diff --git a/test/e2e/clusterctl_upgrade_test.go b/test/e2e/clusterctl_upgrade_test.go
index 27376005737b..b36beaaa215d 100644
--- a/test/e2e/clusterctl_upgrade_test.go
+++ b/test/e2e/clusterctl_upgrade_test.go
@@ -87,9 +87,9 @@ var _ = Describe("When testing clusterctl upgrades (v1.4=>current)", func() {
 			// try to deploy the latest version of our test-extension from docker.yaml.
 			InitWithRuntimeExtensionProviders: []string{},
 			InitWithProvidersContract:         "v1beta1",
-			// NOTE: If this version is changed here the image and SHA must also be updated in all DockerMachineTemplates in `test/data/infrastructure-docker/v1.3/bases.
-			InitWithKubernetesVersion: "v1.26.4",
-			WorkloadKubernetesVersion: "v1.26.4",
+			// NOTE: If this version is changed here the image and SHA must also be updated in all DockerMachineTemplates in `test/e2e/data/infrastructure-docker/v1.4/bases.
+			InitWithKubernetesVersion: "v1.27.1",
+			WorkloadKubernetesVersion: "v1.27.1",
 			MgmtFlavor:                "topology",
 			WorkloadFlavor:            "",
 			// This check ensures that ownerReference apiVersions are updated for all types after the upgrade.
@@ -128,9 +128,9 @@ var _ = Describe("When testing clusterctl upgrades using ClusterClass (v1.4=>cur
 			// try to deploy the latest version of our test-extension from docker.yaml.
 			InitWithRuntimeExtensionProviders: []string{},
 			InitWithProvidersContract:         "v1beta1",
-			// NOTE: If this version is changed here the image and SHA must also be updated in all DockerMachineTemplates in `test/data/infrastructure-docker/v1.3/bases.
-			InitWithKubernetesVersion: "v1.26.4",
-			WorkloadKubernetesVersion: "v1.26.4",
+			// NOTE: If this version is changed here the image and SHA must also be updated in all DockerMachineTemplates in `test/e2e/data/infrastructure-docker/v1.4/bases.
+			InitWithKubernetesVersion: "v1.27.1",
+			WorkloadKubernetesVersion: "v1.27.1",
 			MgmtFlavor:                "topology",
 			WorkloadFlavor:            "topology",
 			// This check ensures that ownerReference apiVersions are updated for all types after the upgrade.
@@ -159,7 +159,7 @@ var _ = Describe("When testing clusterctl upgrades (v1.5=>current)", func() {
 			InfrastructureProvider:    pointer.String("docker"),
 			InitWithBinary:            "https://github.com/kubernetes-sigs/cluster-api/releases/download/v1.5.0/clusterctl-{OS}-{ARCH}",
 			InitWithProvidersContract: "v1beta1",
-			// NOTE: If this version is changed here the image and SHA must also be updated in all DockerMachineTemplates in `test/data/infrastructure-docker/v1.4/bases.
+			// NOTE: If this version is changed here the image and SHA must also be updated in all DockerMachineTemplates in `test/e2e/data/infrastructure-docker/v1.5/bases.
 			InitWithKubernetesVersion: "v1.27.3",
 			WorkloadKubernetesVersion: "v1.27.3",
 			MgmtFlavor:                "topology",
@@ -190,7 +190,7 @@ var _ = Describe("When testing clusterctl upgrades using ClusterClass (v1.5=>cur
 			InfrastructureProvider:    pointer.String("docker"),
 			InitWithBinary:            "https://github.com/kubernetes-sigs/cluster-api/releases/download/v1.5.0/clusterctl-{OS}-{ARCH}",
 			InitWithProvidersContract: "v1beta1",
-			// NOTE: If this version is changed here the image and SHA must also be updated in all DockerMachineTemplates in `test/data/infrastructure-docker/v1.4/bases.
+			// NOTE: If this version is changed here the image and SHA must also be updated in all DockerMachineTemplates in `test/e2e/data/infrastructure-docker/v1.5/bases.
 			InitWithKubernetesVersion: "v1.27.3",
 			WorkloadKubernetesVersion: "v1.27.3",
 			MgmtFlavor:                "topology",