diff --git a/comp/core/agenttelemetry/impl/sender.go b/comp/core/agenttelemetry/impl/sender.go
index 585807eb6a539b..ddb83a3b19a893 100644
--- a/comp/core/agenttelemetry/impl/sender.go
+++ b/comp/core/agenttelemetry/impl/sender.go
@@ -57,7 +57,9 @@ type senderImpl struct {
 	cfgComp config.Reader
 	logComp log.Component
 
-	client client
+	compress         bool
+	compressionLevel int
+	client           client
 
 	endpoints *logconfig.Endpoints
 
@@ -207,9 +209,12 @@ func newSenderImpl(
 		cfgComp: cfgComp,
 		logComp: logComp,
 
-		client:       client,
-		endpoints:    endpoints,
-		agentVersion: agentVersion.GetNumberAndPre(),
+		compress:         cfgComp.GetBool("agent_telemetry.use_compression"),
+		compressionLevel: cfgComp.GetInt("agent_telemetry.compression_level"),
+		client:           client,
+		endpoints:        endpoints,
+		agentVersion:     agentVersion.GetNumberAndPre(),
+
 		// pre-fill parts of payload which are not changing during run-time
 		payloadTemplate: Payload{
 			APIVersion: "v2",
@@ -321,11 +326,23 @@ func (s *senderImpl) flushSession(ss *senderSession) error {
 		return fmt.Errorf("failed to marshal agent telemetry payload: %w", err)
 	}
 
-	reqBody, err := scrubber.ScrubJSON(payloadJSON)
+	reqBodyRaw, err := scrubber.ScrubJSON(payloadJSON)
 	if err != nil {
 		return fmt.Errorf("failed to scrubl agent telemetry payload: %w", err)
 	}
 
+	// Try to compress the payload if needed
+	reqBody := reqBodyRaw
+	gzipCompressed := s.compress
+	if s.compress {
+		reqBody, err = gzipCompress(reqBodyRaw, s.compressionLevel)
+		if err != nil {
+			gzipCompressed = false
+			reqBody = reqBodyRaw
+			s.logComp.Errorf("Failed to compress agent telemetry payload: %v", err)
+		}
+	}
+
 	// Send the payload to all endpoints
 	var errs error
 	reqType := payloads.RequestType
@@ -337,7 +354,7 @@ func (s *senderImpl) flushSession(ss *senderSession) error {
 			errs = errors.Join(errs, err)
 			continue
 		}
-		s.addHeaders(req, reqType, ep.GetAPIKey(), bodyLen)
+		s.addHeaders(req, reqType, ep.GetAPIKey(), bodyLen, gzipCompressed)
 		resp, err := s.client.Do(req.WithContext(ss.cancelCtx))
 		if err != nil {
 			errs = errors.Join(errs, err)
@@ -387,7 +404,7 @@ func (s *senderImpl) sendAgentMetricPayloads(ss *senderSession, metrics []*agent
 	}
 }
 
-func (s *senderImpl) addHeaders(req *http.Request, requesttype, apikey, bodylen string) {
+func (s *senderImpl) addHeaders(req *http.Request, requesttype, apikey, bodylen string, gzipCompressed bool) {
 	req.Header.Add("DD-Api-Key", apikey)
 	req.Header.Add("Content-Type", "application/json")
 	req.Header.Add("Content-Length", bodylen)
@@ -397,4 +414,8 @@ func (s *senderImpl) addHeaders(req *http.Request, requesttype, apikey, bodylen
 	req.Header.Add("DD-Telemetry-Product-Version", s.agentVersion)
 	// Not clear how to acquire that. Appears that EVP adds it automatically
 	req.Header.Add("datadog-container-id", "")
+
+	if gzipCompressed {
+		req.Header.Set("Content-Encoding", "gzip")
+	}
 }
diff --git a/comp/core/agenttelemetry/impl/utils.go b/comp/core/agenttelemetry/impl/utils.go
index 07f6b86aebf402..a8f6c273e71bbe 100644
--- a/comp/core/agenttelemetry/impl/utils.go
+++ b/comp/core/agenttelemetry/impl/utils.go
@@ -6,6 +6,8 @@
 package agenttelemetryimpl
 
 import (
+	"bytes"
+	"compress/gzip"
 	"fmt"
 	"sort"
 
@@ -123,3 +125,25 @@ func cloneLabelsSorted(labels []*dto.LabelPair) []*dto.LabelPair {
 func makeLabelPairKey(l *dto.LabelPair) string {
 	return fmt.Sprintf("%s:%s:", l.GetName(), l.GetValue())
 }
+
+// Compresses payload via gzip
+func gzipCompress(payload []byte, compressionLevel int) ([]byte, error) {
+	var payloadCompressed bytes.Buffer
+	gzipWriter, err := gzip.NewWriterLevel(&payloadCompressed, compressionLevel)
+	if err != nil {
+		return nil, err
+	}
+	_, err = gzipWriter.Write(payload)
+	if err != nil {
+		return nil, err
+	}
+	err = gzipWriter.Flush()
+	if err != nil {
+		return nil, err
+	}
+	err = gzipWriter.Close()
+	if err != nil {
+		return nil, err
+	}
+	return payloadCompressed.Bytes(), nil
+}
diff --git a/releasenotes/notes/agent-tel-gzip-bba8a51c1aa3ba2f.yaml b/releasenotes/notes/agent-tel-gzip-bba8a51c1aa3ba2f.yaml
new file mode 100644
index 00000000000000..28813332bc7f1e
--- /dev/null
+++ b/releasenotes/notes/agent-tel-gzip-bba8a51c1aa3ba2f.yaml
@@ -0,0 +1,11 @@
+# Each section from every release note are combined when the
+# CHANGELOG.rst is rendered. So the text needs to be worded so that
+# it does not depend on any information only available in another
+# section. This may mean repeating some details, but each section
+# must be readable independently of the other.
+#
+# Each section note must be formatted as reStructuredText.
+---
+enhancements:
+  - |
+    Use HTTP gzip compression for the Agent telemetry payloads.