diff --git a/CHANGELOG.md b/CHANGELOG.md
index 932a09cccc..e85e24b130 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -13,6 +13,7 @@ This changelog will be used to generate documentation on [release notes page](ht
 - [Make BaseSDK use W3C Trace Context based correlation by default. Set TelemetryConfiguration.EnableW3CCorrelation=false to disable this.](https://github.com/microsoft/ApplicationInsights-dotnet/pull/1193)
 - [Removed TelemetryConfiguration.EnableW3CCorrelation. Users should do Activity.DefaultIdFormat = ActivityIdFormat.Hierarchical; Activity.ForceDefaultIdFormat = true; to disable W3C Format](https://github.com/microsoft/ApplicationInsights-dotnet/issues/1198)
 - [Enable sampling based on upstream sampling decision for adaptive sampling](https://github.com/microsoft/ApplicationInsights-dotnet/pull/1200)
+- [Set tracestate if available on requests and dependencies](https://github.com/microsoft/ApplicationInsights-dotnet/pull/1207)
 
 ## Version 2.11.0-beta1
 - [Performance fixes: Support Head Sampling; Remove NewGuid(); Sampling Flags; etc... ](https://github.com/microsoft/ApplicationInsights-dotnet/pull/1158)
diff --git a/Test/Microsoft.ApplicationInsights.Test/Shared/Extensibility/OperationCorrelationTelemetryInitializerTests.cs b/Test/Microsoft.ApplicationInsights.Test/Shared/Extensibility/OperationCorrelationTelemetryInitializerTests.cs
index 33ebbef215..c3ec3e16c1 100644
--- a/Test/Microsoft.ApplicationInsights.Test/Shared/Extensibility/OperationCorrelationTelemetryInitializerTests.cs
+++ b/Test/Microsoft.ApplicationInsights.Test/Shared/Extensibility/OperationCorrelationTelemetryInitializerTests.cs
@@ -86,7 +86,7 @@ public void InitializePopulatesOperationContextFromActivityWhenW3CIsDisabled()
             {
                 Activity parent = new Activity("parent");
 
-                // Setting parentid like this forces Activity to use Hierrachial ID Format
+                // Setting parentid like this forces Activity to use Hierarchical ID Format
                 parent.SetParentId("parent");
                 parent.Start();
 
@@ -347,5 +347,71 @@ public void InitializeWithActivityNotRecordedDoesNotOverrideSampledInIfSet()
             Assert.AreEqual(SamplingDecision.SampledIn, request.ProactiveSamplingDecision);
             currentActivity.Stop();
         }
+
+        [TestMethod]
+        public void InitializeOnActivityWithTracestate()
+        {
+            Activity parent = new Activity("parent")
+            {
+                TraceStateString = "some=state"
+            };
+            parent.Start();
+
+            var telemetry = new DependencyTelemetry();
+            (new OperationCorrelationTelemetryInitializer()).Initialize(telemetry);
+
+            Assert.IsTrue(telemetry.Properties.ContainsKey("tracestate"));
+            Assert.AreEqual("some=state", telemetry.Properties["tracestate"]);
+        }
+
+        [TestMethod]
+        public void InitializeOnActivityWithTracestateW3COff()
+        {
+            ActivityFormatHelper.DisableW3CFormatInActivity();
+
+            Activity parent = new Activity("parent")
+            {
+                TraceStateString = "some=state"
+            };
+            parent.Start();
+
+            var telemetry = new DependencyTelemetry();
+            (new OperationCorrelationTelemetryInitializer()).Initialize(telemetry);
+
+            Assert.IsFalse(telemetry.Properties.ContainsKey("tracestate"));
+        }
+
+        [TestMethod]
+        public void InitializeOnActivityWithTracestateWhenPropertyAlreadyExists()
+        {
+            Activity parent = new Activity("parent")
+            {
+                TraceStateString = "some=state"
+            };
+            parent.Start();
+
+            var telemetry = new DependencyTelemetry();
+            telemetry.Properties.Add("tracestate", "123");
+            (new OperationCorrelationTelemetryInitializer()).Initialize(telemetry);
+
+            Assert.IsTrue(telemetry.Properties.ContainsKey("tracestate"));
+            Assert.AreEqual("123", telemetry.Properties["tracestate"]);
+        }
+
+
+        [TestMethod]
+        public void InitializeOnActivityWithTracestateNotOperationTelemetry()
+        {
+            Activity parent = new Activity("parent")
+            {
+                TraceStateString = "some=state"
+            };
+            parent.Start();
+
+            var telemetry = new TraceTelemetry();
+
+            // does not throw
+            (new OperationCorrelationTelemetryInitializer()).Initialize(telemetry);
+        }
     }
 }
\ No newline at end of file
diff --git a/src/Microsoft.ApplicationInsights/Extensibility/OperationCorrelationTelemetryInitializer.cs b/src/Microsoft.ApplicationInsights/Extensibility/OperationCorrelationTelemetryInitializer.cs
index 6759115e95..89ea56deb5 100644
--- a/src/Microsoft.ApplicationInsights/Extensibility/OperationCorrelationTelemetryInitializer.cs
+++ b/src/Microsoft.ApplicationInsights/Extensibility/OperationCorrelationTelemetryInitializer.cs
@@ -1,6 +1,5 @@
 namespace Microsoft.ApplicationInsights.Extensibility
 {
-    using System;
     using System.Diagnostics;
 
     using Microsoft.ApplicationInsights;
@@ -15,6 +14,8 @@
     /// </summary>
     public class OperationCorrelationTelemetryInitializer : ITelemetryInitializer
     {
+        private const string TracestatePropertyKey = "tracestate";
+
         /// <summary>
         /// Initializes/Adds operation context to the existing telemetry item.
         /// </summary>
@@ -44,6 +45,15 @@ public void Initialize(ITelemetry telemetryItem)
                         {
                             itemOperationContext.ParentId = W3CUtilities.FormatTelemetryId(itemOperationContext.Id, currentActivity.SpanId.ToHexString());
                         }
+
+                        // we are going to set tracestate property on requests and dependencies only
+                        if (!string.IsNullOrEmpty(currentActivity.TraceStateString) &&
+                            telemetryItem is OperationTelemetry &&
+                            telemetryProp != null &&
+                            !telemetryProp.Properties.ContainsKey(TracestatePropertyKey))
+                        {
+                            telemetryProp.Properties.Add(TracestatePropertyKey, currentActivity.TraceStateString);
+                        }
                     }
                     else
                     {