resources)
                   function:
                     description: Specifies resources requested by the Function's Pod.
                     properties:
@@ -271,6 +278,10 @@ spec:
                             type: object
                         type: object
                     type: object
+                    x-kubernetes-validations:
+                    - message: Use profile or resources
+                      rule: has(self.profile) && !has(self.resources) || !has(self.profile)
+                        && has(self.resources)
                 type: object
               runtime:
                 description: Specifies the runtime of the Function. The available
@@ -480,9 +491,3 @@ spec:
         specReplicasPath: .spec.replicas
         statusReplicasPath: .status.replicas
       status: {}
-status:
-  acceptedNames:
-    kind: ""
-    plural: ""
-  conditions: []
-  storedVersions: []
diff --git a/components/serverless/config/rbac/role.yaml b/components/serverless/config/rbac/role.yaml
index efb29f9a0..4570315c4 100644
--- a/components/serverless/config/rbac/role.yaml
+++ b/components/serverless/config/rbac/role.yaml
@@ -1,4 +1,3 @@
-
 ---
 apiVersion: rbac.authorization.k8s.io/v1
 kind: ClusterRole
diff --git a/components/serverless/config/webhook/manifests.yaml b/components/serverless/config/webhook/manifests.yaml
index e8f40b203..a86be4045 100644
--- a/components/serverless/config/webhook/manifests.yaml
+++ b/components/serverless/config/webhook/manifests.yaml
@@ -1,4 +1,3 @@
-
 ---
 apiVersion: admissionregistration.k8s.io/v1
 kind: MutatingWebhookConfiguration
diff --git a/components/serverless/internal/testenv/testenv.go b/components/serverless/internal/testenv/testenv.go
index e96026099..c79cb6c89 100644
--- a/components/serverless/internal/testenv/testenv.go
+++ b/components/serverless/internal/testenv/testenv.go
@@ -45,10 +45,10 @@ func buildCrdPath(wd string) string {
 	crdPath := []string{"/"}
 	for _, path := range wdPath {
 		crdPath = append(crdPath, path)
-		if path == "serverless" {
+		if path == "components" {
 			break
 		}
 	}
-	crdPath = append(crdPath, "config", "crd", "bases")
+	crdPath = append(crdPath, "serverless", "config", "crd", "bases")
 	return filepath.Join(crdPath...)
 }
diff --git a/components/serverless/pkg/apis/serverless/v1alpha2/function_types.go b/components/serverless/pkg/apis/serverless/v1alpha2/function_types.go
index 0a5020dee..c6b7e9875 100644
--- a/components/serverless/pkg/apis/serverless/v1alpha2/function_types.go
+++ b/components/serverless/pkg/apis/serverless/v1alpha2/function_types.go
@@ -130,10 +130,12 @@ type ScaleConfig struct {
 type ResourceConfiguration struct {
 	// Specifies resources requested by the build Job's Pod.
 	// +optional
+	// +kubebuilder:validation:XValidation:message="Use profile or resources",rule="has(self.profile) && !has(self.resources) || !has(self.profile) && has(self.resources)"
 	Build *ResourceRequirements `json:"build,omitempty"`
 
 	// Specifies resources requested by the Function's Pod.
 	// +optional
+	// +kubebuilder:validation:XValidation:message="Use profile or resources",rule="has(self.profile) && !has(self.resources) || !has(self.profile) && has(self.resources)"
 	Function *ResourceRequirements `json:"function,omitempty"`
 }
 
diff --git a/components/serverless/pkg/apis/serverless/v1alpha2/function_x_validation_test.go b/components/serverless/pkg/apis/serverless/v1alpha2/function_x_validation_test.go
new file mode 100644
index 000000000..df19ceb8a
--- /dev/null
+++ b/components/serverless/pkg/apis/serverless/v1alpha2/function_x_validation_test.go
@@ -0,0 +1,142 @@
+package v1alpha2_test
+
+import (
+	"context"
+	"github.com/kyma-project/kyma/components/function-controller/internal/testenv"
+	serverlessv1alpha2 "github.com/kyma-project/kyma/components/function-controller/pkg/apis/serverless/v1alpha2"
+	"github.com/stretchr/testify/assert"
+	"github.com/stretchr/testify/require"
+	corev1 "k8s.io/api/core/v1"
+	k8serrors "k8s.io/apimachinery/pkg/api/errors"
+	metav1 "k8s.io/apimachinery/pkg/apis/meta/v1"
+	"testing"
+)
+
+func Test_XKubernetesValidations(t *testing.T) {
+	ctx := context.TODO()
+	k8sClient, testEnv := testenv.Start(t)
+	defer testenv.Stop(t, testEnv)
+
+	testNs := corev1.Namespace{
+		ObjectMeta: metav1.ObjectMeta{Name: "test"},
+	}
+	err := k8sClient.Create(ctx, &testNs)
+	require.NoError(t, err)
+
+	testCases := map[string]struct {
+		fn             *serverlessv1alpha2.Function
+		expectedErr    bool
+		expectedErrMsg string
+		fieldPath      string
+	}{
+		"Resource and Profiles used together in function": {
+			fn: &serverlessv1alpha2.Function{
+				ObjectMeta: metav1.ObjectMeta{
+					GenerateName: "test",
+					Namespace:    "test",
+				},
+				Spec: serverlessv1alpha2.FunctionSpec{
+					ResourceConfiguration: &serverlessv1alpha2.ResourceConfiguration{Function: &serverlessv1alpha2.ResourceRequirements{
+						Profile:   "Test",
+						Resources: &corev1.ResourceRequirements{},
+					}},
+				},
+			},
+			expectedErr:    true,
+			expectedErrMsg: "Use profile or resources",
+			fieldPath:      "spec.resourceConfiguration.function",
+		},
+		"Profile set only for function": {
+			fn: &serverlessv1alpha2.Function{
+				ObjectMeta: metav1.ObjectMeta{
+					GenerateName: "test",
+					Namespace:    "test",
+				},
+				Spec: serverlessv1alpha2.FunctionSpec{
+					ResourceConfiguration: &serverlessv1alpha2.ResourceConfiguration{Function: &serverlessv1alpha2.ResourceRequirements{
+						Profile: "Test",
+					}},
+				},
+			},
+		},
+		"Resource set only for function": {
+			fn: &serverlessv1alpha2.Function{
+				ObjectMeta: metav1.ObjectMeta{
+					GenerateName: "test",
+					Namespace:    "test",
+				},
+				Spec: serverlessv1alpha2.FunctionSpec{
+					ResourceConfiguration: &serverlessv1alpha2.ResourceConfiguration{Function: &serverlessv1alpha2.ResourceRequirements{
+						Profile: "Test",
+					}},
+				},
+			},
+		},
+		"Resource and Profiles used together in buildJob": {
+			fn: &serverlessv1alpha2.Function{
+				ObjectMeta: metav1.ObjectMeta{
+					GenerateName: "test",
+					Namespace:    "test",
+				},
+				Spec: serverlessv1alpha2.FunctionSpec{
+					ResourceConfiguration: &serverlessv1alpha2.ResourceConfiguration{Build: &serverlessv1alpha2.ResourceRequirements{
+						Profile:   "Test",
+						Resources: &corev1.ResourceRequirements{},
+					}},
+				},
+			},
+			expectedErr:    true,
+			expectedErrMsg: "Use profile or resources",
+			fieldPath:      "spec.resourceConfiguration.build",
+		},
+		"Profile set only for buildJob": {
+			fn: &serverlessv1alpha2.Function{
+				ObjectMeta: metav1.ObjectMeta{
+					GenerateName: "test",
+					Namespace:    "test",
+				},
+				Spec: serverlessv1alpha2.FunctionSpec{
+					ResourceConfiguration: &serverlessv1alpha2.ResourceConfiguration{Build: &serverlessv1alpha2.ResourceRequirements{
+						Profile: "Test",
+					}},
+				},
+			},
+		},
+		"Resource set only for buildJob": {
+			fn: &serverlessv1alpha2.Function{
+				ObjectMeta: metav1.ObjectMeta{
+					GenerateName: "test",
+					Namespace:    "test",
+				},
+				Spec: serverlessv1alpha2.FunctionSpec{
+					ResourceConfiguration: &serverlessv1alpha2.ResourceConfiguration{Build: &serverlessv1alpha2.ResourceRequirements{
+						Profile: "Test",
+					}},
+				},
+			},
+		},
+	}
+	for name, tc := range testCases {
+		t.Run(name, func(t *testing.T) {
+			//GIVEN
+
+			//WHEN
+			err := k8sClient.Create(ctx, tc.fn)
+			//THEN
+			if tc.expectedErr {
+				require.Error(t, err)
+				errStatus, ok := err.(*k8serrors.StatusError)
+				require.True(t, ok)
+				causes := errStatus.Status().Details.Causes
+				require.Len(t, causes, 1)
+				cause := causes[0]
+				assert.Equal(t, metav1.CauseTypeFieldValueInvalid, cause.Type)
+				assert.Equal(t, tc.fieldPath, cause.Field)
+				assert.Contains(t, cause.Message, tc.expectedErrMsg)
+			} else {
+				require.NoError(t, err)
+				require.NoError(t, k8sClient.Delete(ctx, tc.fn))
+			}
+		})
+	}
+}
diff --git a/config/serverless/templates/crds.yaml b/config/serverless/templates/crds.yaml
index b5fb5a81e..38cc5d191 100644
--- a/config/serverless/templates/crds.yaml
+++ b/config/serverless/templates/crds.yaml
@@ -2,7 +2,7 @@ apiVersion: apiextensions.k8s.io/v1
 kind: CustomResourceDefinition
 metadata:
   annotations:
-    controller-gen.kubebuilder.io/version: v0.6.2
+    controller-gen.kubebuilder.io/version: v0.9.2
   creationTimestamp: null
   name: functions.serverless.kyma-project.io
 spec:
@@ -110,6 +110,7 @@ spec:
                           required:
                           - key
                           type: object
+                          x-kubernetes-map-type: atomic
                         fieldRef:
                           description: 'Selects a field of the pod: supports metadata.name,
                             metadata.namespace, `metadata.labels[''<KEY>'']`, `metadata.annotations[''<KEY>'']`,
@@ -127,6 +128,7 @@ spec:
                           required:
                           - fieldPath
                           type: object
+                          x-kubernetes-map-type: atomic
                         resourceFieldRef:
                           description: 'Selects a resource of the container: only
                             resources limits and requests (limits.cpu, limits.memory,
@@ -151,6 +153,7 @@ spec:
                           required:
                           - resource
                           type: object
+                          x-kubernetes-map-type: atomic
                         secretKeyRef:
                           description: Selects a key of a secret in the pod's namespace
                           properties:
@@ -169,6 +172,7 @@ spec:
                           required:
                           - key
                           type: object
+                          x-kubernetes-map-type: atomic
                       type: object
                   required:
                   - name
@@ -232,6 +236,10 @@ spec:
                             type: object
                         type: object
                     type: object
+                    x-kubernetes-validations:
+                    - message: Use profile or resources
+                      rule: has(self.profile) && !has(self.resources) || !has(self.profile)
+                        && has(self.resources)
                   function:
                     description: Specifies resources requested by the Function's Pod.
                     properties:
@@ -269,6 +277,10 @@ spec:
                             type: object
                         type: object
                     type: object
+                    x-kubernetes-validations:
+                    - message: Use profile or resources
+                      rule: has(self.profile) && !has(self.resources) || !has(self.profile)
+                        && has(self.resources)
                 type: object
               runtime:
                 description: Specifies the runtime of the Function. The available
@@ -478,9 +490,3 @@ spec:
         specReplicasPath: .spec.replicas
         statusReplicasPath: .status.replicas
       status: {}
-status:
-  acceptedNames:
-    kind: ""
-    plural: ""
-  conditions: []
-  storedVersions: []
diff --git a/config/serverless/values.yaml b/config/serverless/values.yaml
index 1f517b599..3b673c683 100644
--- a/config/serverless/values.yaml
+++ b/config/serverless/values.yaml
@@ -82,19 +82,19 @@ global:
       directory: "prod"
     function_controller:
       name: "function-controller"
-      version: "PR-356"
+      version: "PR-338"
       directory: "dev"
     function_webhook:
       name: "function-webhook"
-      version: "PR-356"
+      version: "PR-338"
       directory: "dev"
     function_build_init:
       name: "function-build-init"
-      version: "PR-356"
+      version: "PR-338"
       directory: "dev"
     function_registry_gc:
       name: "function-registry-gc"
-      version: "PR-356"
+      version: "PR-338"
       directory: "dev"
     function_runtime_nodejs16:
       name: "function-runtime-nodejs16"