diff --git a/pkgs/development/python-modules/azure-core/default.nix b/pkgs/development/python-modules/azure-core/default.nix
index 6bcdd65876ef..4f4e81311ed0 100644
--- a/pkgs/development/python-modules/azure-core/default.nix
+++ b/pkgs/development/python-modules/azure-core/default.nix
@@ -8,6 +8,10 @@
   aiohttp,
   flask,
   mock,
+  opentelemetry-api,
+  opentelemetry-instrumentation,
+  opentelemetry-instrumentation-requests,
+  opentelemetry-sdk,
   pytest,
   pytest-asyncio,
   pytest-trio,
@@ -20,7 +24,7 @@
 }:
 
 buildPythonPackage rec {
-  version = "1.32.0";
+  version = "1.35.0";
   pname = "azure-core";
   pyproject = true;
 
@@ -31,12 +35,12 @@ buildPythonPackage rec {
   src = fetchPypi {
     pname = "azure_core";
     inherit version;
-    hash = "sha256-IrPDXWstrhSZD2wb4pEr8j/+ULIg5wiiirG7krHHMOU=";
+    hash = "sha256-wL5ShIlIXp7eWbaXHrY8HqrPg+9TABv+OQTkdelyvlw=";
   };
 
-  nativeBuildInputs = [ setuptools ];
+  build-system = [ setuptools ];
 
-  propagatedBuildInputs = [
+  dependencies = [
     requests
     six
     typing-extensions
@@ -44,12 +48,16 @@ buildPythonPackage rec {
 
   optional-dependencies = {
     aio = [ aiohttp ];
+    tracing = [ opentelemetry-api ];
   };
 
   nativeCheckInputs = [
     aiodns
     flask
     mock
+    opentelemetry-instrumentation
+    opentelemetry-instrumentation-requests
+    opentelemetry-sdk
     pytest
     pytest-trio
     pytest-asyncio
@@ -95,6 +103,10 @@ buildPythonPackage rec {
     "tests/test_polling.py"
     "tests/async_tests/test_base_polling_async.py"
     "tests/async_tests/test_polling_async.py"
+    # infinite recursion with azure-storage-blob
+    "tests/async_tests/test_tracing_live_async.py"
+    "tests/test_serialization.py"
+    "tests/test_tracing_live.py"
   ];
 
   meta = with lib; {