diff --git a/drivers/net/ethernet/mellanox/mlx5/core/Makefile b/drivers/net/ethernet/mellanox/mlx5/core/Makefile
index 79fe09de0a9f..10a763e668ed 100644
--- a/drivers/net/ethernet/mellanox/mlx5/core/Makefile
+++ b/drivers/net/ethernet/mellanox/mlx5/core/Makefile
@@ -123,6 +123,7 @@ mlx5_core-$(CONFIG_MLX5_SW_STEERING) += steering/sws/dr_domain.o \
 					steering/sws/dr_ste_v0.o \
 					steering/sws/dr_ste_v1.o \
 					steering/sws/dr_ste_v2.o \
+					steering/sws/dr_ste_v3.o \
 					steering/sws/dr_cmd.o \
 					steering/sws/dr_fw.o \
 					steering/sws/dr_action.o \
diff --git a/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_domain.c b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_domain.c
index 3d74109f8230..bd361ba6658c 100644
--- a/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_domain.c
+++ b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_domain.c
@@ -8,7 +8,7 @@
 #define DR_DOMAIN_SW_STEERING_SUPPORTED(dmn, dmn_type)	\
 	((dmn)->info.caps.dmn_type##_sw_owner ||	\
 	 ((dmn)->info.caps.dmn_type##_sw_owner_v2 &&	\
-	  (dmn)->info.caps.sw_format_ver <= MLX5_STEERING_FORMAT_CONNECTX_7))
+	  (dmn)->info.caps.sw_format_ver <= MLX5_STEERING_FORMAT_CONNECTX_8))
 
 bool mlx5dr_domain_is_support_ptrn_arg(struct mlx5dr_domain *dmn)
 {
diff --git a/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_ste.c b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_ste.c
index 01ba8eae2983..c8b8ff80c7c7 100644
--- a/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_ste.c
+++ b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_ste.c
@@ -1458,6 +1458,8 @@ struct mlx5dr_ste_ctx *mlx5dr_ste_get_ctx(u8 version)
 		return mlx5dr_ste_get_ctx_v1();
 	else if (version == MLX5_STEERING_FORMAT_CONNECTX_7)
 		return mlx5dr_ste_get_ctx_v2();
+	else if (version == MLX5_STEERING_FORMAT_CONNECTX_8)
+		return mlx5dr_ste_get_ctx_v3();
 
 	return NULL;
 }
diff --git a/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_ste.h b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_ste.h
index b6ec8d30d990..5f409dc30aca 100644
--- a/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_ste.h
+++ b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_ste.h
@@ -217,5 +217,6 @@ struct mlx5dr_ste_ctx {
 struct mlx5dr_ste_ctx *mlx5dr_ste_get_ctx_v0(void);
 struct mlx5dr_ste_ctx *mlx5dr_ste_get_ctx_v1(void);
 struct mlx5dr_ste_ctx *mlx5dr_ste_get_ctx_v2(void);
+struct mlx5dr_ste_ctx *mlx5dr_ste_get_ctx_v3(void);
 
 #endif  /* _DR_STE_ */
diff --git a/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_ste_v3.c b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_ste_v3.c
new file mode 100644
index 000000000000..cc60ce1d274e
--- /dev/null
+++ b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/dr_ste_v3.c
@@ -0,0 +1,221 @@
+// SPDX-License-Identifier: GPL-2.0 OR Linux-OpenIB
+/* Copyright (c) 2024, NVIDIA CORPORATION & AFFILIATES. All rights reserved. */
+
+#include "dr_ste_v1.h"
+#include "dr_ste_v2.h"
+
+static void dr_ste_v3_set_encap(u8 *hw_ste_p, u8 *d_action,
+				u32 reformat_id, int size)
+{
+	MLX5_SET(ste_double_action_insert_with_ptr_v3, d_action, action_id,
+		 DR_STE_V1_ACTION_ID_INSERT_POINTER);
+	/* The hardware expects here size in words (2 byte) */
+	MLX5_SET(ste_double_action_insert_with_ptr_v3, d_action, size, size / 2);
+	MLX5_SET(ste_double_action_insert_with_ptr_v3, d_action, pointer, reformat_id);
+	MLX5_SET(ste_double_action_insert_with_ptr_v3, d_action, attributes,
+		 DR_STE_V1_ACTION_INSERT_PTR_ATTR_ENCAP);
+	dr_ste_v1_set_reparse(hw_ste_p);
+}
+
+static void dr_ste_v3_set_push_vlan(u8 *ste, u8 *d_action,
+				    u32 vlan_hdr)
+{
+	MLX5_SET(ste_double_action_insert_with_inline_v3, d_action, action_id,
+		 DR_STE_V1_ACTION_ID_INSERT_INLINE);
+	/* The hardware expects here offset to vlan header in words (2 byte) */
+	MLX5_SET(ste_double_action_insert_with_inline_v3, d_action, start_offset,
+		 HDR_LEN_L2_MACS >> 1);
+	MLX5_SET(ste_double_action_insert_with_inline_v3, d_action, inline_data, vlan_hdr);
+	dr_ste_v1_set_reparse(ste);
+}
+
+static void dr_ste_v3_set_pop_vlan(u8 *hw_ste_p, u8 *s_action,
+				   u8 vlans_num)
+{
+	MLX5_SET(ste_single_action_remove_header_size_v3, s_action,
+		 action_id, DR_STE_V1_ACTION_ID_REMOVE_BY_SIZE);
+	MLX5_SET(ste_single_action_remove_header_size_v3, s_action,
+		 start_anchor, DR_STE_HEADER_ANCHOR_1ST_VLAN);
+	/* The hardware expects here size in words (2 byte) */
+	MLX5_SET(ste_single_action_remove_header_size_v3, s_action,
+		 remove_size, (HDR_LEN_L2_VLAN >> 1) * vlans_num);
+
+	dr_ste_v1_set_reparse(hw_ste_p);
+}
+
+static void dr_ste_v3_set_encap_l3(u8 *hw_ste_p,
+				   u8 *frst_s_action,
+				   u8 *scnd_d_action,
+				   u32 reformat_id,
+				   int size)
+{
+	/* Remove L2 headers */
+	MLX5_SET(ste_single_action_remove_header_v3, frst_s_action, action_id,
+		 DR_STE_V1_ACTION_ID_REMOVE_HEADER_TO_HEADER);
+	MLX5_SET(ste_single_action_remove_header_v3, frst_s_action, end_anchor,
+		 DR_STE_HEADER_ANCHOR_IPV6_IPV4);
+
+	/* Encapsulate with given reformat ID */
+	MLX5_SET(ste_double_action_insert_with_ptr_v3, scnd_d_action, action_id,
+		 DR_STE_V1_ACTION_ID_INSERT_POINTER);
+	/* The hardware expects here size in words (2 byte) */
+	MLX5_SET(ste_double_action_insert_with_ptr_v3, scnd_d_action, size, size / 2);
+	MLX5_SET(ste_double_action_insert_with_ptr_v3, scnd_d_action, pointer, reformat_id);
+	MLX5_SET(ste_double_action_insert_with_ptr_v3, scnd_d_action, attributes,
+		 DR_STE_V1_ACTION_INSERT_PTR_ATTR_ENCAP);
+
+	dr_ste_v1_set_reparse(hw_ste_p);
+}
+
+static void dr_ste_v3_set_rx_decap(u8 *hw_ste_p, u8 *s_action)
+{
+	MLX5_SET(ste_single_action_remove_header_v3, s_action, action_id,
+		 DR_STE_V1_ACTION_ID_REMOVE_HEADER_TO_HEADER);
+	MLX5_SET(ste_single_action_remove_header_v3, s_action, decap, 1);
+	MLX5_SET(ste_single_action_remove_header_v3, s_action, vni_to_cqe, 1);
+	MLX5_SET(ste_single_action_remove_header_v3, s_action, end_anchor,
+		 DR_STE_HEADER_ANCHOR_INNER_MAC);
+
+	dr_ste_v1_set_reparse(hw_ste_p);
+}
+
+static int
+dr_ste_v3_set_action_decap_l3_list(void *data, u32 data_sz,
+				   u8 *hw_action, u32 hw_action_sz,
+				   uint16_t *used_hw_action_num)
+{
+	u8 padded_data[DR_STE_L2_HDR_MAX_SZ] = {};
+	void *data_ptr = padded_data;
+	u16 used_actions = 0;
+	u32 inline_data_sz;
+	u32 i;
+
+	if (hw_action_sz / DR_STE_ACTION_DOUBLE_SZ < DR_STE_DECAP_L3_ACTION_NUM)
+		return -EINVAL;
+
+	inline_data_sz =
+		MLX5_FLD_SZ_BYTES(ste_double_action_insert_with_inline_v3, inline_data);
+
+	/* Add an alignment padding  */
+	memcpy(padded_data + data_sz % inline_data_sz, data, data_sz);
+
+	/* Remove L2L3 outer headers */
+	MLX5_SET(ste_single_action_remove_header_v3, hw_action, action_id,
+		 DR_STE_V1_ACTION_ID_REMOVE_HEADER_TO_HEADER);
+	MLX5_SET(ste_single_action_remove_header_v3, hw_action, decap, 1);
+	MLX5_SET(ste_single_action_remove_header_v3, hw_action, vni_to_cqe, 1);
+	MLX5_SET(ste_single_action_remove_header_v3, hw_action, end_anchor,
+		 DR_STE_HEADER_ANCHOR_INNER_IPV6_IPV4);
+	hw_action += DR_STE_ACTION_DOUBLE_SZ;
+	used_actions++; /* Remove and NOP are a single double action */
+
+	/* Point to the last dword of the header */
+	data_ptr += (data_sz / inline_data_sz) * inline_data_sz;
+
+	/* Add the new header using inline action 4Byte at a time, the header
+	 * is added in reversed order to the beginning of the packet to avoid
+	 * incorrect parsing by the HW. Since header is 14B or 18B an extra
+	 * two bytes are padded and later removed.
+	 */
+	for (i = 0; i < data_sz / inline_data_sz + 1; i++) {
+		void *addr_inline;
+
+		MLX5_SET(ste_double_action_insert_with_inline_v3, hw_action, action_id,
+			 DR_STE_V1_ACTION_ID_INSERT_INLINE);
+		/* The hardware expects here offset to words (2 bytes) */
+		MLX5_SET(ste_double_action_insert_with_inline_v3, hw_action, start_offset, 0);
+
+		/* Copy bytes one by one to avoid endianness problem */
+		addr_inline = MLX5_ADDR_OF(ste_double_action_insert_with_inline_v3,
+					   hw_action, inline_data);
+		memcpy(addr_inline, data_ptr - i * inline_data_sz, inline_data_sz);
+		hw_action += DR_STE_ACTION_DOUBLE_SZ;
+		used_actions++;
+	}
+
+	/* Remove first 2 extra bytes */
+	MLX5_SET(ste_single_action_remove_header_size_v3, hw_action, action_id,
+		 DR_STE_V1_ACTION_ID_REMOVE_BY_SIZE);
+	MLX5_SET(ste_single_action_remove_header_size_v3, hw_action, start_offset, 0);
+	/* The hardware expects here size in words (2 bytes) */
+	MLX5_SET(ste_single_action_remove_header_size_v3, hw_action, remove_size, 1);
+	used_actions++;
+
+	*used_hw_action_num = used_actions;
+
+	return 0;
+}
+
+static struct mlx5dr_ste_ctx ste_ctx_v3 = {
+	/* Builders */
+	.build_eth_l2_src_dst_init	= &dr_ste_v1_build_eth_l2_src_dst_init,
+	.build_eth_l3_ipv6_src_init	= &dr_ste_v1_build_eth_l3_ipv6_src_init,
+	.build_eth_l3_ipv6_dst_init	= &dr_ste_v1_build_eth_l3_ipv6_dst_init,
+	.build_eth_l3_ipv4_5_tuple_init	= &dr_ste_v1_build_eth_l3_ipv4_5_tuple_init,
+	.build_eth_l2_src_init		= &dr_ste_v1_build_eth_l2_src_init,
+	.build_eth_l2_dst_init		= &dr_ste_v1_build_eth_l2_dst_init,
+	.build_eth_l2_tnl_init		= &dr_ste_v1_build_eth_l2_tnl_init,
+	.build_eth_l3_ipv4_misc_init	= &dr_ste_v1_build_eth_l3_ipv4_misc_init,
+	.build_eth_ipv6_l3_l4_init	= &dr_ste_v1_build_eth_ipv6_l3_l4_init,
+	.build_mpls_init		= &dr_ste_v1_build_mpls_init,
+	.build_tnl_gre_init		= &dr_ste_v1_build_tnl_gre_init,
+	.build_tnl_mpls_init		= &dr_ste_v1_build_tnl_mpls_init,
+	.build_tnl_mpls_over_udp_init	= &dr_ste_v1_build_tnl_mpls_over_udp_init,
+	.build_tnl_mpls_over_gre_init	= &dr_ste_v1_build_tnl_mpls_over_gre_init,
+	.build_icmp_init		= &dr_ste_v1_build_icmp_init,
+	.build_general_purpose_init	= &dr_ste_v1_build_general_purpose_init,
+	.build_eth_l4_misc_init		= &dr_ste_v1_build_eth_l4_misc_init,
+	.build_tnl_vxlan_gpe_init	= &dr_ste_v1_build_flex_parser_tnl_vxlan_gpe_init,
+	.build_tnl_geneve_init		= &dr_ste_v1_build_flex_parser_tnl_geneve_init,
+	.build_tnl_geneve_tlv_opt_init	= &dr_ste_v1_build_flex_parser_tnl_geneve_tlv_opt_init,
+	.build_tnl_geneve_tlv_opt_exist_init =
+				  &dr_ste_v1_build_flex_parser_tnl_geneve_tlv_opt_exist_init,
+	.build_register_0_init		= &dr_ste_v1_build_register_0_init,
+	.build_register_1_init		= &dr_ste_v1_build_register_1_init,
+	.build_src_gvmi_qpn_init	= &dr_ste_v1_build_src_gvmi_qpn_init,
+	.build_flex_parser_0_init	= &dr_ste_v1_build_flex_parser_0_init,
+	.build_flex_parser_1_init	= &dr_ste_v1_build_flex_parser_1_init,
+	.build_tnl_gtpu_init		= &dr_ste_v1_build_flex_parser_tnl_gtpu_init,
+	.build_tnl_header_0_1_init	= &dr_ste_v1_build_tnl_header_0_1_init,
+	.build_tnl_gtpu_flex_parser_0_init = &dr_ste_v1_build_tnl_gtpu_flex_parser_0_init,
+	.build_tnl_gtpu_flex_parser_1_init = &dr_ste_v1_build_tnl_gtpu_flex_parser_1_init,
+
+	/* Getters and Setters */
+	.ste_init			= &dr_ste_v1_init,
+	.set_next_lu_type		= &dr_ste_v1_set_next_lu_type,
+	.get_next_lu_type		= &dr_ste_v1_get_next_lu_type,
+	.is_miss_addr_set		= &dr_ste_v1_is_miss_addr_set,
+	.set_miss_addr			= &dr_ste_v1_set_miss_addr,
+	.get_miss_addr			= &dr_ste_v1_get_miss_addr,
+	.set_hit_addr			= &dr_ste_v1_set_hit_addr,
+	.set_byte_mask			= &dr_ste_v1_set_byte_mask,
+	.get_byte_mask			= &dr_ste_v1_get_byte_mask,
+
+	/* Actions */
+	.actions_caps			= DR_STE_CTX_ACTION_CAP_TX_POP |
+					  DR_STE_CTX_ACTION_CAP_RX_PUSH |
+					  DR_STE_CTX_ACTION_CAP_RX_ENCAP,
+	.set_actions_rx			= &dr_ste_v1_set_actions_rx,
+	.set_actions_tx			= &dr_ste_v1_set_actions_tx,
+	.modify_field_arr_sz		= ARRAY_SIZE(dr_ste_v2_action_modify_field_arr),
+	.modify_field_arr		= dr_ste_v2_action_modify_field_arr,
+	.set_action_set			= &dr_ste_v1_set_action_set,
+	.set_action_add			= &dr_ste_v1_set_action_add,
+	.set_action_copy		= &dr_ste_v1_set_action_copy,
+	.set_action_decap_l3_list	= &dr_ste_v3_set_action_decap_l3_list,
+	.alloc_modify_hdr_chunk		= &dr_ste_v1_alloc_modify_hdr_ptrn_arg,
+	.dealloc_modify_hdr_chunk	= &dr_ste_v1_free_modify_hdr_ptrn_arg,
+	/* Actions bit set */
+	.set_encap			= &dr_ste_v3_set_encap,
+	.set_push_vlan			= &dr_ste_v3_set_push_vlan,
+	.set_pop_vlan			= &dr_ste_v3_set_pop_vlan,
+	.set_rx_decap			= &dr_ste_v3_set_rx_decap,
+	.set_encap_l3			= &dr_ste_v3_set_encap_l3,
+	/* Send */
+	.prepare_for_postsend		= &dr_ste_v1_prepare_for_postsend,
+};
+
+struct mlx5dr_ste_ctx *mlx5dr_ste_get_ctx_v3(void)
+{
+	return &ste_ctx_v3;
+}
diff --git a/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/mlx5_ifc_dr.h b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/mlx5_ifc_dr.h
index fb078fa0f0cc..898c3618ff26 100644
--- a/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/mlx5_ifc_dr.h
+++ b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/mlx5_ifc_dr.h
@@ -600,4 +600,44 @@ struct mlx5_ifc_ste_double_action_aso_v1_bits {
 	};
 };
 
+struct mlx5_ifc_ste_single_action_remove_header_v3_bits {
+	u8         action_id[0x8];
+	u8         start_anchor[0x7];
+	u8         end_anchor[0x7];
+	u8         reserved_at_16[0x1];
+	u8         outer_l4_remove[0x1];
+	u8         reserved_at_18[0x4];
+	u8         decap[0x1];
+	u8         vni_to_cqe[0x1];
+	u8         qos_profile[0x2];
+};
+
+struct mlx5_ifc_ste_single_action_remove_header_size_v3_bits {
+	u8         action_id[0x8];
+	u8         start_anchor[0x7];
+	u8         start_offset[0x8];
+	u8         outer_l4_remove[0x1];
+	u8         reserved_at_18[0x2];
+	u8         remove_size[0x6];
+};
+
+struct mlx5_ifc_ste_double_action_insert_with_inline_v3_bits {
+	u8         action_id[0x8];
+	u8         start_anchor[0x7];
+	u8         start_offset[0x8];
+	u8         reserved_at_17[0x9];
+
+	u8         inline_data[0x20];
+};
+
+struct mlx5_ifc_ste_double_action_insert_with_ptr_v3_bits {
+	u8         action_id[0x8];
+	u8         start_anchor[0x7];
+	u8         start_offset[0x8];
+	u8         size[0x6];
+	u8         attributes[0x3];
+
+	u8         pointer[0x20];
+};
+
 #endif /* MLX5_IFC_DR_H */
diff --git a/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/mlx5dr.h b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/mlx5dr.h
index 3ac7dc67509f..0bb3724c10c2 100644
--- a/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/mlx5dr.h
+++ b/drivers/net/ethernet/mellanox/mlx5/core/steering/sws/mlx5dr.h
@@ -160,7 +160,7 @@ mlx5dr_is_supported(struct mlx5_core_dev *dev)
 	       (MLX5_CAP_ESW_FLOWTABLE_FDB(dev, sw_owner) ||
 		(MLX5_CAP_ESW_FLOWTABLE_FDB(dev, sw_owner_v2) &&
 		 (MLX5_CAP_GEN(dev, steering_format_version) <=
-		  MLX5_STEERING_FORMAT_CONNECTX_7)));
+		  MLX5_STEERING_FORMAT_CONNECTX_8)));
 }
 
 /* buddy functions & structure */
