diff --git a/bom/application/pom.xml b/bom/application/pom.xml
index 2136dbb13a775b..aa101d2dbea816 100644
--- a/bom/application/pom.xml
+++ b/bom/application/pom.xml
@@ -1372,7 +1372,7 @@
             </dependency>
             <dependency>
                 <groupId>io.quarkus</groupId>
-                <artifactId>quarkus-smallrye-context-propagation-deployment-spi</artifactId>
+                <artifactId>quarkus-smallrye-context-propagation-spi</artifactId>
                 <version>${project.version}</version>
             </dependency>
             <dependency>
diff --git a/extensions/arc/deployment/pom.xml b/extensions/arc/deployment/pom.xml
index 5eb18e81e26a50..4ac95cec06da47 100644
--- a/extensions/arc/deployment/pom.xml
+++ b/extensions/arc/deployment/pom.xml
@@ -17,6 +17,10 @@
             <groupId>io.quarkus</groupId>
             <artifactId>quarkus-core-deployment</artifactId>
         </dependency>
+        <dependency>
+            <groupId>io.quarkus</groupId>
+            <artifactId>quarkus-smallrye-context-propagation-spi</artifactId>
+        </dependency>
         <dependency>
             <groupId>io.quarkus</groupId>
             <artifactId>quarkus-vertx-http-dev-console-spi</artifactId>
@@ -47,6 +51,11 @@
             <version>1.0.2.Final</version>
             <scope>test</scope>
         </dependency>
+        <dependency>
+            <groupId>io.quarkus</groupId>
+            <artifactId>quarkus-smallrye-context-propagation-deployment</artifactId>
+            <scope>test</scope>
+        </dependency>
 
     </dependencies>
 
diff --git a/extensions/arc/deployment/src/main/java/io/quarkus/arc/deployment/ArcConfig.java b/extensions/arc/deployment/src/main/java/io/quarkus/arc/deployment/ArcConfig.java
index 35159793b75f7b..2eeaa0e2041d25 100644
--- a/extensions/arc/deployment/src/main/java/io/quarkus/arc/deployment/ArcConfig.java
+++ b/extensions/arc/deployment/src/main/java/io/quarkus/arc/deployment/ArcConfig.java
@@ -203,6 +203,12 @@ public class ArcConfig {
     @ConfigItem
     public Optional<List<String>> ignoredSplitPackages;
 
+    /**
+     * Context propagation configuration.
+     */
+    @ConfigItem
+    public ArcContextPropagationConfig contextPropagation;
+
     public final boolean isRemoveUnusedBeansFieldValid() {
         return ALLOWED_REMOVE_UNUSED_BEANS_VALUES.contains(removeUnusedBeans.toLowerCase());
     }
diff --git a/extensions/arc/deployment/src/main/java/io/quarkus/arc/deployment/ArcContextPropagationConfig.java b/extensions/arc/deployment/src/main/java/io/quarkus/arc/deployment/ArcContextPropagationConfig.java
new file mode 100644
index 00000000000000..dee455eefed429
--- /dev/null
+++ b/extensions/arc/deployment/src/main/java/io/quarkus/arc/deployment/ArcContextPropagationConfig.java
@@ -0,0 +1,16 @@
+package io.quarkus.arc.deployment;
+
+import io.quarkus.runtime.annotations.ConfigGroup;
+import io.quarkus.runtime.annotations.ConfigItem;
+
+@ConfigGroup
+public class ArcContextPropagationConfig {
+
+    /**
+     * If set to true and SmallRye Context Propagation extension is present then enable the context propagation for CDI
+     * contexts.
+     */
+    @ConfigItem(defaultValue = "true")
+    public boolean enabled;
+
+}
diff --git a/extensions/arc/deployment/src/main/java/io/quarkus/arc/deployment/ArcProcessor.java b/extensions/arc/deployment/src/main/java/io/quarkus/arc/deployment/ArcProcessor.java
index f07140fff2de6a..abd6e9b6590862 100644
--- a/extensions/arc/deployment/src/main/java/io/quarkus/arc/deployment/ArcProcessor.java
+++ b/extensions/arc/deployment/src/main/java/io/quarkus/arc/deployment/ArcProcessor.java
@@ -81,6 +81,7 @@
 import io.quarkus.arc.runtime.BeanContainer;
 import io.quarkus.arc.runtime.LaunchModeProducer;
 import io.quarkus.arc.runtime.LoggerProducer;
+import io.quarkus.arc.runtime.context.ArcContextProvider;
 import io.quarkus.arc.runtime.test.PreloadedTestApplicationClassPredicate;
 import io.quarkus.bootstrap.BootstrapDebug;
 import io.quarkus.deployment.Capabilities;
@@ -114,6 +115,7 @@
 import io.quarkus.runtime.annotations.QuarkusMain;
 import io.quarkus.runtime.test.TestApplicationClassPredicate;
 import io.quarkus.runtime.util.HashUtil;
+import io.quarkus.smallrye.context.deployment.spi.ThreadContextProviderBuildItem;
 
 /**
  * This class contains build steps that trigger various phases of the bean processing.
@@ -813,6 +815,13 @@ void validateAsyncObserverExceptionHandlers(ValidationPhaseBuildItem validationP
         }
     }
 
+    @BuildStep
+    void registerContextPropagation(ArcConfig config, BuildProducer<ThreadContextProviderBuildItem> threadContextProvider) {
+        if (config.contextPropagation.enabled) {
+            threadContextProvider.produce(new ThreadContextProviderBuildItem(ArcContextProvider.class));
+        }
+    }
+
     private void registerListInjectionPointsBeans(BeanRegistrationPhaseBuildItem beanRegistrationPhase,
             List<InjectionPointInfo> injectionPoints, BuildProducer<ReflectiveMethodBuildItem> reflectiveMethods,
             BuildProducer<ReflectiveFieldBuildItem> reflectiveFields,
diff --git a/extensions/arc/deployment/src/test/java/io/quarkus/arc/test/cp/ContextProviderDisabledTest.java b/extensions/arc/deployment/src/test/java/io/quarkus/arc/test/cp/ContextProviderDisabledTest.java
new file mode 100644
index 00000000000000..9de7e983247f87
--- /dev/null
+++ b/extensions/arc/deployment/src/test/java/io/quarkus/arc/test/cp/ContextProviderDisabledTest.java
@@ -0,0 +1,74 @@
+package io.quarkus.arc.test.cp;
+
+import static org.junit.jupiter.api.Assertions.assertEquals;
+import static org.junit.jupiter.api.Assertions.assertFalse;
+import static org.junit.jupiter.api.Assertions.fail;
+
+import java.util.concurrent.ExecutionException;
+import java.util.concurrent.TimeUnit;
+import java.util.concurrent.TimeoutException;
+
+import javax.annotation.PostConstruct;
+import javax.enterprise.context.ContextNotActiveException;
+import javax.enterprise.context.RequestScoped;
+import javax.inject.Inject;
+
+import org.eclipse.microprofile.context.ManagedExecutor;
+import org.junit.jupiter.api.Test;
+import org.junit.jupiter.api.extension.RegisterExtension;
+
+import io.quarkus.arc.Arc;
+import io.quarkus.arc.ManagedContext;
+import io.quarkus.test.QuarkusUnitTest;
+
+public class ContextProviderDisabledTest {
+
+    @RegisterExtension
+    static final QuarkusUnitTest config = new QuarkusUnitTest().overrideConfigKey("quarkus.arc.context-propagation.enabled",
+            "false");
+
+    @Inject
+    ManagedExecutor all;
+
+    @Inject
+    MyRequestBean bean;
+
+    @Test
+    public void testPropagationDisabled() throws InterruptedException, ExecutionException, TimeoutException {
+        ManagedContext requestContext = Arc.container().requestContext();
+
+        requestContext.activate();
+        assertEquals("FOO", bean.getId());
+        try {
+            assertEquals("OK",
+                    all.completedFuture("OK").thenApplyAsync(text -> {
+                        assertFalse(requestContext.isActive());
+                        try {
+                            bean.getId();
+                            fail();
+                        } catch (ContextNotActiveException expected) {
+                        }
+                        return text;
+                    }).toCompletableFuture().get(5, TimeUnit.SECONDS));
+        } finally {
+            requestContext.terminate();
+        }
+    }
+
+    @RequestScoped
+    public static class MyRequestBean {
+
+        String id;
+
+        @PostConstruct
+        void init() {
+            id = "FOO";
+        }
+
+        public String getId() {
+            return id;
+        }
+
+    }
+
+}
diff --git a/extensions/arc/deployment/src/test/java/io/quarkus/arc/test/cp/ContextProviderEnabledTest.java b/extensions/arc/deployment/src/test/java/io/quarkus/arc/test/cp/ContextProviderEnabledTest.java
new file mode 100644
index 00000000000000..896330771e576d
--- /dev/null
+++ b/extensions/arc/deployment/src/test/java/io/quarkus/arc/test/cp/ContextProviderEnabledTest.java
@@ -0,0 +1,69 @@
+package io.quarkus.arc.test.cp;
+
+import static org.junit.jupiter.api.Assertions.assertEquals;
+import static org.junit.jupiter.api.Assertions.assertTrue;
+
+import java.util.concurrent.ExecutionException;
+import java.util.concurrent.TimeUnit;
+import java.util.concurrent.TimeoutException;
+
+import javax.annotation.PostConstruct;
+import javax.enterprise.context.RequestScoped;
+import javax.inject.Inject;
+
+import org.eclipse.microprofile.context.ManagedExecutor;
+import org.junit.jupiter.api.Test;
+import org.junit.jupiter.api.extension.RegisterExtension;
+
+import io.quarkus.arc.Arc;
+import io.quarkus.arc.ManagedContext;
+import io.quarkus.test.QuarkusUnitTest;
+
+public class ContextProviderEnabledTest {
+
+    @RegisterExtension
+    static final QuarkusUnitTest config = new QuarkusUnitTest().overrideConfigKey("quarkus.arc.context-propagation.enabled",
+            "true");
+
+    @Inject
+    ManagedExecutor all;
+
+    @Inject
+    MyRequestBean bean;
+
+    @Test
+    public void testPropagationDisabled() throws InterruptedException, ExecutionException, TimeoutException {
+        ManagedContext requestContext = Arc.container().requestContext();
+
+        requestContext.activate();
+        assertEquals("FOO", bean.getId());
+        try {
+            assertEquals("OK",
+                    all.completedFuture("OK").thenApplyAsync(text -> {
+                        assertTrue(requestContext.isActive());
+                        assertEquals("FOO", bean.getId());
+                        return text;
+                    }).toCompletableFuture().get(5, TimeUnit.SECONDS));
+            ;
+        } finally {
+            requestContext.terminate();
+        }
+    }
+
+    @RequestScoped
+    public static class MyRequestBean {
+
+        String id;
+
+        @PostConstruct
+        void init() {
+            id = "FOO";
+        }
+
+        public String getId() {
+            return id;
+        }
+
+    }
+
+}
diff --git a/extensions/arc/runtime/src/main/resources/META-INF/services/org.eclipse.microprofile.context.spi.ThreadContextProvider b/extensions/arc/runtime/src/main/resources/META-INF/services/org.eclipse.microprofile.context.spi.ThreadContextProvider
deleted file mode 100644
index 45ab8e34c62507..00000000000000
--- a/extensions/arc/runtime/src/main/resources/META-INF/services/org.eclipse.microprofile.context.spi.ThreadContextProvider
+++ /dev/null
@@ -1 +0,0 @@
-io.quarkus.arc.runtime.context.ArcContextProvider
\ No newline at end of file
diff --git a/extensions/smallrye-context-propagation/deployment/pom.xml b/extensions/smallrye-context-propagation/deployment/pom.xml
index 35d93b31deeb51..9b9c5e71d32c06 100644
--- a/extensions/smallrye-context-propagation/deployment/pom.xml
+++ b/extensions/smallrye-context-propagation/deployment/pom.xml
@@ -22,7 +22,7 @@
         </dependency>
         <dependency>
             <groupId>io.quarkus</groupId>
-            <artifactId>quarkus-smallrye-context-propagation-deployment-spi</artifactId>
+            <artifactId>quarkus-smallrye-context-propagation-spi</artifactId>
         </dependency>
         <dependency>
             <groupId>io.quarkus</groupId>
diff --git a/extensions/smallrye-context-propagation/spi/pom.xml b/extensions/smallrye-context-propagation/spi/pom.xml
index 9fd7fe09c096dd..3f2672224e5f19 100644
--- a/extensions/smallrye-context-propagation/spi/pom.xml
+++ b/extensions/smallrye-context-propagation/spi/pom.xml
@@ -10,8 +10,8 @@
     </parent>
     <modelVersion>4.0.0</modelVersion>
 
-    <artifactId>quarkus-smallrye-context-propagation-deployment-spi</artifactId>
-    <name>Quarkus - SmallRye Context Propagation - Deployment - SPI</name>
+    <artifactId>quarkus-smallrye-context-propagation-spi</artifactId>
+    <name>Quarkus - SmallRye Context Propagation - SPI</name>
 
     <dependencies>
         <dependency>