diff --git a/x-pack/plugin/ent-search/qa/full-cluster-restart/src/javaRestTest/java/org/elasticsearch/xpack/application/FullClusterRestartIT.java b/x-pack/plugin/ent-search/qa/full-cluster-restart/src/javaRestTest/java/org/elasticsearch/xpack/application/FullClusterRestartIT.java
index 6b1b6fc886825..95b3b576eb46c 100644
--- a/x-pack/plugin/ent-search/qa/full-cluster-restart/src/javaRestTest/java/org/elasticsearch/xpack/application/FullClusterRestartIT.java
+++ b/x-pack/plugin/ent-search/qa/full-cluster-restart/src/javaRestTest/java/org/elasticsearch/xpack/application/FullClusterRestartIT.java
@@ -11,6 +11,7 @@
 import org.elasticsearch.Version;
 import org.elasticsearch.client.Request;
 import org.elasticsearch.client.Response;
+import org.elasticsearch.client.ResponseException;
 import org.elasticsearch.test.cluster.ElasticsearchCluster;
 import org.elasticsearch.test.cluster.local.distribution.DistributionType;
 import org.elasticsearch.test.rest.ObjectPath;
@@ -22,12 +23,19 @@
 import java.util.List;
 
 import static org.elasticsearch.Version.V_8_12_0;
+import static org.hamcrest.Matchers.greaterThanOrEqualTo;
 
 public class FullClusterRestartIT extends ParameterizedFullClusterRestartTestCase {
-
+    // DSL was introduced with version 8.12.0 of ES.
     private static final Version DSL_DEFAULT_RETENTION_VERSION = V_8_12_0;
 
+    // DSL was introduced with the version 3 of the registry.
+    private static final int DSL_REGISTRY_VERSION = 3;
+
     // Legacy name we used for ILM policy configuration in versions prior to 8.12.0.
+    private static final String EVENT_DATA_STREAM_LEGACY_TEMPLATE_NAME = "behavioral_analytics-events-default";
+
+    // Event data streams template name.
     private static final String EVENT_DATA_STREAM_LEGACY_ILM_POLICY_NAME = "behavioral_analytics-events-default_policy";
 
     @ClassRule
@@ -36,6 +44,7 @@ public class FullClusterRestartIT extends ParameterizedFullClusterRestartTestCas
         .version(getOldClusterTestVersion())
         .nodes(2)
         .setting("xpack.security.enabled", "false")
+        .setting("xpack.license.self_generated.type", "trial")
         .module("x-pack-ent-search")
         .build();
 
@@ -48,7 +57,6 @@ protected ElasticsearchCluster getUpgradeCluster() {
         return cluster;
     }
 
-    @AwaitsFix(bugUrl = "https://github.com/elastic/elasticsearch/issues/104470")
     public void testBehavioralAnalyticsDataRetention() throws Exception {
         assumeTrue(
             "Data retention changed by default to DSL in " + DSL_DEFAULT_RETENTION_VERSION,
@@ -59,26 +67,32 @@ public void testBehavioralAnalyticsDataRetention() throws Exception {
         String newAnalyticsCollectionName = "newstuff";
 
         if (isRunningAgainstOldCluster()) {
+            // Ensure index template is installed before executing the tests.
+            assertBusy(() -> assertDataStreamTemplateExists(EVENT_DATA_STREAM_LEGACY_TEMPLATE_NAME));
+
             // Create an analytics collection
             Request legacyPutRequest = new Request("PUT", "_application/analytics/" + legacyAnalyticsCollectionName);
             assertOK(client().performRequest(legacyPutRequest));
 
             // Validate that ILM lifecycle is in place
-            assertBusy(() -> assertLegacyDataRetentionPolicy(legacyAnalyticsCollectionName));
+            assertBusy(() -> assertUsingLegacyDataRetentionPolicy(legacyAnalyticsCollectionName));
         } else {
+            // Ensure index template is updated to version 3 before executing the tests.
+            assertBusy(() -> assertDataStreamTemplateExists(EVENT_DATA_STREAM_LEGACY_TEMPLATE_NAME, DSL_REGISTRY_VERSION));
+
             // Create a new analytics collection
             Request putRequest = new Request("PUT", "_application/analytics/" + newAnalyticsCollectionName);
             assertOK(client().performRequest(putRequest));
 
             // Validate that NO ILM lifecycle is in place and we are using DLS instead.
-            assertBusy(() -> assertDslDataRetention(newAnalyticsCollectionName));
+            assertBusy(() -> assertUsingDslDataRetention(newAnalyticsCollectionName));
 
             // Validate that the existing analytics collection created with an older version is still using ILM
-            assertBusy(() -> assertLegacyDataRetentionPolicy(legacyAnalyticsCollectionName));
+            assertBusy(() -> assertUsingLegacyDataRetentionPolicy(legacyAnalyticsCollectionName));
         }
     }
 
-    private void assertLegacyDataRetentionPolicy(String analyticsCollectionName) throws IOException {
+    private void assertUsingLegacyDataRetentionPolicy(String analyticsCollectionName) throws IOException {
         String dataStreamName = "behavioral_analytics-events-" + analyticsCollectionName;
         Request getDataStreamRequest = new Request("GET", "_data_stream/" + dataStreamName);
         Response response = client().performRequest(getDataStreamRequest);
@@ -93,7 +107,7 @@ private void assertLegacyDataRetentionPolicy(String analyticsCollectionName) thr
         assertNotNull(policy.evaluate(EVENT_DATA_STREAM_LEGACY_ILM_POLICY_NAME));
     }
 
-    private void assertDslDataRetention(String analyticsCollectionName) throws IOException {
+    private void assertUsingDslDataRetention(String analyticsCollectionName) throws IOException {
         String dataStreamName = "behavioral_analytics-events-" + analyticsCollectionName;
         Request getDataStreamRequest = new Request("GET", "_data_stream/" + dataStreamName);
         Response response = client().performRequest(getDataStreamRequest);
@@ -105,13 +119,36 @@ private void assertDslDataRetention(String analyticsCollectionName) throws IOExc
         for (Object dataStreamObj : dataStreams) {
             ObjectPath dataStream = new ObjectPath(dataStreamObj);
             if (dataStreamName.equals(dataStream.evaluate("name"))) {
-                assertNull(dataStream.evaluate("ilm_policy"));
                 assertEquals(true, dataStream.evaluate("lifecycle.enabled"));
                 assertEquals("180d", dataStream.evaluate("lifecycle.data_retention"));
+                assertEquals("Data stream lifecycle", dataStream.evaluate("next_generation_managed_by"));
+                assertEquals(false, dataStream.evaluate("prefer_ilm"));
                 evaluatedNewDataStream = true;
             }
         }
         assertTrue(evaluatedNewDataStream);
+    }
 
+    private void assertDataStreamTemplateExists(String templateName) throws IOException {
+        assertDataStreamTemplateExists(templateName, null);
+    }
+
+    private void assertDataStreamTemplateExists(String templateName, Integer minVersion) throws IOException {
+        try {
+            Request getIndexTemplateRequest = new Request("GET", "_index_template/" + templateName);
+            Response response = client().performRequest(getIndexTemplateRequest);
+            assertOK(response);
+            if (minVersion != null) {
+                String pathToVersion = "index_templates.0.index_template.version";
+                ObjectPath indexTemplatesResponse = ObjectPath.createFromResponse(response);
+                assertThat(indexTemplatesResponse.evaluate(pathToVersion), greaterThanOrEqualTo(minVersion));
+            }
+        } catch (ResponseException e) {
+            int status = e.getResponse().getStatusLine().getStatusCode();
+            if (status == 404) {
+                throw new AssertionError("Waiting for the template to be created");
+            }
+            throw e;
+        }
     }
 }