diff --git a/instrumentation/action_pack/lib/opentelemetry/instrumentation/action_pack/instrumentation.rb b/instrumentation/action_pack/lib/opentelemetry/instrumentation/action_pack/instrumentation.rb
index cad8a14a46..d5e1908acf 100644
--- a/instrumentation/action_pack/lib/opentelemetry/instrumentation/action_pack/instrumentation.rb
+++ b/instrumentation/action_pack/lib/opentelemetry/instrumentation/action_pack/instrumentation.rb
@@ -33,10 +33,12 @@ def gem_version
 
         def patch
           Handlers.subscribe
+          ActionController::Live.include(Patches::ActionController::Live)
         end
 
         def require_dependencies
           require_relative 'handlers'
+          require_relative 'patches/action_controller/live'
         end
 
         def require_railtie
diff --git a/instrumentation/action_pack/lib/opentelemetry/instrumentation/action_pack/patches/action_controller/live.rb b/instrumentation/action_pack/lib/opentelemetry/instrumentation/action_pack/patches/action_controller/live.rb
new file mode 100644
index 0000000000..30dc721476
--- /dev/null
+++ b/instrumentation/action_pack/lib/opentelemetry/instrumentation/action_pack/patches/action_controller/live.rb
@@ -0,0 +1,36 @@
+# frozen_string_literal: true
+
+# Copyright The OpenTelemetry Authors
+#
+# SPDX-License-Identifier: Apache-2.0
+
+module OpenTelemetry
+  module Instrumentation
+    module ActionPack
+      module Patches
+        module ActionController
+          # Module to append to ActionController::Live for instrumentation
+          module Live
+            def process_action(*)
+              current_context = OpenTelemetry::Context.current
+
+              # Unset thread local to avoid modifying stack array shared with parent thread
+              Thread.current[:__opentelemetry_context_storage__] = nil
+
+              attributes = {
+                OpenTelemetry::SemanticConventions::Trace::CODE_NAMESPACE => self.class.name,
+                OpenTelemetry::SemanticConventions::Trace::CODE_FUNCTION => action_name
+              }
+
+              OpenTelemetry::Context.with_current(current_context) do
+                Instrumentation.instance.tracer.in_span("#{self.class.name}##{action_name}", attributes: attributes) do
+                  super
+                end
+              end
+            end
+          end
+        end
+      end
+    end
+  end
+end
diff --git a/instrumentation/action_pack/test/opentelemetry/instrumentation/action_pack/patches/action_controller/live_test.rb b/instrumentation/action_pack/test/opentelemetry/instrumentation/action_pack/patches/action_controller/live_test.rb
new file mode 100644
index 0000000000..0942d492ed
--- /dev/null
+++ b/instrumentation/action_pack/test/opentelemetry/instrumentation/action_pack/patches/action_controller/live_test.rb
@@ -0,0 +1,53 @@
+# frozen_string_literal: true
+
+# Copyright The OpenTelemetry Authors
+#
+# SPDX-License-Identifier: Apache-2.0
+
+require 'test_helper'
+
+describe OpenTelemetry::Instrumentation::ActionPack::Patches::ActionController::Live do
+  include Rack::Test::Methods
+
+  let(:instrumentation) { OpenTelemetry::Instrumentation::ActionPack::Instrumentation.instance }
+  let(:exporter) { EXPORTER }
+  let(:spans) { exporter.finished_spans }
+  let(:span) { exporter.finished_spans.last }
+  let(:rails_app) { DEFAULT_RAILS_APP }
+  let(:config) { {} }
+
+  # Clear captured spans
+  before do
+    OpenTelemetry::Instrumentation::ActionPack::Handlers.unsubscribe
+
+    instrumentation.instance_variable_set(:@config, config)
+    instrumentation.instance_variable_set(:@installed, false)
+
+    instrumentation.install(config)
+
+    exporter.reset
+  end
+
+  it 'creates a child span for the new thread' do
+    get '/stream'
+
+    parent_span = spans[-2]
+
+    _(last_response.ok?).must_equal true
+    _(span.name).must_equal 'ExampleLiveController#stream'
+    _(span.kind).must_equal :internal
+    _(span.status.ok?).must_equal true
+
+    _(span.instrumentation_library.name).must_equal 'OpenTelemetry::Instrumentation::ActionPack'
+    _(span.instrumentation_library.version).must_equal OpenTelemetry::Instrumentation::ActionPack::VERSION
+
+    _(span.attributes['code.namespace']).must_equal 'ExampleLiveController'
+    _(span.attributes['code.function']).must_equal 'stream'
+
+    _(span.parent_span_id).must_equal parent_span.span_id
+  end
+
+  def app
+    rails_app
+  end
+end
diff --git a/instrumentation/action_pack/test/test_helpers/controllers.rb b/instrumentation/action_pack/test/test_helpers/controllers.rb
index 1f58e148f2..03cf03294c 100644
--- a/instrumentation/action_pack/test/test_helpers/controllers.rb
+++ b/instrumentation/action_pack/test/test_helpers/controllers.rb
@@ -5,4 +5,5 @@
 # SPDX-License-Identifier: Apache-2.0
 
 require_relative 'controllers/example_controller'
+require_relative 'controllers/example_live_controller'
 require_relative 'controllers/exceptions_controller'
diff --git a/instrumentation/action_pack/test/test_helpers/controllers/example_live_controller.rb b/instrumentation/action_pack/test/test_helpers/controllers/example_live_controller.rb
new file mode 100644
index 0000000000..046b61d468
--- /dev/null
+++ b/instrumentation/action_pack/test/test_helpers/controllers/example_live_controller.rb
@@ -0,0 +1,19 @@
+# frozen_string_literal: true
+
+# Copyright The OpenTelemetry Authors
+#
+# SPDX-License-Identifier: Apache-2.0
+
+class ExampleLiveController < ActionController::Base
+  include ActionController::Live
+
+  def stream
+    response.headers['Content-Type'] = 'text/event-stream'
+    10.times do
+      response.stream.write "hello world\n"
+      sleep 0.1
+    end
+  ensure
+    response.stream.close
+  end
+end
diff --git a/instrumentation/action_pack/test/test_helpers/routes.rb b/instrumentation/action_pack/test/test_helpers/routes.rb
index 07d72708d4..e263b7f67e 100644
--- a/instrumentation/action_pack/test/test_helpers/routes.rb
+++ b/instrumentation/action_pack/test/test_helpers/routes.rb
@@ -11,5 +11,6 @@ def draw_routes(rails_app)
     get '/items/new', to: 'example#new_item'
     get '/items/:id', to: 'example#item'
     get '/internal_server_error', to: 'example#internal_server_error'
+    get '/stream', to: 'example_live#stream'
   end
 end