diff --git a/lambda-layer/.gitignore b/lambda-layer/.gitignore
new file mode 100644
index 0000000000..1b6985c009
--- /dev/null
+++ b/lambda-layer/.gitignore
@@ -0,0 +1,5 @@
+# Ignore Gradle project-specific cache directory
+.gradle
+
+# Ignore Gradle build output directory
+build
diff --git a/lambda-layer/build-layer.sh b/lambda-layer/build-layer.sh
new file mode 100755
index 0000000000..b99fce80c5
--- /dev/null
+++ b/lambda-layer/build-layer.sh
@@ -0,0 +1,48 @@
+#!/bin/bash
+
+SOURCEDIR="$( cd "$( dirname "${BASH_SOURCE[0]}" )" &> /dev/null && pwd )"
+
+
+## Get OTel version
+file="$SOURCEDIR/../.github/patches/versions"
+version=$(awk -F'=v' '/OTEL_JAVA_INSTRUMENTATION_VERSION/ {print $2}' "$file")
+echo "Found OTEL Version: ${version}"
+# Exit if the version is empty or null
+if [[ -z "$version" ]]; then
+  echo "Error: Version could not be found in ${file}."
+  exit 1
+fi
+
+
+## Clone and Patch the OpenTelemetry Java Instrumentation Repository
+git clone https://github.com/open-telemetry/opentelemetry-java-instrumentation.git
+pushd opentelemetry-java-instrumentation
+git checkout v${version} -b tag-v${version}
+
+# This patch is for Lambda related context propagation
+patch -p1 < "$SOURCEDIR"/patches/opentelemetry-java-instrumentation.patch
+
+# There is another patch in the .github/patches directory for other changes. We should apply them too for consistency.
+patch -p1 < "$SOURCEDIR"/../.github/patches/opentelemetry-java-instrumentation.patch
+
+git add -A
+git commit -m "Create patch version"
+./gradlew publishToMavenLocal
+popd
+rm -rf opentelemetry-java-instrumentation
+
+
+## Build the ADOT Java from current source
+pushd "$SOURCEDIR"/..
+patch  -p1 < "${SOURCEDIR}"/patches/aws-otel-java-instrumentation.patch
+CI=false ./gradlew publishToMavenLocal -Prelease.version=${version}-adot-lambda1
+popd
+
+
+## Build ADOT Lambda Java SDK Layer Code
+./gradlew build
+
+
+## Copy ADOT Java Agent downloaded using Gradle task and bundle it with the Lambda handler script
+cp "$SOURCEDIR"/build/javaagent/aws-opentelemetry-agent*.jar ./opentelemetry-javaagent.jar
+zip -qr opentelemetry-javaagent-layer.zip opentelemetry-javaagent.jar otel-handler
diff --git a/lambda-layer/build.gradle.kts b/lambda-layer/build.gradle.kts
new file mode 100644
index 0000000000..92da026df2
--- /dev/null
+++ b/lambda-layer/build.gradle.kts
@@ -0,0 +1,46 @@
+plugins {
+  java
+
+  id("com.diffplug.spotless")
+}
+
+base.archivesBaseName = "aws-otel-lambda-java-extensions"
+group = "software.amazon.opentelemetry.lambda"
+
+repositories {
+  mavenCentral()
+  mavenLocal()
+}
+
+java {
+  sourceCompatibility = JavaVersion.VERSION_1_8
+  targetCompatibility = JavaVersion.VERSION_1_8
+}
+
+spotless {
+  java {
+    googleJavaFormat("1.15.0")
+  }
+}
+
+val javaagentDependency by configurations.creating {
+  extendsFrom()
+}
+
+dependencies {
+  compileOnly(platform("io.opentelemetry:opentelemetry-bom:1.32.1"))
+  compileOnly(platform("io.opentelemetry:opentelemetry-bom-alpha:1.32.1-alpha"))
+  // Already included in wrapper so compileOnly
+  compileOnly("io.opentelemetry:opentelemetry-sdk-extension-autoconfigure-spi")
+  compileOnly("io.opentelemetry:opentelemetry-sdk-extension-aws")
+  javaagentDependency("software.amazon.opentelemetry:aws-opentelemetry-agent:1.32.1-adot-lambda1")
+}
+
+tasks.register<Copy>("download") {
+  from(javaagentDependency)
+  into("$buildDir/javaagent")
+}
+
+tasks.named("build") {
+  dependsOn("download")
+}
diff --git a/lambda-layer/gradle/wrapper/gradle-wrapper.jar b/lambda-layer/gradle/wrapper/gradle-wrapper.jar
new file mode 100644
index 0000000000..943f0cbfa7
Binary files /dev/null and b/lambda-layer/gradle/wrapper/gradle-wrapper.jar differ
diff --git a/lambda-layer/gradle/wrapper/gradle-wrapper.properties b/lambda-layer/gradle/wrapper/gradle-wrapper.properties
new file mode 100644
index 0000000000..37aef8d3f0
--- /dev/null
+++ b/lambda-layer/gradle/wrapper/gradle-wrapper.properties
@@ -0,0 +1,6 @@
+distributionBase=GRADLE_USER_HOME
+distributionPath=wrapper/dists
+distributionUrl=https\://services.gradle.org/distributions/gradle-8.1.1-bin.zip
+networkTimeout=10000
+zipStoreBase=GRADLE_USER_HOME
+zipStorePath=wrapper/dists
diff --git a/lambda-layer/gradlew b/lambda-layer/gradlew
new file mode 100755
index 0000000000..5bba57aa19
--- /dev/null
+++ b/lambda-layer/gradlew
@@ -0,0 +1,245 @@
+
+#!/bin/sh
+
+#
+# Copyright © 2015-2021 the original authors.
+#
+# Licensed under the Apache License, Version 2.0 (the "License");
+# you may not use this file except in compliance with the License.
+# You may obtain a copy of the License at
+#
+#      https://www.apache.org/licenses/LICENSE-2.0
+#
+# Unless required by applicable law or agreed to in writing, software
+# distributed under the License is distributed on an "AS IS" BASIS,
+# WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+# See the License for the specific language governing permissions and
+# limitations under the License.
+#
+
+##############################################################################
+#
+#   Gradle start up script for POSIX generated by Gradle.
+#
+#   Important for running:
+#
+#   (1) You need a POSIX-compliant shell to run this script. If your /bin/sh is
+#       noncompliant, but you have some other compliant shell such as ksh or
+#       bash, then to run this script, type that shell name before the whole
+#       command line, like:
+#
+#           ksh Gradle
+#
+#       Busybox and similar reduced shells will NOT work, because this script
+#       requires all of these POSIX shell features:
+#         * functions;
+#         * expansions «$var», «${var}», «${var:-default}», «${var+SET}»,
+#           «${var#prefix}», «${var%suffix}», and «$( cmd )»;
+#         * compound commands having a testable exit status, especially «case»;
+#         * various built-in commands including «command», «set», and «ulimit».
+#
+#   Important for patching:
+#
+#   (2) This script targets any POSIX shell, so it avoids extensions provided
+#       by Bash, Ksh, etc; in particular arrays are avoided.
+#
+#       The "traditional" practice of packing multiple parameters into a
+#       space-separated string is a well documented source of bugs and security
+#       problems, so this is (mostly) avoided, by progressively accumulating
+#       options in "$@", and eventually passing that to Java.
+#
+#       Where the inherited environment variables (DEFAULT_JVM_OPTS, JAVA_OPTS,
+#       and GRADLE_OPTS) rely on word-splitting, this is performed explicitly;
+#       see the in-line comments for details.
+#
+#       There are tweaks for specific operating systems such as AIX, CygWin,
+#       Darwin, MinGW, and NonStop.
+#
+#   (3) This script is generated from the Groovy template
+#       https://github.com/gradle/gradle/blob/HEAD/subprojects/plugins/src/main/resources/org/gradle/api/internal/plugins/unixStartScript.txt
+#       within the Gradle project.
+#
+#       You can find Gradle at https://github.com/gradle/gradle/.
+#
+##############################################################################
+
+# Attempt to set APP_HOME
+
+# Resolve links: $0 may be a link
+app_path=$0
+
+# Need this for daisy-chained symlinks.
+while
+    APP_HOME=${app_path%"${app_path##*/}"}  # leaves a trailing /; empty if no leading path
+    [ -h "$app_path" ]
+do
+    ls=$( ls -ld "$app_path" )
+    link=${ls#*' -> '}
+    case $link in             #(
+      /*)   app_path=$link ;; #(
+      *)    app_path=$APP_HOME$link ;;
+    esac
+done
+
+# This is normally unused
+# shellcheck disable=SC2034
+APP_BASE_NAME=${0##*/}
+APP_HOME=$( cd "${APP_HOME:-./}" && pwd -P ) || exit
+
+# Add default JVM options here. You can also use JAVA_OPTS and GRADLE_OPTS to pass JVM options to this script.
+DEFAULT_JVM_OPTS='"-Xmx64m" "-Xms64m"'
+
+# Use the maximum available, or set MAX_FD != -1 to use that value.
+MAX_FD=maximum
+
+warn () {
+    echo "$*"
+} >&2
+
+die () {
+    echo
+    echo "$*"
+    echo
+    exit 1
+} >&2
+
+# OS specific support (must be 'true' or 'false').
+cygwin=false
+msys=false
+darwin=false
+nonstop=false
+case "$( uname )" in                #(
+  CYGWIN* )         cygwin=true  ;; #(
+  Darwin* )         darwin=true  ;; #(
+  MSYS* | MINGW* )  msys=true    ;; #(
+  NONSTOP* )        nonstop=true ;;
+esac
+
+CLASSPATH=$APP_HOME/gradle/wrapper/gradle-wrapper.jar
+
+
+# Determine the Java command to use to start the JVM.
+if [ -n "$JAVA_HOME" ] ; then
+    if [ -x "$JAVA_HOME/jre/sh/java" ] ; then
+        # IBM's JDK on AIX uses strange locations for the executables
+        JAVACMD=$JAVA_HOME/jre/sh/java
+    else
+        JAVACMD=$JAVA_HOME/bin/java
+    fi
+    if [ ! -x "$JAVACMD" ] ; then
+        die "ERROR: JAVA_HOME is set to an invalid directory: $JAVA_HOME
+
+Please set the JAVA_HOME variable in your environment to match the
+location of your Java installation."
+    fi
+else
+    JAVACMD=java
+    which java >/dev/null 2>&1 || die "ERROR: JAVA_HOME is not set and no 'java' command could be found in your PATH.
+
+Please set the JAVA_HOME variable in your environment to match the
+location of your Java installation."
+fi
+
+# Increase the maximum file descriptors if we can.
+if ! "$cygwin" && ! "$darwin" && ! "$nonstop" ; then
+    case $MAX_FD in #(
+      max*)
+        # In POSIX sh, ulimit -H is undefined. That's why the result is checked to see if it worked.
+        # shellcheck disable=SC3045
+        MAX_FD=$( ulimit -H -n ) ||
+            warn "Could not query maximum file descriptor limit"
+    esac
+    case $MAX_FD in  #(
+      '' | soft) :;; #(
+      *)
+        # In POSIX sh, ulimit -n is undefined. That's why the result is checked to see if it worked.
+        # shellcheck disable=SC3045
+        ulimit -n "$MAX_FD" ||
+            warn "Could not set maximum file descriptor limit to $MAX_FD"
+    esac
+fi
+
+# Collect all arguments for the java command, stacking in reverse order:
+#   * args from the command line
+#   * the main class name
+#   * -classpath
+#   * -D...appname settings
+#   * --module-path (only if needed)
+#   * DEFAULT_JVM_OPTS, JAVA_OPTS, and GRADLE_OPTS environment variables.
+
+# For Cygwin or MSYS, switch paths to Windows format before running java
+if "$cygwin" || "$msys" ; then
+    APP_HOME=$( cygpath --path --mixed "$APP_HOME" )
+    CLASSPATH=$( cygpath --path --mixed "$CLASSPATH" )
+
+    JAVACMD=$( cygpath --unix "$JAVACMD" )
+
+    # Now convert the arguments - kludge to limit ourselves to /bin/sh
+    for arg do
+        if
+            case $arg in                                #(
+              -*)   false ;;                            # don't mess with options #(
+              /?*)  t=${arg#/} t=/${t%%/*}              # looks like a POSIX filepath
+                    [ -e "$t" ] ;;                      #(
+              *)    false ;;
+            esac
+        then
+            arg=$( cygpath --path --ignore --mixed "$arg" )
+        fi
+        # Roll the args list around exactly as many times as the number of
+        # args, so each arg winds up back in the position where it started, but
+        # possibly modified.
+        #
+        # NB: a `for` loop captures its iteration list before it begins, so
+        # changing the positional parameters here affects neither the number of
+        # iterations, nor the values presented in `arg`.
+        shift                   # remove old arg
+        set -- "$@" "$arg"      # push replacement arg
+    done
+fi
+
+# Collect all arguments for the java command;
+#   * $DEFAULT_JVM_OPTS, $JAVA_OPTS, and $GRADLE_OPTS can contain fragments of
+#     shell script including quotes and variable substitutions, so put them in
+#     double quotes to make sure that they get re-expanded; and
+#   * put everything else in single quotes, so that it's not re-expanded.
+
+set -- \
+        "-Dorg.gradle.appname=$APP_BASE_NAME" \
+        -classpath "$CLASSPATH" \
+        org.gradle.wrapper.GradleWrapperMain \
+        "$@"
+
+# Stop when "xargs" is not available.
+if ! command -v xargs >/dev/null 2>&1
+then
+    die "xargs is not available"
+fi
+
+# Use "xargs" to parse quoted args.
+#
+# With -n1 it outputs one arg per line, with the quotes and backslashes removed.
+#
+# In Bash we could simply go:
+#
+#   readarray ARGS < <( xargs -n1 <<<"$var" ) &&
+#   set -- "${ARGS[@]}" "$@"
+#
+# but POSIX shell has neither arrays nor command substitution, so instead we
+# post-process each arg (as a line of input to sed) to backslash-escape any
+# character that might be a shell metacharacter, then use eval to reverse
+# that process (while maintaining the separation between arguments), and wrap
+# the whole thing up as a single "set" statement.
+#
+# This will of course break if any of these variables contains a newline or
+# an unmatched quote.
+#
+
+eval "set -- $(
+        printf '%s\n' "$DEFAULT_JVM_OPTS $JAVA_OPTS $GRADLE_OPTS" |
+        xargs -n1 |
+        sed ' s~[^-[:alnum:]+,./:=@_]~\\&~g; ' |
+        tr '\n' ' '
+    )" '"$@"'
+
+exec "$JAVACMD" "$@"
diff --git a/lambda-layer/gradlew.bat b/lambda-layer/gradlew.bat
new file mode 100644
index 0000000000..084f02df4a
--- /dev/null
+++ b/lambda-layer/gradlew.bat
@@ -0,0 +1,93 @@
+
+@rem
+@rem Copyright 2015 the original author or authors.
+@rem
+@rem Licensed under the Apache License, Version 2.0 (the "License");
+@rem you may not use this file except in compliance with the License.
+@rem You may obtain a copy of the License at
+@rem
+@rem      https://www.apache.org/licenses/LICENSE-2.0
+@rem
+@rem Unless required by applicable law or agreed to in writing, software
+@rem distributed under the License is distributed on an "AS IS" BASIS,
+@rem WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+@rem See the License for the specific language governing permissions and
+@rem limitations under the License.
+@rem
+
+@if "%DEBUG%"=="" @echo off
+@rem ##########################################################################
+@rem
+@rem  Gradle startup script for Windows
+@rem
+@rem ##########################################################################
+
+@rem Set local scope for the variables with windows NT shell
+if "%OS%"=="Windows_NT" setlocal
+
+set DIRNAME=%~dp0
+if "%DIRNAME%"=="" set DIRNAME=.
+@rem This is normally unused
+set APP_BASE_NAME=%~n0
+set APP_HOME=%DIRNAME%
+
+@rem Resolve any "." and ".." in APP_HOME to make it shorter.
+for %%i in ("%APP_HOME%") do set APP_HOME=%%~fi
+
+@rem Add default JVM options here. You can also use JAVA_OPTS and GRADLE_OPTS to pass JVM options to this script.
+set DEFAULT_JVM_OPTS="-Xmx64m" "-Xms64m"
+
+@rem Find java.exe
+if defined JAVA_HOME goto findJavaFromJavaHome
+
+set JAVA_EXE=java.exe
+%JAVA_EXE% -version >NUL 2>&1
+if %ERRORLEVEL% equ 0 goto execute
+
+echo.
+echo ERROR: JAVA_HOME is not set and no 'java' command could be found in your PATH.
+echo.
+echo Please set the JAVA_HOME variable in your environment to match the
+echo location of your Java installation.
+
+goto fail
+
+:findJavaFromJavaHome
+set JAVA_HOME=%JAVA_HOME:"=%
+set JAVA_EXE=%JAVA_HOME%/bin/java.exe
+
+if exist "%JAVA_EXE%" goto execute
+
+echo.
+echo ERROR: JAVA_HOME is set to an invalid directory: %JAVA_HOME%
+echo.
+echo Please set the JAVA_HOME variable in your environment to match the
+echo location of your Java installation.
+
+goto fail
+
+:execute
+@rem Setup the command line
+
+set CLASSPATH=%APP_HOME%\gradle\wrapper\gradle-wrapper.jar
+
+
+@rem Execute Gradle
+"%JAVA_EXE%" %DEFAULT_JVM_OPTS% %JAVA_OPTS% %GRADLE_OPTS% "-Dorg.gradle.appname=%APP_BASE_NAME%" -classpath "%CLASSPATH%" org.gradle.wrapper.GradleWrapperMain %*
+
+:end
+@rem End local scope for the variables with windows NT shell
+if %ERRORLEVEL% equ 0 goto mainEnd
+
+:fail
+rem Set variable GRADLE_EXIT_CONSOLE if you need the _script_ return code instead of
+rem the _cmd.exe /c_ return code!
+set EXIT_CODE=%ERRORLEVEL%
+if %EXIT_CODE% equ 0 set EXIT_CODE=1
+if not ""=="%GRADLE_EXIT_CONSOLE%" exit %EXIT_CODE%
+exit /b %EXIT_CODE%
+
+:mainEnd
+if "%OS%"=="Windows_NT" endlocal
+
+:omega
diff --git a/lambda-layer/otel-handler b/lambda-layer/otel-handler
new file mode 100644
index 0000000000..9104e2a7b2
--- /dev/null
+++ b/lambda-layer/otel-handler
@@ -0,0 +1,24 @@
+#!/bin/bash
+
+export OTEL_INSTRUMENTATION_AWS_SDK_EXPERIMENTAL_SPAN_ATTRIBUTES=true
+
+export OTEL_PROPAGATORS="${OTEL_PROPAGATORS:-xray,tracecontext,b3,b3multi}"
+
+# Temporarily set OTEL_SERVICE_NAME variable to work around but in javaagent not handling
+# OTEL_RESOURCE_ATTRIBUTES as set in otel-handler-upstream. It doesn't hurt to apply this
+# to wrapper as well.
+# TODO(anuraaga): Move to opentelemetry-lambda
+export OTEL_SERVICE_NAME=${OTEL_SERVICE_NAME:-${AWS_LAMBDA_FUNCTION_NAME}}
+
+export JAVA_TOOL_OPTIONS="-javaagent:/opt/opentelemetry-javaagent.jar ${JAVA_TOOL_OPTIONS}"
+
+if [[ $OTEL_RESOURCE_ATTRIBUTES != *"service.name="* ]]; then
+  export OTEL_RESOURCE_ATTRIBUTES="service.name=${AWS_LAMBDA_FUNCTION_NAME},${OTEL_RESOURCE_ATTRIBUTES}"
+fi
+
+export OTEL_INSTRUMENTATION_AWS_LAMBDA_FLUSH_TIMEOUT=10000
+
+# Disable the Application Signals runtime metrics since we are on Lambda
+export OTEL_AWS_APPLICATION_SIGNALS_RUNTIME_ENABLED=false
+
+exec "$@"
diff --git a/lambda-layer/patches/aws-otel-java-instrumentation.patch b/lambda-layer/patches/aws-otel-java-instrumentation.patch
new file mode 100644
index 0000000000..0a65783bfb
--- /dev/null
+++ b/lambda-layer/patches/aws-otel-java-instrumentation.patch
@@ -0,0 +1,13 @@
+diff --git a/dependencyManagement/build.gradle.kts b/dependencyManagement/build.gradle.kts
+index 9493189..6090207 100644
+--- a/dependencyManagement/build.gradle.kts
++++ b/dependencyManagement/build.gradle.kts
+@@ -27,7 +27,7 @@ data class DependencySet(val group: String, val version: String, val modules: Li
+ val TEST_SNAPSHOTS = rootProject.findProperty("testUpstreamSnapshots") == "true"
+
+ // This is the version of the upstream instrumentation BOM
+-val otelVersion = "1.32.1-adot2"
++val otelVersion = "1.32.1-adot-lambda1"
+ val otelSnapshotVersion = "1.33.0"
+ val otelAlphaVersion = if (!TEST_SNAPSHOTS) "$otelVersion-alpha" else "$otelSnapshotVersion-alpha-SNAPSHOT"
+ val otelJavaAgentVersion = if (!TEST_SNAPSHOTS) otelVersion else "$otelSnapshotVersion-SNAPSHOT"
\ No newline at end of file
diff --git a/lambda-layer/patches/opentelemetry-java-instrumentation.patch b/lambda-layer/patches/opentelemetry-java-instrumentation.patch
new file mode 100644
index 0000000000..4ccb33e9a2
--- /dev/null
+++ b/lambda-layer/patches/opentelemetry-java-instrumentation.patch
@@ -0,0 +1,645 @@
+diff --git a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/ApiGatewayProxyRequest.java b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/ApiGatewayProxyRequest.java
+index a96fa5e3f9..df5bcec438 100644
+--- a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/ApiGatewayProxyRequest.java
++++ b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/ApiGatewayProxyRequest.java
+@@ -30,7 +30,14 @@ public abstract class ApiGatewayProxyRequest {
+   private static boolean noHttpPropagationNeeded() {
+     Collection<String> fields =
+         GlobalOpenTelemetry.getPropagators().getTextMapPropagator().fields();
+-    return fields.isEmpty();
++    return fields.isEmpty() || xrayPropagationFieldsOnly(fields);
++  }
++
++  private static boolean xrayPropagationFieldsOnly(Collection<String> fields) {
++    // ugly but faster than typical convert-to-set-and-check-contains-only
++    return (fields.size() == 1)
++        && ParentContextExtractor.AWS_TRACE_HEADER_PROPAGATOR_KEY.equalsIgnoreCase(
++            fields.iterator().next());
+   }
+
+   public static ApiGatewayProxyRequest forStream(InputStream source) {
+diff --git a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsLambdaFunctionInstrumenter.java b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsLambdaFunctionInstrumenter.java
+index 4136e7bed9..dbbcb1c99d 100644
+--- a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsLambdaFunctionInstrumenter.java
++++ b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsLambdaFunctionInstrumenter.java
+@@ -11,7 +11,6 @@ import io.opentelemetry.context.propagation.TextMapGetter;
+ import io.opentelemetry.instrumentation.api.instrumenter.Instrumenter;
+ import io.opentelemetry.instrumentation.api.internal.ContextPropagationDebug;
+ import io.opentelemetry.instrumentation.awslambdacore.v1_0.AwsLambdaRequest;
+-import java.util.Locale;
+ import java.util.Map;
+ import javax.annotation.Nullable;
+
+@@ -47,25 +46,15 @@ public class AwsLambdaFunctionInstrumenter {
+   }
+
+   public Context extract(AwsLambdaRequest input) {
++    return ParentContextExtractor.extract(input.getHeaders(), this);
++  }
++
++  public Context extract(Map<String, String> headers, TextMapGetter<Map<String, String>> getter) {
+     ContextPropagationDebug.debugContextLeakIfEnabled();
+
+     return openTelemetry
+         .getPropagators()
+         .getTextMapPropagator()
+-        .extract(Context.root(), input.getHeaders(), MapGetter.INSTANCE);
+-  }
+-
+-  private enum MapGetter implements TextMapGetter<Map<String, String>> {
+-    INSTANCE;
+-
+-    @Override
+-    public Iterable<String> keys(Map<String, String> map) {
+-      return map.keySet();
+-    }
+-
+-    @Override
+-    public String get(Map<String, String> map, String s) {
+-      return map.get(s.toLowerCase(Locale.ROOT));
+-    }
++        .extract(Context.root(), headers, getter);
+   }
+ }
+diff --git a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsLambdaFunctionInstrumenterFactory.java b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsLambdaFunctionInstrumenterFactory.java
+index aeb828b8e7..277c358ca8 100644
+--- a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsLambdaFunctionInstrumenterFactory.java
++++ b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsLambdaFunctionInstrumenterFactory.java
+@@ -23,7 +23,6 @@ public final class AwsLambdaFunctionInstrumenterFactory {
+                 openTelemetry,
+                 "io.opentelemetry.aws-lambda-core-1.0",
+                 AwsLambdaFunctionInstrumenterFactory::spanName)
+-            .addSpanLinksExtractor(new AwsXrayEnvSpanLinksExtractor())
+             .addAttributesExtractor(new AwsLambdaFunctionAttributesExtractor())
+             .buildInstrumenter(SpanKindExtractor.alwaysServer()));
+   }
+diff --git a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsXrayEnvSpanLinksExtractor.java b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsXrayEnvSpanLinksExtractor.java
+deleted file mode 100644
+index c88cf20c91..0000000000
+--- a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsXrayEnvSpanLinksExtractor.java
++++ /dev/null
+@@ -1,84 +0,0 @@
+-/*
+- * Copyright The OpenTelemetry Authors
+- * SPDX-License-Identifier: Apache-2.0
+- */
+-
+-package io.opentelemetry.instrumentation.awslambdacore.v1_0.internal;
+-
+-import io.opentelemetry.api.common.AttributeKey;
+-import io.opentelemetry.api.common.Attributes;
+-import io.opentelemetry.api.trace.Span;
+-import io.opentelemetry.api.trace.SpanContext;
+-import io.opentelemetry.context.Context;
+-import io.opentelemetry.context.propagation.TextMapGetter;
+-import io.opentelemetry.contrib.awsxray.propagator.AwsXrayPropagator;
+-import io.opentelemetry.instrumentation.api.instrumenter.SpanLinksBuilder;
+-import io.opentelemetry.instrumentation.api.instrumenter.SpanLinksExtractor;
+-import io.opentelemetry.instrumentation.awslambdacore.v1_0.AwsLambdaRequest;
+-import java.util.Collections;
+-import java.util.Locale;
+-import java.util.Map;
+-
+-/**
+- * This class is internal and is hence not for public use. Its APIs are unstable and can change at
+- * any time.
+- */
+-final class AwsXrayEnvSpanLinksExtractor implements SpanLinksExtractor<AwsLambdaRequest> {
+-
+-  private static final String AWS_TRACE_HEADER_ENV_KEY = "_X_AMZN_TRACE_ID";
+-  private static final String AWS_TRACE_HEADER_PROP = "com.amazonaws.xray.traceHeader";
+-  // lower-case map getter used for extraction
+-  private static final String AWS_TRACE_HEADER_PROPAGATOR_KEY = "x-amzn-trace-id";
+-
+-  private static final Attributes LINK_ATTRIBUTES =
+-      Attributes.of(AttributeKey.stringKey("source"), "x-ray-env");
+-
+-  @Override
+-  public void extract(
+-      SpanLinksBuilder spanLinks,
+-      io.opentelemetry.context.Context parentContext,
+-      AwsLambdaRequest awsLambdaRequest) {
+-    extract(spanLinks);
+-  }
+-
+-  public static void extract(SpanLinksBuilder spanLinks) {
+-    Map<String, String> contextMap = getTraceHeaderMap();
+-    if (contextMap.isEmpty()) {
+-      return;
+-    }
+-    Context xrayContext =
+-        AwsXrayPropagator.getInstance().extract(Context.root(), contextMap, MapGetter.INSTANCE);
+-    SpanContext envVarSpanCtx = Span.fromContext(xrayContext).getSpanContext();
+-    if (envVarSpanCtx.isValid()) {
+-      spanLinks.addLink(envVarSpanCtx, LINK_ATTRIBUTES);
+-    }
+-  }
+-
+-  private static Map<String, String> getTraceHeaderMap() {
+-    String traceHeader = System.getProperty(AWS_TRACE_HEADER_PROP);
+-    if (isEmptyOrNull(traceHeader)) {
+-      traceHeader = System.getenv(AWS_TRACE_HEADER_ENV_KEY);
+-    }
+-    return isEmptyOrNull(traceHeader)
+-        ? Collections.emptyMap()
+-        : Collections.singletonMap(AWS_TRACE_HEADER_PROPAGATOR_KEY, traceHeader);
+-  }
+-
+-  private static boolean isEmptyOrNull(String value) {
+-    return value == null || value.isEmpty();
+-  }
+-
+-  private enum MapGetter implements TextMapGetter<Map<String, String>> {
+-    INSTANCE;
+-
+-    @Override
+-    public Iterable<String> keys(Map<String, String> map) {
+-      return map.keySet();
+-    }
+-
+-    @Override
+-    public String get(Map<String, String> map, String s) {
+-      return map.get(s.toLowerCase(Locale.ROOT));
+-    }
+-  }
+-}
+diff --git a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/ParentContextExtractor.java b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/ParentContextExtractor.java
+new file mode 100644
+index 0000000000..72d4f9253b
+--- /dev/null
++++ b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/ParentContextExtractor.java
+@@ -0,0 +1,91 @@
++/*
++ * Copyright The OpenTelemetry Authors
++ * SPDX-License-Identifier: Apache-2.0
++ */
++
++package io.opentelemetry.instrumentation.awslambdacore.v1_0.internal;
++
++import static io.opentelemetry.instrumentation.awslambdacore.v1_0.internal.MapUtils.lowercaseMap;
++
++import io.opentelemetry.api.trace.Span;
++import io.opentelemetry.api.trace.SpanContext;
++import io.opentelemetry.context.Context;
++import io.opentelemetry.context.propagation.TextMapGetter;
++import io.opentelemetry.contrib.awsxray.propagator.AwsXrayPropagator;
++import java.util.Collections;
++import java.util.Locale;
++import java.util.Map;
++
++/**
++ * This class is internal and is hence not for public use. Its APIs are unstable and can change at
++ * any time.
++ */
++public final class ParentContextExtractor {
++
++  private static final String AWS_TRACE_HEADER_ENV_KEY = "_X_AMZN_TRACE_ID";
++  private static final String AWS_TRACE_HEADER_PROP = "com.amazonaws.xray.traceHeader";
++
++  static Context extract(Map<String, String> headers, AwsLambdaFunctionInstrumenter instrumenter) {
++    Context parentContext = null;
++    String parentTraceHeader = getTraceHeader();
++    if (parentTraceHeader != null) {
++      parentContext = fromXrayHeader(parentTraceHeader);
++    }
++    if (!isValidAndSampled(parentContext)) {
++      // try http
++      parentContext = fromHttpHeaders(headers, instrumenter);
++    }
++    return parentContext;
++  }
++
++  private static String getTraceHeader() {
++    // Lambda propagates trace header by system property instead of environment variable from java17
++    String traceHeader = System.getProperty(AWS_TRACE_HEADER_PROP);
++    if (traceHeader == null || traceHeader.isEmpty()) {
++      return System.getenv(AWS_TRACE_HEADER_ENV_KEY);
++    }
++    return traceHeader;
++  }
++
++  private static boolean isValidAndSampled(Context context) {
++    if (context == null) {
++      return false;
++    }
++    Span parentSpan = Span.fromContext(context);
++    SpanContext parentSpanContext = parentSpan.getSpanContext();
++    return (parentSpanContext.isValid() && parentSpanContext.isSampled());
++  }
++
++  private static Context fromHttpHeaders(
++      Map<String, String> headers, AwsLambdaFunctionInstrumenter instrumenter) {
++    return instrumenter.extract(lowercaseMap(headers), MapGetter.INSTANCE);
++  }
++
++  // lower-case map getter used for extraction
++  static final String AWS_TRACE_HEADER_PROPAGATOR_KEY = "x-amzn-trace-id";
++
++  public static Context fromXrayHeader(String parentHeader) {
++    return AwsXrayPropagator.getInstance()
++        .extract(
++            // see BaseTracer#extract() on why we're using root() here
++            Context.root(),
++            Collections.singletonMap(AWS_TRACE_HEADER_PROPAGATOR_KEY, parentHeader),
++            MapGetter.INSTANCE);
++  }
++
++  private enum MapGetter implements TextMapGetter<Map<String, String>> {
++    INSTANCE;
++
++    @Override
++    public Iterable<String> keys(Map<String, String> map) {
++      return map.keySet();
++    }
++
++    @Override
++    public String get(Map<String, String> map, String s) {
++      return map.get(s.toLowerCase(Locale.ROOT));
++    }
++  }
++
++  private ParentContextExtractor() {}
++}
+diff --git a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/test/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsXrayEnvSpanLinksExtractorTest.java b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/test/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsXrayEnvSpanLinksExtractorTest.java
+deleted file mode 100644
+index 509bfbd05e..0000000000
+--- a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/test/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/AwsXrayEnvSpanLinksExtractorTest.java
++++ /dev/null
+@@ -1,128 +0,0 @@
+-/*
+- * Copyright The OpenTelemetry Authors
+- * SPDX-License-Identifier: Apache-2.0
+- */
+-
+-package io.opentelemetry.instrumentation.awslambdacore.v1_0.internal;
+-
+-import static org.assertj.core.api.Assertions.assertThat;
+-import static org.mockito.ArgumentMatchers.eq;
+-import static org.mockito.Mockito.mock;
+-import static org.mockito.Mockito.verify;
+-import static org.mockito.Mockito.verifyNoInteractions;
+-
+-import io.opentelemetry.api.common.AttributeKey;
+-import io.opentelemetry.api.common.Attributes;
+-import io.opentelemetry.api.trace.SpanContext;
+-import io.opentelemetry.instrumentation.api.instrumenter.SpanLinksBuilder;
+-import org.junit.jupiter.api.Test;
+-import org.junit.jupiter.api.extension.ExtendWith;
+-import org.mockito.ArgumentCaptor;
+-import uk.org.webcompere.systemstubs.environment.EnvironmentVariables;
+-import uk.org.webcompere.systemstubs.jupiter.SystemStub;
+-import uk.org.webcompere.systemstubs.jupiter.SystemStubsExtension;
+-import uk.org.webcompere.systemstubs.properties.SystemProperties;
+-
+-/**
+- * This class is internal and is hence not for public use. Its APIs are unstable and can change at
+- * any time.
+- */
+-@ExtendWith(SystemStubsExtension.class)
+-class AwsXrayEnvSpanLinksExtractorTest {
+-  private static final Attributes EXPECTED_LINK_ATTRIBUTES =
+-      Attributes.of(AttributeKey.stringKey("source"), "x-ray-env");
+-
+-  @SystemStub final EnvironmentVariables environmentVariables = new EnvironmentVariables();
+-  @SystemStub final SystemProperties systemProperties = new SystemProperties();
+-
+-  @Test
+-  void shouldIgnoreIfEnvVarAndSystemPropertyEmpty() {
+-    // given
+-    SpanLinksBuilder spanLinksBuilder = mock(SpanLinksBuilder.class);
+-    environmentVariables.set("_X_AMZN_TRACE_ID", "");
+-    systemProperties.set("com.amazonaws.xray.traceHeader", "");
+-    // when
+-    AwsXrayEnvSpanLinksExtractor.extract(spanLinksBuilder);
+-    // then
+-    verifyNoInteractions(spanLinksBuilder);
+-  }
+-
+-  @Test
+-  void shouldLinkAwsParentHeaderAndChooseSystemPropertyIfValidAndNotSampled() {
+-    // given
+-    SpanLinksBuilder spanLinksBuilder = mock(SpanLinksBuilder.class);
+-    environmentVariables.set(
+-        "_X_AMZN_TRACE_ID",
+-        "Root=1-8a3c60f7-d188f8fa79d48a391a778fa6;Parent=0000000000000456;Sampled=0");
+-    systemProperties.set(
+-        "com.amazonaws.xray.traceHeader",
+-        "Root=1-8a3c60f7-d188f8fa79d48a391a778fa7;Parent=0000000000000789;Sampled=0");
+-    // when
+-    AwsXrayEnvSpanLinksExtractor.extract(spanLinksBuilder);
+-    // then
+-    ArgumentCaptor<SpanContext> captor = ArgumentCaptor.forClass(SpanContext.class);
+-    verify(spanLinksBuilder).addLink(captor.capture(), eq(EXPECTED_LINK_ATTRIBUTES));
+-    SpanContext spanContext = captor.getValue();
+-    assertThat(spanContext.isValid()).isTrue();
+-    assertThat(spanContext.isSampled()).isFalse();
+-    assertThat(spanContext.getSpanId()).isEqualTo("0000000000000789");
+-    assertThat(spanContext.getTraceId()).isEqualTo("8a3c60f7d188f8fa79d48a391a778fa7");
+-  }
+-
+-  @Test
+-  void shouldLinkAwsParentHeaderIfValidAndNotSampled() {
+-    // given
+-    SpanLinksBuilder spanLinksBuilder = mock(SpanLinksBuilder.class);
+-    environmentVariables.set(
+-        "_X_AMZN_TRACE_ID",
+-        "Root=1-8a3c60f7-d188f8fa79d48a391a778fa6;Parent=0000000000000456;Sampled=0");
+-    // when
+-    AwsXrayEnvSpanLinksExtractor.extract(spanLinksBuilder);
+-    // then
+-    ArgumentCaptor<SpanContext> captor = ArgumentCaptor.forClass(SpanContext.class);
+-    verify(spanLinksBuilder).addLink(captor.capture(), eq(EXPECTED_LINK_ATTRIBUTES));
+-    SpanContext spanContext = captor.getValue();
+-    assertThat(spanContext.isValid()).isTrue();
+-    assertThat(spanContext.isSampled()).isFalse();
+-    assertThat(spanContext.getSpanId()).isEqualTo("0000000000000456");
+-    assertThat(spanContext.getTraceId()).isEqualTo("8a3c60f7d188f8fa79d48a391a778fa6");
+-  }
+-
+-  @Test
+-  void shouldLinkAwsParentHeaderIfValidAndNotSampledSystemProperty() {
+-    // given
+-    SpanLinksBuilder spanLinksBuilder = mock(SpanLinksBuilder.class);
+-    systemProperties.set(
+-        "com.amazonaws.xray.traceHeader",
+-        "Root=1-8a3c60f7-d188f8fa79d48a391a778fa6;Parent=0000000000000456;Sampled=0");
+-    // when
+-    AwsXrayEnvSpanLinksExtractor.extract(spanLinksBuilder);
+-    // then
+-    ArgumentCaptor<SpanContext> captor = ArgumentCaptor.forClass(SpanContext.class);
+-    verify(spanLinksBuilder).addLink(captor.capture(), eq(EXPECTED_LINK_ATTRIBUTES));
+-    SpanContext spanContext = captor.getValue();
+-    assertThat(spanContext.isValid()).isTrue();
+-    assertThat(spanContext.isSampled()).isFalse();
+-    assertThat(spanContext.getSpanId()).isEqualTo("0000000000000456");
+-    assertThat(spanContext.getTraceId()).isEqualTo("8a3c60f7d188f8fa79d48a391a778fa6");
+-  }
+-
+-  @Test
+-  void shouldLinkAwsParentHeaderIfValidAndSampledSystemProperty() {
+-    // given
+-    SpanLinksBuilder spanLinksBuilder = mock(SpanLinksBuilder.class);
+-    systemProperties.set(
+-        "com.amazonaws.xray.traceHeader",
+-        "Root=1-8a3c60f7-d188f8fa79d48a391a778fa6;Parent=0000000000000456;Sampled=1");
+-    // when
+-    AwsXrayEnvSpanLinksExtractor.extract(spanLinksBuilder);
+-    // then
+-    ArgumentCaptor<SpanContext> captor = ArgumentCaptor.forClass(SpanContext.class);
+-    verify(spanLinksBuilder).addLink(captor.capture(), eq(EXPECTED_LINK_ATTRIBUTES));
+-    SpanContext spanContext = captor.getValue();
+-    assertThat(spanContext.isValid()).isTrue();
+-    assertThat(spanContext.isSampled()).isTrue();
+-    assertThat(spanContext.getSpanId()).isEqualTo("0000000000000456");
+-    assertThat(spanContext.getTraceId()).isEqualTo("8a3c60f7d188f8fa79d48a391a778fa6");
+-  }
+-}
+diff --git a/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/test/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/ParentContextExtractorTest.java b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/test/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/ParentContextExtractorTest.java
+new file mode 100644
+index 0000000000..1fa0b6e536
+--- /dev/null
++++ b/instrumentation/aws-lambda/aws-lambda-core-1.0/library/src/test/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/internal/ParentContextExtractorTest.java
+@@ -0,0 +1,135 @@
++/*
++ * Copyright The OpenTelemetry Authors
++ * SPDX-License-Identifier: Apache-2.0
++ */
++
++package io.opentelemetry.instrumentation.awslambdacore.v1_0.internal;
++
++import static org.assertj.core.api.Assertions.assertThat;
++
++import com.google.common.collect.ImmutableMap;
++import io.opentelemetry.api.OpenTelemetry;
++import io.opentelemetry.api.trace.Span;
++import io.opentelemetry.api.trace.SpanContext;
++import io.opentelemetry.context.Context;
++import io.opentelemetry.context.propagation.ContextPropagators;
++import io.opentelemetry.extension.trace.propagation.B3Propagator;
++import java.util.Map;
++import org.junit.jupiter.api.Test;
++import org.junit.jupiter.api.extension.ExtendWith;
++import uk.org.webcompere.systemstubs.environment.EnvironmentVariables;
++import uk.org.webcompere.systemstubs.jupiter.SystemStub;
++import uk.org.webcompere.systemstubs.jupiter.SystemStubsExtension;
++import uk.org.webcompere.systemstubs.properties.SystemProperties;
++
++/**
++ * This class is internal and is hence not for public use. Its APIs are unstable and can change at
++ * any time.
++ */
++@ExtendWith(SystemStubsExtension.class)
++class ParentContextExtractorTest {
++
++  @SystemStub final EnvironmentVariables environmentVariables = new EnvironmentVariables();
++
++  private static final OpenTelemetry OTEL =
++      OpenTelemetry.propagating(ContextPropagators.create(B3Propagator.injectingSingleHeader()));
++
++  private static final AwsLambdaFunctionInstrumenter INSTRUMENTER =
++      AwsLambdaFunctionInstrumenterFactory.createInstrumenter(OTEL);
++
++  @Test
++  void shouldUseHttpIfAwsParentNotSampled() {
++    // given
++    Map<String, String> headers =
++        ImmutableMap.of(
++            "X-b3-traceId",
++            "4fd0b6131f19f39af59518d127b0cafe",
++            "x-b3-spanid",
++            "0000000000000123",
++            "X-B3-Sampled",
++            "true");
++    environmentVariables.set(
++        "_X_AMZN_TRACE_ID",
++        "Root=1-8a3c60f7-d188f8fa79d48a391a778fa6;Parent=0000000000000456;Sampled=0");
++
++    // when
++    Context context = ParentContextExtractor.extract(headers, INSTRUMENTER);
++    // then
++    Span span = Span.fromContext(context);
++    SpanContext spanContext = span.getSpanContext();
++    assertThat(spanContext.isValid()).isTrue();
++    assertThat(spanContext.isValid()).isTrue();
++    assertThat(spanContext.getSpanId()).isEqualTo("0000000000000123");
++    assertThat(spanContext.getTraceId()).isEqualTo("4fd0b6131f19f39af59518d127b0cafe");
++  }
++
++  @Test
++  void shouldPreferAwsParentHeaderIfValidAndSampled() {
++    // given
++    Map<String, String> headers =
++        ImmutableMap.of(
++            "X-b3-traceId",
++            "4fd0b6131f19f39af59518d127b0cafe",
++            "x-b3-spanid",
++            "0000000000000456",
++            "X-B3-Sampled",
++            "true");
++    environmentVariables.set(
++        "_X_AMZN_TRACE_ID",
++        "Root=1-8a3c60f7-d188f8fa79d48a391a778fa6;Parent=0000000000000456;Sampled=1");
++
++    // when
++    Context context = ParentContextExtractor.extract(headers, INSTRUMENTER);
++    // then
++    Span span = Span.fromContext(context);
++    SpanContext spanContext = span.getSpanContext();
++    assertThat(spanContext.isValid()).isTrue();
++    assertThat(spanContext.isValid()).isTrue();
++    assertThat(spanContext.getSpanId()).isEqualTo("0000000000000456");
++    assertThat(spanContext.getTraceId()).isEqualTo("8a3c60f7d188f8fa79d48a391a778fa6");
++  }
++
++  @Test
++  void shouldExtractCaseInsensitiveHeaders() {
++    // given
++    Map<String, String> headers =
++        ImmutableMap.of(
++            "X-b3-traceId",
++            "4fd0b6131f19f39af59518d127b0cafe",
++            "x-b3-spanid",
++            "0000000000000456",
++            "X-B3-Sampled",
++            "true");
++
++    // when
++    Context context = ParentContextExtractor.extract(headers, INSTRUMENTER);
++    // then
++    Span span = Span.fromContext(context);
++    SpanContext spanContext = span.getSpanContext();
++    assertThat(spanContext.isValid()).isTrue();
++    assertThat(spanContext.isValid()).isTrue();
++    assertThat(spanContext.getSpanId()).isEqualTo("0000000000000456");
++    assertThat(spanContext.getTraceId()).isEqualTo("4fd0b6131f19f39af59518d127b0cafe");
++  }
++
++  @Test
++  void shouldPreferSystemPropertyOverEnvVariable() {
++    // given
++    systemProperties.set(
++        "com.amazonaws.xray.traceHeader",
++        "Root=1-8a3c60f7-d188f8fa79d48a391a778fa7;Parent=0000000000000789;Sampled=0");
++    environmentVariables.set(
++        "_X_AMZN_TRACE_ID",
++        "Root=1-8a3c60f7-d188f8fa79d48a391a778fa6;Parent=0000000000000456;Sampled=1");
++
++    // when
++    Context context = ParentContextExtractor.extract(headers, INSTRUMENTER);
++    // then
++    Span span = Span.fromContext(context);
++    SpanContext spanContext = span.getSpanContext();
++    assertThat(spanContext.isValid()).isTrue();
++    assertThat(spanContext.isValid()).isTrue();
++    assertThat(spanContext.getSpanId()).isEqualTo("0000000000000789");
++    assertThat(spanContext.getTraceId()).isEqualTo("d188f8fa79d48a391a778fa7");
++  }
++}
+diff --git a/instrumentation/aws-lambda/aws-lambda-core-1.0/testing/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/AbstractAwsLambdaTest.java b/instrumentation/aws-lambda/aws-lambda-core-1.0/testing/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/AbstractAwsLambdaTest.java
+index e088efa906..544da9b1bb 100644
+--- a/instrumentation/aws-lambda/aws-lambda-core-1.0/testing/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/AbstractAwsLambdaTest.java
++++ b/instrumentation/aws-lambda/aws-lambda-core-1.0/testing/src/main/java/io/opentelemetry/instrumentation/awslambdacore/v1_0/AbstractAwsLambdaTest.java
+@@ -12,8 +12,6 @@ import static org.mockito.Mockito.when;
+
+ import com.amazonaws.services.lambda.runtime.Context;
+ import com.amazonaws.services.lambda.runtime.RequestHandler;
+-import io.opentelemetry.api.common.AttributeKey;
+-import io.opentelemetry.api.common.Attributes;
+ import io.opentelemetry.api.trace.SpanKind;
+ import io.opentelemetry.instrumentation.testing.junit.InstrumentationExtension;
+ import io.opentelemetry.sdk.trace.data.StatusData;
+@@ -102,22 +100,8 @@ public abstract class AbstractAwsLambdaTest {
+                     span ->
+                         span.hasName("my_function")
+                             .hasKind(SpanKind.SERVER)
+-                            .hasLinksSatisfying(
+-                                links ->
+-                                    assertThat(links)
+-                                        .singleElement()
+-                                        .satisfies(
+-                                            link -> {
+-                                              assertThat(link.getSpanContext().getTraceId())
+-                                                  .isEqualTo("8a3c60f7d188f8fa79d48a391a778fa6");
+-                                              assertThat(link.getSpanContext().getSpanId())
+-                                                  .isEqualTo("0000000000000456");
+-                                              assertThat(link.getAttributes())
+-                                                  .isEqualTo(
+-                                                      Attributes.of(
+-                                                          AttributeKey.stringKey("source"),
+-                                                          "x-ray-env"));
+-                                            }))
++                            .hasTraceId("8a3c60f7d188f8fa79d48a391a778fa6")
++                            .hasParentSpanId("0000000000000456")
+                             .hasAttributesSatisfyingExactly(
+                                 equalTo(SemanticAttributes.FAAS_INVOCATION_ID, "1-22-333"))));
+   }
+diff --git a/instrumentation/aws-lambda/aws-lambda-events-2.2/library/src/main/java/io/opentelemetry/instrumentation/awslambdaevents/v2_2/internal/SqsMessageSpanLinksExtractor.java b/instrumentation/aws-lambda/aws-lambda-events-2.2/library/src/main/java/io/opentelemetry/instrumentation/awslambdaevents/v2_2/internal/SqsMessageSpanLinksExtractor.java
+index 305e3e62a0..844ee31899 100644
+--- a/instrumentation/aws-lambda/aws-lambda-events-2.2/library/src/main/java/io/opentelemetry/instrumentation/awslambdaevents/v2_2/internal/SqsMessageSpanLinksExtractor.java
++++ b/instrumentation/aws-lambda/aws-lambda-events-2.2/library/src/main/java/io/opentelemetry/instrumentation/awslambdaevents/v2_2/internal/SqsMessageSpanLinksExtractor.java
+@@ -9,48 +9,22 @@ import com.amazonaws.services.lambda.runtime.events.SQSEvent.SQSMessage;
+ import io.opentelemetry.api.trace.Span;
+ import io.opentelemetry.api.trace.SpanContext;
+ import io.opentelemetry.context.Context;
+-import io.opentelemetry.context.propagation.TextMapGetter;
+-import io.opentelemetry.contrib.awsxray.propagator.AwsXrayPropagator;
+ import io.opentelemetry.instrumentation.api.instrumenter.SpanLinksBuilder;
+ import io.opentelemetry.instrumentation.api.instrumenter.SpanLinksExtractor;
+-import java.util.Collections;
+-import java.util.Locale;
+-import java.util.Map;
++import io.opentelemetry.instrumentation.awslambdacore.v1_0.internal.ParentContextExtractor;
+
+ class SqsMessageSpanLinksExtractor implements SpanLinksExtractor<SQSMessage> {
+   private static final String AWS_TRACE_HEADER_SQS_ATTRIBUTE_KEY = "AWSTraceHeader";
+
+-  // lower-case map getter used for extraction
+-  static final String AWS_TRACE_HEADER_PROPAGATOR_KEY = "x-amzn-trace-id";
+-
+   @Override
+   public void extract(SpanLinksBuilder spanLinks, Context parentContext, SQSMessage message) {
+     String parentHeader = message.getAttributes().get(AWS_TRACE_HEADER_SQS_ATTRIBUTE_KEY);
+     if (parentHeader != null) {
+-      Context xrayContext =
+-          AwsXrayPropagator.getInstance()
+-              .extract(
+-                  Context.root(), // We don't want the ambient context.
+-                  Collections.singletonMap(AWS_TRACE_HEADER_PROPAGATOR_KEY, parentHeader),
+-                  MapGetter.INSTANCE);
+-      SpanContext messageSpanCtx = Span.fromContext(xrayContext).getSpanContext();
+-      if (messageSpanCtx.isValid()) {
+-        spanLinks.addLink(messageSpanCtx);
++      SpanContext parentCtx =
++          Span.fromContext(ParentContextExtractor.fromXrayHeader(parentHeader)).getSpanContext();
++      if (parentCtx.isValid()) {
++        spanLinks.addLink(parentCtx);
+       }
+     }
+   }
+-
+-  private enum MapGetter implements TextMapGetter<Map<String, String>> {
+-    INSTANCE;
+-
+-    @Override
+-    public Iterable<String> keys(Map<String, String> map) {
+-      return map.keySet();
+-    }
+-
+-    @Override
+-    public String get(Map<String, String> map, String s) {
+-      return map.get(s.toLowerCase(Locale.ROOT));
+-    }
+-  }
+ }
+diff --git a/version.gradle.kts b/version.gradle.kts
+index cc1414c0bf..db8a59b046 100644
+--- a/version.gradle.kts
++++ b/version.gradle.kts
+@@ -1,5 +1,5 @@
+-val stableVersion = "1.32.1"
+-val alphaVersion = "1.32.1-alpha"
++val stableVersion = "1.32.1-adot-lambda1"
++val alphaVersion = "1.32.1-adot-lambda1-alpha"
+
+ allprojects {
+   if (findProperty("otel.stable") != "true") {
\ No newline at end of file
diff --git a/lambda-layer/settings.gradle.kts b/lambda-layer/settings.gradle.kts
new file mode 100644
index 0000000000..b37d925e37
--- /dev/null
+++ b/lambda-layer/settings.gradle.kts
@@ -0,0 +1,16 @@
+pluginManagement {
+  plugins {
+    id("com.diffplug.spotless") version "6.13.0"
+    id("com.github.ben-manes.versions") version "0.50.0"
+    id("com.github.johnrengelman.shadow") version "8.1.1"
+  }
+}
+
+dependencyResolutionManagement {
+  repositories {
+    mavenCentral()
+    mavenLocal()
+  }
+}
+
+rootProject.name = "aws-otel-lambda-java"