diff --git a/.github/workflows/update-version.yml b/.github/workflows/update-version.yml
new file mode 100644
index 00000000000..f56f67aa42a
--- /dev/null
+++ b/.github/workflows/update-version.yml
@@ -0,0 +1,36 @@
+# This workflow automatically updates VERSION file in repo if any change is pushed to main branch. It performs below steps:
+# 1. Checks out the repo with depth 0 for full history.
+# 2. Runs make command to update VERSION file with the latest tag
+# 3. Commit and push updated VERSION file
+
+name: Update VERSION File
+
+on:
+  push:
+    branches:
+      - main
+
+jobs:
+  update-version-file:
+    runs-on: ubuntu-latest
+
+    steps:
+    - name: Check out code
+      uses: actions/checkout@v4
+      with:
+        fetch-depth: 0
+
+    - name: Update VERSION file
+      run: make update-version
+
+    - name: Commit and push changes
+      run: |
+        if [ -n "$(git status --porcelain VERSION)" ]; then
+          git config user.name "github-actions[bot]"
+          git config user.email "github-actions[bot]@users.noreply.github.com"
+          git add VERSION
+          git commit -m "Update VERSION file to latest tag"
+          git push
+        else
+          echo "No changes to VERSION file."
+        fi
diff --git a/CHANGELOG.md b/CHANGELOG.md
index e2f98cea412..bf8adc454f4 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -1,5 +1,5 @@
 ## main / unreleased
-
+* [ENHANCEMENT] Send semver version in api/stattus/buildinfo for cloud deployments [#4110](https://github.com/grafana/tempo/pull/4110) [@Aki0x137]
 * [ENHANCEMENT] Speedup DistinctValue collector and exit early for ingesters [#4104](https://github.com/grafana/tempo/pull/4104) (@electron0zero)
 * [ENHANCEMENT] Add disk caching in ingester SearchTagValuesV2 for completed blocks [#4069](https://github.com/grafana/tempo/pull/4069) (@electron0zero)
 * [BUGFIX] Replace hedged requests roundtrips total with a counter. [#4063](https://github.com/grafana/tempo/pull/4063) [#4078](https://github.com/grafana/tempo/pull/4078) (@galalen)
diff --git a/Makefile b/Makefile
index 0d409e43ed3..5a98f5d84df 100644
--- a/Makefile
+++ b/Makefile
@@ -5,6 +5,11 @@ help:  ## Display this help
 
 .DEFAULT_GOAL:=help
 
+# Get the latest tag and store it in VERSION file
+update-version:
+	@latest_tag=$$(git describe --tags `git rev-list --tags --max-count=1`); \
+	echo $$latest_tag > VERSION; \
+
 # Version number
 VERSION=$(shell ./tools/image-tag | cut -d, -f 1)
 
diff --git a/VERSION b/VERSION
new file mode 100644
index 00000000000..8a965c11682
--- /dev/null
+++ b/VERSION
@@ -0,0 +1 @@
+v2.6.0
diff --git a/integration/util/util.go b/integration/util/util.go
index d548f59dbdb..cc259d50878 100644
--- a/integration/util/util.go
+++ b/integration/util/util.go
@@ -592,6 +592,11 @@ func CallBuildinfo(t *testing.T, svc *e2e.HTTPService) {
 		_, ok := jsonResponse[key]
 		require.True(t, ok)
 	}
+
+	version, ok := jsonResponse["version"].(string)
+	require.True(t, ok)
+	require.Regexp(t, `^v?(\d+\.)?(\d+\.)?(\d+)$`, version)
+
 	defer res.Body.Close()
 }
 
diff --git a/tools/image-tag b/tools/image-tag
index d4f8ac7021a..2afbdb39601 100755
--- a/tools/image-tag
+++ b/tools/image-tag
@@ -4,6 +4,27 @@ set -o errexit
 set -o nounset
 set -o pipefail
 
+REPO_ROOT=$(git rev-parse --show-toplevel)
+
+is_valid_semver() {
+      local version=$1
+      # regex taken from https://semver.org/
+      if [[ $version =~ ^v(0|[1-9]\d*)\.(0|[1-9]\d*)\.(0|[1-9]\d*)(?:-((?:0|[1-9]\d*|\d*[a-zA-Z-][0-9a-zA-Z-]*)(?:\.(?:0|[1-9]\d*|\d*[a-zA-Z-][0-9a-zA-Z-]*))*))?(?:\+([0-9a-zA-Z-]+(?:\.[0-9a-zA-Z-]+)*))?$ ]] ;then
+            return 1
+      else
+            return 0
+      fi
+}
+
+# Check if there is a VERSION file
+if [ -f "${REPO_ROOT}/VERSION" ]; then
+      VERSION=$(cat "${REPO_ROOT}/VERSION" )
+      if is_valid_semver "$VERSION"; then
+            echo "$VERSION"
+            exit 0
+      fi
+fi
+
 WIP=$(git diff --quiet || echo '-WIP')
 BRANCH=$(git rev-parse --abbrev-ref HEAD | sed 's#/#-#g')
 # When 7 chars are not enough to be unique, git automatically uses more.