diff --git a/changelog/updates/2024-03-27-open-vm-tools-12.4.0-update.md b/changelog/updates/2024-03-27-open-vm-tools-12.4.0-update.md
new file mode 100644
index 0000000000..86ec2da5af
--- /dev/null
+++ b/changelog/updates/2024-03-27-open-vm-tools-12.4.0-update.md
@@ -0,0 +1 @@
+- open-vm-tools ([12.4.0](https://github.com/vmware/open-vm-tools/releases/tag/stable-12.4.0))
diff --git a/sdk_container/src/third_party/coreos-overlay/app-emulation/open-vm-tools/Manifest b/sdk_container/src/third_party/coreos-overlay/app-emulation/open-vm-tools/Manifest
index 420df13cfc..944f5d6b24 100644
--- a/sdk_container/src/third_party/coreos-overlay/app-emulation/open-vm-tools/Manifest
+++ b/sdk_container/src/third_party/coreos-overlay/app-emulation/open-vm-tools/Manifest
@@ -1 +1 @@
-DIST open-vm-tools-12.3.5-22544099.tar.gz 4364646 BLAKE2B 465165f5d23dbfac1c8aa9f12bdb42563a62ad111fce1b8cc4647f564c7a3d49e13431e5085b315f34b0caeee92b43b785f693f7b1dcf18777d7b2a56cfaffc2 SHA512 7a81d929ea4871b8af0af0fa3dc62a821ac4286235255103f1bcf014e3b04b5bbbfa178a9328a16d67cfd595c4ce726dc9e195adbe21ec5c68a4d1abb1561ff6
+DIST open-vm-tools-12.4.0-23259341.tar.gz 4353211 BLAKE2B a5a801b75c77d0c13752073cceab6c7d5b9710224243742ac4ba82fdaf6fc5ebd3eda76f1d9dca0f2f379563e3a00eb309e3a1af517f35b5713b8fcb340a2e0e SHA512 11ea43c64ec534922145f83e2b7ef9254437f80656ad03b596340a78c3698adcc7d84adade9c5d8e1c83b5ebc3bd086601b1d104e0f070274dc2b6bc1f64fb17
diff --git a/sdk_container/src/third_party/coreos-overlay/app-emulation/open-vm-tools/open-vm-tools-12.3.5.ebuild b/sdk_container/src/third_party/coreos-overlay/app-emulation/open-vm-tools/open-vm-tools-12.4.0.ebuild
similarity index 99%
rename from sdk_container/src/third_party/coreos-overlay/app-emulation/open-vm-tools/open-vm-tools-12.3.5.ebuild
rename to sdk_container/src/third_party/coreos-overlay/app-emulation/open-vm-tools/open-vm-tools-12.4.0.ebuild
index 27c5613f38..b01fde0da5 100644
--- a/sdk_container/src/third_party/coreos-overlay/app-emulation/open-vm-tools/open-vm-tools-12.3.5.ebuild
+++ b/sdk_container/src/third_party/coreos-overlay/app-emulation/open-vm-tools/open-vm-tools-12.4.0.ebuild
@@ -7,7 +7,7 @@ inherit autotools linux-info pam systemd udev
 
 DESCRIPTION="Tools for VMware guests"
 HOMEPAGE="https://github.com/vmware/open-vm-tools"
-MY_P="${P}-22544099"
+MY_P="${P}-23259341"
 SRC_URI="https://github.com/vmware/open-vm-tools/releases/download/stable-${PV}/${MY_P}.tar.gz"
 
 LICENSE="LGPL-2.1"
diff --git a/sdk_container/src/third_party/coreos-overlay/coreos-base/oem-vmware/oem-vmware-12.3.5.ebuild b/sdk_container/src/third_party/coreos-overlay/coreos-base/oem-vmware/oem-vmware-12.4.0.ebuild
similarity index 100%
rename from sdk_container/src/third_party/coreos-overlay/coreos-base/oem-vmware/oem-vmware-12.3.5.ebuild
rename to sdk_container/src/third_party/coreos-overlay/coreos-base/oem-vmware/oem-vmware-12.4.0.ebuild