diff --git a/.changes/next-release/41474702610-enhancement-Terraform-48991.json b/.changes/next-release/41474702610-enhancement-Terraform-48991.json
new file mode 100644
index 000000000..65d5afa13
--- /dev/null
+++ b/.changes/next-release/41474702610-enhancement-Terraform-48991.json
@@ -0,0 +1,5 @@
+{
+  "type": "enhancement",
+  "category": "Terraform",
+  "description": "Update required terraform veresoin to support 1.3 (#2014)"
+}
diff --git a/chalice/package.py b/chalice/package.py
index bda5afe52..ecdd0268e 100644
--- a/chalice/package.py
+++ b/chalice/package.py
@@ -819,7 +819,7 @@ def generate(self, resources):
             'resource': {},
             'locals': {},
             'terraform': {
-                'required_version': '>= 0.12.26, < 1.2.0',
+                'required_version': '>= 0.12.26, < 1.4.0',
                 'required_providers': {
                     'aws': {'version': '>= 2, < 5'},
                     'null': {'version': '>= 2, < 4'}