diff --git a/instrumentation/executors/bootstrap/src/main/java/io/opentelemetry/javaagent/bootstrap/executors/ContextPropagatingRunnable.java b/instrumentation/executors/bootstrap/src/main/java/io/opentelemetry/javaagent/bootstrap/executors/ContextPropagatingRunnable.java
new file mode 100644
index 000000000000..f3e4846c9adb
--- /dev/null
+++ b/instrumentation/executors/bootstrap/src/main/java/io/opentelemetry/javaagent/bootstrap/executors/ContextPropagatingRunnable.java
@@ -0,0 +1,39 @@
+/*
+ * Copyright The OpenTelemetry Authors
+ * SPDX-License-Identifier: Apache-2.0
+ */
+
+package io.opentelemetry.javaagent.bootstrap.executors;
+
+import io.opentelemetry.context.Context;
+import io.opentelemetry.context.Scope;
+
+public final class ContextPropagatingRunnable implements Runnable {
+
+  public static boolean shouldDecorateRunnable(Runnable task) {
+    // We wrap only lambdas' anonymous classes and if given object has not already been wrapped.
+    // Anonymous classes have '/' in class name which is not allowed in 'normal' classes.
+    // note: it is always safe to decorate lambdas since downstream code cannot be expecting a
+    // specific runnable implementation anyways
+    return task.getClass().getName().contains("/") && !(task instanceof ContextPropagatingRunnable);
+  }
+
+  public static Runnable propagateContext(Runnable task, Context context) {
+    return new ContextPropagatingRunnable(task, context);
+  }
+
+  private final Runnable delegate;
+  private final Context context;
+
+  private ContextPropagatingRunnable(Runnable delegate, Context context) {
+    this.delegate = delegate;
+    this.context = context;
+  }
+
+  @Override
+  public void run() {
+    try (Scope ignored = context.makeCurrent()) {
+      delegate.run();
+    }
+  }
+}
diff --git a/instrumentation/executors/javaagent/src/main/java/io/opentelemetry/javaagent/instrumentation/executors/JavaExecutorInstrumentation.java b/instrumentation/executors/javaagent/src/main/java/io/opentelemetry/javaagent/instrumentation/executors/JavaExecutorInstrumentation.java
index 07949cbe16b1..a1835d71948e 100644
--- a/instrumentation/executors/javaagent/src/main/java/io/opentelemetry/javaagent/instrumentation/executors/JavaExecutorInstrumentation.java
+++ b/instrumentation/executors/javaagent/src/main/java/io/opentelemetry/javaagent/instrumentation/executors/JavaExecutorInstrumentation.java
@@ -16,6 +16,7 @@
 import io.opentelemetry.context.Context;
 import io.opentelemetry.instrumentation.api.util.VirtualField;
 import io.opentelemetry.javaagent.bootstrap.Java8BytecodeBridge;
+import io.opentelemetry.javaagent.bootstrap.executors.ContextPropagatingRunnable;
 import io.opentelemetry.javaagent.bootstrap.executors.ExecutorAdviceHelper;
 import io.opentelemetry.javaagent.bootstrap.executors.PropagatedContext;
 import io.opentelemetry.javaagent.extension.instrumentation.TypeTransformer;
@@ -80,12 +81,16 @@ public static class SetExecuteRunnableStateAdvice {
     public static PropagatedContext enterJobSubmit(
         @Advice.Argument(value = 0, readOnly = false) Runnable task) {
       Context context = Java8BytecodeBridge.currentContext();
-      if (ExecutorAdviceHelper.shouldPropagateContext(context, task)) {
-        VirtualField<Runnable, PropagatedContext> virtualField =
-            VirtualField.find(Runnable.class, PropagatedContext.class);
-        return ExecutorAdviceHelper.attachContextToTask(context, virtualField, task);
+      if (!ExecutorAdviceHelper.shouldPropagateContext(context, task)) {
+        return null;
       }
-      return null;
+      if (ContextPropagatingRunnable.shouldDecorateRunnable(task)) {
+        task = ContextPropagatingRunnable.propagateContext(task, context);
+        return null;
+      }
+      VirtualField<Runnable, PropagatedContext> virtualField =
+          VirtualField.find(Runnable.class, PropagatedContext.class);
+      return ExecutorAdviceHelper.attachContextToTask(context, virtualField, task);
     }
 
     @Advice.OnMethodExit(onThrowable = Throwable.class, suppress = Throwable.class)
diff --git a/instrumentation/executors/javaagent/src/test/java/io/opentelemetry/javaagent/instrumentation/executors/LambdaContextPropagationTest.java b/instrumentation/executors/javaagent/src/test/java/io/opentelemetry/javaagent/instrumentation/executors/LambdaContextPropagationTest.java
new file mode 100644
index 000000000000..ad46803d30ab
--- /dev/null
+++ b/instrumentation/executors/javaagent/src/test/java/io/opentelemetry/javaagent/instrumentation/executors/LambdaContextPropagationTest.java
@@ -0,0 +1,44 @@
+/*
+ * Copyright The OpenTelemetry Authors
+ * SPDX-License-Identifier: Apache-2.0
+ */
+
+package io.opentelemetry.javaagent.instrumentation.executors;
+
+import static org.assertj.core.api.Assertions.assertThat;
+
+import io.opentelemetry.api.baggage.Baggage;
+import io.opentelemetry.context.Scope;
+import java.util.concurrent.ExecutorService;
+import java.util.concurrent.Executors;
+import java.util.concurrent.atomic.AtomicInteger;
+import org.junit.jupiter.api.Test;
+
+// regression test for #9175
+class LambdaContextPropagationTest {
+
+  // must be static! the lambda that uses that must be non-capturing
+  private static final AtomicInteger failureCounter = new AtomicInteger();
+
+  @Test
+  void shouldCorrectlyPropagateContextToRunnables() {
+    ExecutorService executor = Executors.newSingleThreadExecutor();
+
+    Baggage baggage = Baggage.builder().put("test", "test").build();
+    try (Scope ignored = baggage.makeCurrent()) {
+      for (int i = 0; i < 20; i++) {
+        // must text execute() -- other methods like submit() decorate the Runnable with a
+        // FutureTask
+        executor.execute(LambdaContextPropagationTest::assertBaggage);
+      }
+    }
+
+    assertThat(failureCounter).hasValue(0);
+  }
+
+  private static void assertBaggage() {
+    if (Baggage.current().getEntryValue("test") == null) {
+      failureCounter.incrementAndGet();
+    }
+  }
+}