diff --git a/crates/net/network/src/session/mod.rs b/crates/net/network/src/session/mod.rs
index cdcf95b5f7..68725f2ba1 100644
--- a/crates/net/network/src/session/mod.rs
+++ b/crates/net/network/src/session/mod.rs
@@ -837,6 +837,9 @@ async fn authenticate_stream(
     };
 
     // if the hello handshake was successful we can try status handshake
+    //
+    // Before trying status handshake, set up the version to shared_capability
+    let status = Status { version: p2p_stream.shared_capability().version(), ..status };
     let eth_unauthed = UnauthedEthStream::new(p2p_stream);
     let (eth_stream, their_status) = match eth_unauthed.handshake(status, fork_filter).await {
         Ok(stream_res) => stream_res,
diff --git a/crates/net/network/src/test_utils/testnet.rs b/crates/net/network/src/test_utils/testnet.rs
index 3834fb8e93..06697dfb6f 100644
--- a/crates/net/network/src/test_utils/testnet.rs
+++ b/crates/net/network/src/test_utils/testnet.rs
@@ -6,7 +6,7 @@ use crate::{
 };
 use futures::{FutureExt, StreamExt};
 use pin_project::pin_project;
-use reth_eth_wire::DisconnectReason;
+use reth_eth_wire::{capability::Capability, DisconnectReason, HelloBuilder};
 use reth_primitives::PeerId;
 use reth_provider::{test_utils::NoopProvider, BlockProvider, HeaderProvider};
 use secp256k1::SecretKey;
@@ -281,17 +281,33 @@ where
     /// to any available IP and port.
     pub fn new(client: Arc<C>) -> Self {
         let secret_key = SecretKey::new(&mut rand::thread_rng());
-        Self::with_secret_key(client, secret_key)
+        let config = Self::network_config_builder(secret_key).build(Arc::clone(&client));
+        Self { config, client, secret_key }
     }
 
     /// Initialize the network with a given secret key, allowing devp2p and discovery to bind any
     /// available IP and port.
     pub fn with_secret_key(client: Arc<C>, secret_key: SecretKey) -> Self {
-        let config = NetworkConfigBuilder::new(secret_key)
+        let config = Self::network_config_builder(secret_key).build(Arc::clone(&client));
+        Self { config, client, secret_key }
+    }
+
+    /// Initialize the network with a given capabilities.
+    pub fn with_capabilities(client: Arc<C>, capabilities: Vec<Capability>) -> Self {
+        let secret_key = SecretKey::new(&mut rand::thread_rng());
+
+        let builder = Self::network_config_builder(secret_key);
+        let hello_message =
+            HelloBuilder::new(builder.get_peer_id()).capabilities(capabilities).build();
+        let config = builder.hello_message(hello_message).build(Arc::clone(&client));
+
+        Self { config, client, secret_key }
+    }
+
+    fn network_config_builder(secret_key: SecretKey) -> NetworkConfigBuilder {
+        NetworkConfigBuilder::new(secret_key)
             .listener_addr(SocketAddr::V4(SocketAddrV4::new(Ipv4Addr::UNSPECIFIED, 0)))
             .discovery_addr(SocketAddr::V4(SocketAddrV4::new(Ipv4Addr::UNSPECIFIED, 0)))
-            .build(Arc::clone(&client));
-        Self { config, client, secret_key }
     }
 }
 
diff --git a/crates/net/network/tests/it/main.rs b/crates/net/network/tests/it/main.rs
index e52017ac74..87fbbfb96b 100644
--- a/crates/net/network/tests/it/main.rs
+++ b/crates/net/network/tests/it/main.rs
@@ -1,4 +1,5 @@
 mod connect;
 mod requests;
+mod session;
 
 fn main() {}
diff --git a/crates/net/network/tests/it/session.rs b/crates/net/network/tests/it/session.rs
new file mode 100644
index 0000000000..56ff3616d2
--- /dev/null
+++ b/crates/net/network/tests/it/session.rs
@@ -0,0 +1,87 @@
+//! Session tests
+
+use futures::StreamExt;
+use reth_eth_wire::{capability::Capability, EthVersion};
+use reth_network::{
+    test_utils::{PeerConfig, Testnet},
+    NetworkEvent,
+};
+use reth_network_api::{NetworkInfo, Peers};
+use reth_provider::test_utils::NoopProvider;
+use std::sync::Arc;
+
+#[tokio::test(flavor = "multi_thread")]
+async fn test_session_established_with_highest_version() {
+    reth_tracing::init_test_tracing();
+
+    let net = Testnet::create(2).await;
+
+    net.for_each(|peer| assert_eq!(0, peer.num_peers()));
+
+    let mut handles = net.handles();
+    let handle0 = handles.next().unwrap();
+    let handle1 = handles.next().unwrap();
+    drop(handles);
+
+    let handle = net.spawn();
+
+    handle0.add_peer(*handle1.peer_id(), handle1.local_addr());
+
+    let mut events = handle0.event_listener().take(2);
+    while let Some(event) = events.next().await {
+        match event {
+            NetworkEvent::PeerAdded(peer_id) => {
+                assert_eq!(handle1.peer_id(), &peer_id);
+            }
+            NetworkEvent::SessionEstablished { peer_id, status, .. } => {
+                assert_eq!(handle1.peer_id(), &peer_id);
+                assert_eq!(status.version, EthVersion::Eth67 as u8);
+            }
+            _ => {
+                panic!("unexpected event")
+            }
+        }
+    }
+
+    handle.terminate().await;
+}
+
+#[tokio::test(flavor = "multi_thread")]
+async fn test_session_established_with_different_capability() {
+    reth_tracing::init_test_tracing();
+
+    let mut net = Testnet::create(1).await;
+
+    let capabilities = vec![Capability::new("eth".into(), EthVersion::Eth66 as usize)];
+    let p1 = PeerConfig::with_capabilities(Arc::new(NoopProvider::default()), capabilities);
+    net.add_peer_with_config(p1).await.unwrap();
+
+    net.for_each(|peer| assert_eq!(0, peer.num_peers()));
+
+    let mut handles = net.handles();
+    let handle0 = handles.next().unwrap();
+    let handle1 = handles.next().unwrap();
+    drop(handles);
+
+    let handle = net.spawn();
+
+    handle0.add_peer(*handle1.peer_id(), handle1.local_addr());
+
+    let mut events = handle0.event_listener().take(2);
+    while let Some(event) = events.next().await {
+        match event {
+            NetworkEvent::PeerAdded(peer_id) => {
+                assert_eq!(handle1.peer_id(), &peer_id);
+            }
+            NetworkEvent::SessionEstablished { peer_id, status, .. } => {
+                assert_eq!(handle1.peer_id(), &peer_id);
+                assert_eq!(status.version, EthVersion::Eth66 as u8);
+            }
+            _ => {
+                panic!("unexpected event")
+            }
+        }
+    }
+
+    handle.terminate().await;
+}