diff --git a/src/Service.Tests/Configuration/Telemetry/OpenTelemetryTests.cs b/src/Service.Tests/Configuration/Telemetry/OpenTelemetryTests.cs
index df213c6f48..e1602517a0 100644
--- a/src/Service.Tests/Configuration/Telemetry/OpenTelemetryTests.cs
+++ b/src/Service.Tests/Configuration/Telemetry/OpenTelemetryTests.cs
@@ -2,7 +2,10 @@
 // Licensed under the MIT License.
 
 using System;
+using System.Diagnostics;
 using System.IO;
+using System.Net.Http;
+using System.Threading.Tasks;
 using Azure.DataApiBuilder.Config.ObjectModel;
 using Microsoft.AspNetCore.TestHost;
 using Microsoft.Extensions.DependencyInjection;
@@ -24,6 +27,7 @@ public class OpenTelemetryTests
 
     private const string CONFIG_WITH_TELEMETRY = "dab-open-telemetry-test-config.json";
     private const string CONFIG_WITHOUT_TELEMETRY = "dab-no-open-telemetry-test-config.json";
+    private const string ASPNETCORE_ACTIVITY_SOURCE_NAME = "Microsoft.AspNetCore";
     private static RuntimeConfig _configuration;
 
     /// <summary>
@@ -88,6 +92,61 @@ public void TestOpenTelemetryServicesEnabled()
         Assert.IsNotNull(meterProvider, "MeterProvider should be registered.");
     }
 
+    /// <summary>
+    /// Tests that an inbound HTTP request produces a recorded server span when Open Telemetry is enabled,
+    /// and that this span continues the trace context received in the W3C traceparent header.
+    /// The listener below never samples by itself, so the span can only be recorded because
+    /// the OpenTelemetry TracerProvider subscribes to the ASP.NET Core activity source.
+    /// </summary>
+    [TestMethod]
+    public async Task TestOpenTelemetryRecordsInboundHttpRequestSpan()
+    {
+        // Arrange
+        SetUpTelemetryInConfig(CONFIG_WITH_TELEMETRY, true, "http://localhost:4317", "key=key", OtlpExportProtocol.Grpc);
+
+        ActivityTraceId incomingTraceId = ActivityTraceId.CreateRandom();
+        ActivitySpanId incomingParentSpanId = ActivitySpanId.CreateRandom();
+        TaskCompletionSource<Activity> recordedServerActivity = new(TaskCreationOptions.RunContinuationsAsynchronously);
+        using ActivityListener listener = new()
+        {
+            ShouldListenTo = source => source.Name == ASPNETCORE_ACTIVITY_SOURCE_NAME,
+            Sample = (ref ActivityCreationOptions<ActivityContext> _) => ActivitySamplingResult.None,
+            ActivityStopped = activity =>
+            {
+                if (activity.TraceId == incomingTraceId)
+                {
+                    recordedServerActivity.TrySetResult(activity);
+                }
+            }
+        };
+        ActivitySource.AddActivityListener(listener);
+
+        string[] args = new[]
+        {
+            $"--ConfigFileName={CONFIG_WITH_TELEMETRY}"
+        };
+        using TestServer server = new(Program.CreateWebHostBuilder(args));
+        Assert.IsNotNull(server.Services.GetService<TracerProvider>(), "TracerProvider should be registered.");
+        using HttpClient client = server.CreateClient();
+
+        using HttpRequestMessage request = new(HttpMethod.Get, "/");
+        request.Headers.Add("traceparent", $"00-{incomingTraceId.ToHexString()}-{incomingParentSpanId.ToHexString()}-01");
+
+        // Act
+        using HttpResponseMessage response = await client.SendAsync(request);
+
+        // Assert
+        // The server activity is stopped once the request pipeline completes, which can happen after the response is returned.
+        Task completedTask = await Task.WhenAny(recordedServerActivity.Task, Task.Delay(TimeSpan.FromSeconds(10)));
+        Assert.AreSame(recordedServerActivity.Task, completedTask, "An inbound HTTP request should produce a server span.");
+
+        Activity serverActivity = await recordedServerActivity.Task;
+        Assert.IsTrue(serverActivity.Recorded, "The server span should be recorded.");
+        Assert.AreEqual(ActivityKind.Server, serverActivity.Kind, "The span should be a server span.");
+        Assert.AreEqual(incomingTraceId, serverActivity.TraceId, "The server span should continue the incoming trace.");
+        Assert.AreEqual(incomingParentSpanId, serverActivity.ParentSpanId, "The server span should be parented to the incoming span.");
+    }
+
     /// <summary>
     /// Tests if the services are correctly disabled for Open Telemetry.
     /// </summary>
diff --git a/src/Service/Startup.cs b/src/Service/Startup.cs
index 5b6ffbb7d7..3ceb194212 100644
--- a/src/Service/Startup.cs
+++ b/src/Service/Startup.cs
@@ -193,6 +193,9 @@ public void ConfigureServices(IServiceCollection services)
                 .WithTracing(tracing =>
                 {
                     tracing.SetResourceBuilder(ResourceBuilder.CreateDefault().AddService(runtimeConfig.Runtime.Telemetry.OpenTelemetry.ServiceName!))
+                    // Creates a server span for every inbound HTTP request (REST, GraphQL, MCP, health)
+                    // and continues the incoming W3C traceparent, so DAB spans are parented correctly.
+                    .AddAspNetCoreInstrumentation()
                     .AddHttpClientInstrumentation()
                     // TODO: should we also add FusionCache traces?
                     // To do so we just need to add the package ZiggyCreatures.FusionCache.OpenTelemetry and call