diff --git a/packages/schematics/angular/migrations/migration-collection.json b/packages/schematics/angular/migrations/migration-collection.json
index cb265c98c51b..afebb2c8fe04 100644
--- a/packages/schematics/angular/migrations/migration-collection.json
+++ b/packages/schematics/angular/migrations/migration-collection.json
@@ -9,6 +9,11 @@
       "version": "16.0.0",
       "factory": "./update-16/replace-default-collection-option",
       "description": "Replace removed 'defaultCollection' option in workspace configuration with 'schematicCollections'."
+    },
+    "update-server-builder-config": {
+      "version": "16.0.0",
+      "factory": "./update-16/update-server-builder-config",
+      "description": "Update the '@angular-devkit/build-angular:server' builder configuration to disable 'buildOptimizer' for non optimized builds."
     }
   }
 }
diff --git a/packages/schematics/angular/migrations/update-16/update-server-builder-config.ts b/packages/schematics/angular/migrations/update-16/update-server-builder-config.ts
new file mode 100644
index 000000000000..534a7f9930d9
--- /dev/null
+++ b/packages/schematics/angular/migrations/update-16/update-server-builder-config.ts
@@ -0,0 +1,30 @@
+/**
+ * @license
+ * Copyright Google LLC All Rights Reserved.
+ *
+ * Use of this source code is governed by an MIT-style license that can be
+ * found in the LICENSE file at https://angular.io/license
+ */
+
+import { Rule } from '@angular-devkit/schematics';
+import { allTargetOptions, updateWorkspace } from '../../utility/workspace';
+import { Builders } from '../../utility/workspace-models';
+
+export default function (): Rule {
+  return updateWorkspace((workspace) => {
+    for (const project of workspace.projects.values()) {
+      for (const target of project.targets.values()) {
+        if (target.builder !== Builders.Server) {
+          continue;
+        }
+
+        for (const [, options] of allTargetOptions(target)) {
+          // Set 'buildOptimizer' to match the 'optimization' option.
+          if (options.buildOptimizer === undefined && options.optimization !== undefined) {
+            options.buildOptimizer = !!options.optimization;
+          }
+        }
+      }
+    }
+  });
+}
diff --git a/packages/schematics/angular/migrations/update-16/update-server-builder-config_spec.ts b/packages/schematics/angular/migrations/update-16/update-server-builder-config_spec.ts
new file mode 100644
index 000000000000..fa8683c5b53b
--- /dev/null
+++ b/packages/schematics/angular/migrations/update-16/update-server-builder-config_spec.ts
@@ -0,0 +1,91 @@
+/**
+ * @license
+ * Copyright Google LLC All Rights Reserved.
+ *
+ * Use of this source code is governed by an MIT-style license that can be
+ * found in the LICENSE file at https://angular.io/license
+ */
+
+import { JsonObject } from '@angular-devkit/core';
+import { EmptyTree } from '@angular-devkit/schematics';
+import { SchematicTestRunner, UnitTestTree } from '@angular-devkit/schematics/testing';
+import {
+  BuilderTarget,
+  Builders,
+  ProjectType,
+  WorkspaceSchema,
+} from '../../utility/workspace-models';
+
+function getServerTarget(tree: UnitTestTree): BuilderTarget<Builders.Server, JsonObject> {
+  const target = (tree.readJson('/angular.json') as unknown as WorkspaceSchema).projects.app
+    .architect?.server;
+
+  return target as unknown as BuilderTarget<Builders.Server, JsonObject>;
+}
+
+function createWorkSpaceConfig(tree: UnitTestTree) {
+  const angularConfig: WorkspaceSchema = {
+    version: 1,
+    projects: {
+      app: {
+        root: '',
+        sourceRoot: 'src',
+        projectType: ProjectType.Application,
+        prefix: 'app',
+        architect: {
+          server: {
+            builder: Builders.Server,
+            options: {
+              main: './server.ts',
+              // eslint-disable-next-line @typescript-eslint/no-explicit-any
+            } as any,
+            configurations: {
+              development: {
+                optimization: false,
+              },
+              production: {
+                optimization: true,
+              },
+              // eslint-disable-next-line @typescript-eslint/no-explicit-any
+            } as any,
+          },
+        },
+      },
+    },
+  };
+
+  tree.create('/angular.json', JSON.stringify(angularConfig, undefined, 2));
+}
+
+const schematicName = 'update-server-builder-config';
+
+describe(`Migration to update '@angular-devkit/build-angular:server' options. ${schematicName}`, () => {
+  const schematicRunner = new SchematicTestRunner(
+    'migrations',
+    require.resolve('../migration-collection.json'),
+  );
+
+  let tree: UnitTestTree;
+  beforeEach(() => {
+    tree = new UnitTestTree(new EmptyTree());
+    createWorkSpaceConfig(tree);
+  });
+
+  it(`should add 'buildOptimizer: false' to 'optimization' is 'false'`, async () => {
+    const newTree = await schematicRunner.runSchematic(schematicName, {}, tree);
+    const { configurations } = getServerTarget(newTree);
+    expect(configurations?.development.buildOptimizer).toBeFalse();
+  });
+
+  it(`should not add 'buildOptimizer' option when to 'optimization' is not defined.`, async () => {
+    const newTree = await schematicRunner.runSchematic(schematicName, {}, tree);
+    const { options } = getServerTarget(newTree);
+    expect(options.buildOptimizer).toBeUndefined();
+  });
+
+  it(`should add 'buildOptimizer: true' to 'optimization' is 'true'`, async () => {
+    const newTree = await schematicRunner.runSchematic(schematicName, {}, tree);
+    const { configurations } = getServerTarget(newTree);
+    expect(configurations?.production.buildOptimizer).toBeTrue();
+  });
+});