diff --git a/kong-3.10.0-0.rockspec b/kong-3.10.0-0.rockspec
index 827a13ed6bf..f1b503720b8 100644
--- a/kong-3.10.0-0.rockspec
+++ b/kong-3.10.0-0.rockspec
@@ -247,6 +247,7 @@ build = {
     ["kong.runloop.plugin_servers.rpc.util"] = "kong/runloop/plugin_servers/rpc/util.lua",
     ["kong.runloop.plugin_servers.rpc.mp_rpc"] = "kong/runloop/plugin_servers/rpc/mp_rpc.lua",
     ["kong.runloop.plugin_servers.rpc.pb_rpc"] = "kong/runloop/plugin_servers/rpc/pb_rpc.lua",
+    ["kong.runloop.upstream_retry"] = "kong/runloop/upstream_retry.lua",
     ["kong.runloop.wasm"] = "kong/runloop/wasm.lua",
     ["kong.runloop.wasm.plugins"] = "kong/runloop/wasm/plugins.lua",
     ["kong.runloop.wasm.properties"] = "kong/runloop/wasm/properties.lua",
diff --git a/kong/clustering/compat/removed_fields.lua b/kong/clustering/compat/removed_fields.lua
index 77284a91011..7c50ef514bc 100644
--- a/kong/clustering/compat/removed_fields.lua
+++ b/kong/clustering/compat/removed_fields.lua
@@ -233,6 +233,6 @@ return {
     session = {
       "hash_subject",
       "store_metadata",
-    }
+    },
   }
 }
diff --git a/kong/runloop/upstream_retry.lua b/kong/runloop/upstream_retry.lua
new file mode 100644
index 00000000000..d38147f9da6
--- /dev/null
+++ b/kong/runloop/upstream_retry.lua
@@ -0,0 +1,46 @@
+-- This software is copyright Kong Inc. and its licensors.
+-- Use of the software is subject to the agreement between your organization
+-- and Kong Inc. If there is no such agreement, use is governed by and
+-- subject to the terms of the Kong Master Software License Agreement found
+-- at https://konghq.com/enterprisesoftwarelicense/.
+-- [ END OF LICENSE 0867164ffc95e54f04670b5169c09574bdbd9bba ]
+
+local kset_next_upstream
+if ngx.config.subsystem ~= "stream" then
+  kset_next_upstream = require("resty.kong.upstream").set_next_upstream
+end
+
+local ngx = ngx
+local log = ngx.log
+local ERR = ngx.ERR
+
+local function set_proxy_next_upstream(next_upstream)
+  local err = kset_next_upstream(unpack(next_upstream))
+  if err then
+    log(ERR, "failed to set next upstream: ", err)
+  end
+
+  if ngx.ctx and ngx.ctx.balancer_data then
+    ngx.ctx.balancer_data.next_upstream = next_upstream
+  end
+end
+
+local function fallback_proxy_next_upstream()
+  if not ngx.ctx.balancer_data then
+    return
+  end
+
+  if not ngx.ctx.balancer_data.next_upstream then
+    return
+  end
+
+  local err = kset_next_upstream(unpack(ngx.ctx.balancer_data.next_upstream))
+  if err then
+    log(ERR, "failed to set next upstream: ", err)
+  end
+end
+
+return {
+  set_proxy_next_upstream = set_proxy_next_upstream,
+  fallback_proxy_next_upstream = fallback_proxy_next_upstream,
+}
diff --git a/kong/templates/nginx_kong.lua b/kong/templates/nginx_kong.lua
index 470fa61e459..1320e8c70cc 100644
--- a/kong/templates/nginx_kong.lua
+++ b/kong/templates/nginx_kong.lua
@@ -357,9 +357,11 @@ server {
           -- we need to re-set them here to the new nginx request.
           local ctx = ngx.ctx
           local upstream_ssl = require("kong.runloop.upstream_ssl")
+          local upstream_retry = require("kong.runloop.upstream_retry")
 
           upstream_ssl.set_service_ssl(ctx)
           upstream_ssl.fallback_upstream_client_cert(ctx)
+          upstream_retry.fallback_proxy_next_upstream()
         }
         access_by_lua_block        {;}
         header_filter_by_lua_block {;}