diff --git a/charts/datadog/CHANGELOG.md b/charts/datadog/CHANGELOG.md
index 645f41a1d..316bf5346 100644
--- a/charts/datadog/CHANGELOG.md
+++ b/charts/datadog/CHANGELOG.md
@@ -1,5 +1,9 @@
 # Datadog changelog
 
+## 3.54.2
+
+* Set `DD_APM_ENABLED` value in the core agent container to properly report its value.
+
 ## 3.54.1
 
 * Migrate from `kubeval` to `kubeconform` for ci chart validation.
@@ -90,7 +94,7 @@ Get rid of the old GODEBUG=x509ignoreCN=0 hack that is not effective anymore in
 
 ## 3.49.2
 
-* Fix check for APM Instrumentation when apm.intrumentation.disabledNamespaces is set 
+* Fix check for APM Instrumentation when apm.intrumentation.disabledNamespaces is set
 
 ## 3.49.1
 
@@ -147,7 +151,7 @@ Get rid of the old GODEBUG=x509ignoreCN=0 hack that is not effective anymore in
 
 ## 3.42.1
 
-* Bump FIPS proxy OpenSSL version to 3.0.12 
+* Bump FIPS proxy OpenSSL version to 3.0.12
 
 ## 3.42.0
 
diff --git a/charts/datadog/Chart.yaml b/charts/datadog/Chart.yaml
index 8a811cd17..58b79c402 100644
--- a/charts/datadog/Chart.yaml
+++ b/charts/datadog/Chart.yaml
@@ -1,6 +1,6 @@
 apiVersion: v1
 name: datadog
-version: 3.54.1
+version: 3.54.2
 appVersion: "7"
 description: Datadog Agent
 keywords:
diff --git a/charts/datadog/README.md b/charts/datadog/README.md
index d1fae80ee..4a4038898 100644
--- a/charts/datadog/README.md
+++ b/charts/datadog/README.md
@@ -1,6 +1,6 @@
 # Datadog
 
-![Version: 3.54.1](https://img.shields.io/badge/Version-3.54.1-informational?style=flat-square) ![AppVersion: 7](https://img.shields.io/badge/AppVersion-7-informational?style=flat-square)
+![Version: 3.54.2](https://img.shields.io/badge/Version-3.54.2-informational?style=flat-square) ![AppVersion: 7](https://img.shields.io/badge/AppVersion-7-informational?style=flat-square)
 
 [Datadog](https://www.datadoghq.com/) is a hosted infrastructure monitoring platform. This chart adds the Datadog Agent to all nodes in your cluster via a DaemonSet. It also optionally depends on the [kube-state-metrics chart](https://github.com/prometheus-community/helm-charts/tree/main/charts/kube-state-metrics). For more information about monitoring Kubernetes with Datadog, please refer to the [Datadog documentation website](https://docs.datadoghq.com/agent/basic_agent_usage/kubernetes/).
 
diff --git a/charts/datadog/templates/_container-agent.yaml b/charts/datadog/templates/_container-agent.yaml
index cc71feddd..e1d618a63 100644
--- a/charts/datadog/templates/_container-agent.yaml
+++ b/charts/datadog/templates/_container-agent.yaml
@@ -101,7 +101,7 @@
     {{- include "containers-cluster-agent-env" . | nindent 4 }}
     {{- end }}
     - name: DD_APM_ENABLED
-      value: "false"
+      value: {{ include "should-enable-trace-agent" . | quote }}
     - name: DD_LOGS_ENABLED
       value: {{  (default false (or .Values.datadog.logs.enabled .Values.datadog.logsEnabled)) | quote}}
     - name: DD_LOGS_CONFIG_CONTAINER_COLLECT_ALL