diff --git a/config/manager/manager.yaml b/config/manager/manager.yaml
index dd91e797..ba2954c5 100644
--- a/config/manager/manager.yaml
+++ b/config/manager/manager.yaml
@@ -59,7 +59,7 @@ spec:
         env:
         - name: GATEWAY_IMAGE
           # renovate: datasource=docker depName=cloudflare/cloudflared
-          value: "cloudflare/cloudflared:2024.11.1"
+          value: "cloudflare/cloudflared:2024.12.1"
         securityContext:
           allowPrivilegeEscalation: false
           capabilities:
diff --git a/internal/controller/gateway_controller_test.go b/internal/controller/gateway_controller_test.go
index 02fdf89c..df5fd3d9 100644
--- a/internal/controller/gateway_controller_test.go
+++ b/internal/controller/gateway_controller_test.go
@@ -44,7 +44,7 @@ var _ = Describe("Gateway controller", func() {
 
 			By("Setting the Image ENV VAR which stores the Operand image")
 			// renovate: datasource=docker depName=cloudflare/cloudflared
-			err = os.Setenv("GATEWAY_IMAGE", "cloudflare/cloudflared:2024.11.1")
+			err = os.Setenv("GATEWAY_IMAGE", "cloudflare/cloudflared:2024.12.1")
 			Expect(err).To(Not(HaveOccurred()))
 
 			By("creating the custom resource for the Kind Gateway")