diff --git a/ci-operator/step-registry/cucushift/upgrade/check/capability/OWNERS b/ci-operator/step-registry/cucushift/upgrade/check/capability/OWNERS
new file mode 100644
index 0000000000000..0bb8d7a3f3c72
--- /dev/null
+++ b/ci-operator/step-registry/cucushift/upgrade/check/capability/OWNERS
@@ -0,0 +1,12 @@
+approvers:
+- jianlinliu
+- jiajliu
+- shellyyang1989
+- evakhoni
+- JianLi-RH
+reviewers:
+- jianlinliu
+- jiajliu
+- shellyyang1989
+- evakhoni
+- JianLi-RH
diff --git a/ci-operator/step-registry/cucushift/upgrade/check/capability/cucushift-upgrade-check-capability-commands.sh b/ci-operator/step-registry/cucushift/upgrade/check/capability/cucushift-upgrade-check-capability-commands.sh
new file mode 100644
index 0000000000000..72acb344f5b38
--- /dev/null
+++ b/ci-operator/step-registry/cucushift/upgrade/check/capability/cucushift-upgrade-check-capability-commands.sh
@@ -0,0 +1,451 @@
+#!/bin/bash
+
+set -o nounset
+set -o errexit
+set -o pipefail
+
+trap 'FRC=$?; create_postupgrade_junit' EXIT TERM
+
+# Generate the Junit for cap check
+function create_postupgrade_junit() {
+    echo "Generating the Junit for post upgrade check on capability"
+    filename="cluster upgrade"
+    testsuite="cluster upgrade"
+    subteam="OTA"
+    if (( FRC == 0 )); then
+        cat >"${ARTIFACT_DIR}/${filename}.xml" <<EOF
+<?xml version="1.0" encoding="UTF-8"?>
+<testsuite name="${testsuite}" failures="0" errors="0" skipped="0" tests="1" time="1">
+  <testcase name="${subteam}:Post upgrade check on capability should succeed or skip"/>
+</testsuite>
+EOF
+    else
+        cat >"${ARTIFACT_DIR}/${filename}.xml" <<EOF
+<?xml version="1.0" encoding="UTF-8"?>
+<testsuite name="${testsuite}" failures="1" errors="0" skipped="0" tests="1" time="1">
+  <testcase name="${subteam}:Post upgrade check on capability should succeed">
+    <failure message="">Post upgrade check on capability failed</failure>
+  </testcase>
+</testsuite>
+EOF
+    fi
+}
+
+baselinecaps_from_cluster=$(oc get clusterversion version -ojson | jq -r '.spec.capabilities.baselineCapabilitySet')
+if [[ "${baselinecaps_from_cluster}" == "" ]]; then
+    echo "spec.capabilities.baselineCapabilitySet is not set, skip the check!"
+    exit 0
+fi
+echo "baselinecaps_from_cluster: ${baselinecaps_from_cluster}"
+
+# Get capabilities string based on release version and capset
+# Need update when new cap set pops up
+function get_caps_for_version_capset() {
+    local version=$1
+    local cap_index=$2
+
+    if [ -z "${version}" ] || [ -z "${cap_index}" ]; then
+        echo "ERROR: Missing required arguments"
+        return 1
+    fi
+
+    major_version=$( echo "${version}" | cut -f1 -d. )
+    minor_version=$( echo "${version}" | cut -f2 -d. )
+    if [[ "${cap_index}" == "vCurrent" ]]; then
+        cap_index="v${major_version}.${minor_version}"
+    fi
+
+    local caps_string=""
+    case ${cap_index} in
+    "None")
+    ;;
+    "v4.11")
+    caps_string="baremetal marketplace openshift-samples"   
+    (( minor_version >=14 && major_version == 4 )) && caps_string="${caps_string} MachineAPI"
+    ;;
+    "v4.12")
+    caps_string="baremetal marketplace openshift-samples Console Insights Storage CSISnapshot"
+    (( minor_version >=14 && major_version == 4 )) && caps_string="${caps_string} MachineAPI"
+    ;;
+    "v4.13")
+    caps_string="baremetal marketplace openshift-samples Console Insights Storage CSISnapshot NodeTuning"
+    (( minor_version >=14 && major_version == 4 )) && caps_string="${caps_string} MachineAPI"
+    ;;
+    "v4.14")
+    caps_string="baremetal marketplace openshift-samples Console Insights Storage CSISnapshot NodeTuning MachineAPI Build DeploymentConfig ImageRegistry"
+    ;;
+    "v4.15")
+    caps_string="baremetal marketplace openshift-samples Console Insights Storage CSISnapshot NodeTuning MachineAPI Build DeploymentConfig ImageRegistry OperatorLifecycleManager"
+    ;;
+    *)
+    caps_string="baremetal marketplace openshift-samples Console Insights Storage CSISnapshot NodeTuning MachineAPI Build DeploymentConfig ImageRegistry OperatorLifecycleManager"
+    ;;
+    esac
+
+    echo $caps_string
+}
+
+# Extract manifests from release
+function extract_manifests() {
+    # echo "Extracing manifests..."
+    local work_dir="$1"
+    local release="$2"
+    #local tmp_known_caps
+
+    # Check if the directory exists
+    if [ ! -d "${work_dir}" ] || [ -z "${release}" ]; then
+        echo "ERROR: Missing required arguments"
+        return 1
+    fi
+
+    # Extract manifests
+    if ! oc adm release extract -a "${CLUSTER_PROFILE_DIR}/pull-secret" --to ${work_dir} --from ${release}; then
+        echo "ERROR: Extracting manifest failed"
+        return 1
+    fi
+}
+
+# Get implicitly enabled capabilities from cluster
+function get_actual_implicit_caps {
+    # echo "Getting actual implicitly enabled caps in cluster..."
+    local tmp_capabilities implicit_status implicit_message
+    # Obtain ImplicitlyEnabledCapabilities condition status from cluster
+    if ! implicit_status=$(oc get clusterversion version -o json | jq -r '.status.conditions[] | select(.type == "ImplicitlyEnabledCapabilities").status'); then
+        echo "ERROR: Get implicitly enabled caps failed"
+        return 1
+    fi
+    if [ "$implicit_status" = "False" ]; then
+        echo "INFO: No implicitly enabled capabilities in the cluster"
+        return
+    fi
+    # Obtain ImplicitlyEnabledCapabilities condition message from cluster
+    if ! implicit_message=$(oc get clusterversion version -o json | jq -r '.status.conditions[] | select(.type == "ImplicitlyEnabledCapabilities").message'); then
+        echo "ERROR: Get implicitly enabled caps failed"
+        return 1
+    fi
+
+    # Parse the message to extract implicit caps
+    # The condition message could be "The following capabilities could not be disabled: Console, Insights, Storage"
+    tmp_capabilities=$(echo "$implicit_message" | grep -oE 'could not be disabled: (.*)' | cut -d':' -f2)
+    actual_implicit_caps=$(echo "$tmp_capabilities" | awk -F', ' '{ for (i=1; i<=NF; i++) print $i }')
+    # echo "Actual implicitly enabled capabilities list is ${actual_implicit_caps}"
+}
+
+# Get new capabilities introduced in target release compared to source release
+# It doesn't take migrated caps into account
+function get_new_caps() {
+    # echo "Getting new caps introduced in target release as compared to source release..."
+    local source="$1"
+    local target="$2"
+    local array_source array_target extra_caps
+
+    # Check for missing environment variables
+    if [ -z "$source" ] || [ -z "$target" ]; then
+        echo "ERROR: Missing required arguments"
+        return 1
+    fi
+
+    # Split the elements into arrays
+    IFS=" " read -ra array_source <<< "${source}"
+    IFS=" " read -ra array_target <<< "${target}"
+
+    # Find the extra elements in $target compared to $source
+    extra_caps=()
+    for cap in "${array_target[@]}"; do
+        #shellcheck disable=SC2076
+        if [[ ! " ${array_source[*]} " =~ " ${cap} " ]]; then
+            extra_caps+=("$cap")
+        fi
+    done
+
+    # Combine the extra elements into a space-separated string
+    echo "${extra_caps[*]}"
+    #echo "Expected implicitly enabled capabilities list is ${expected_implicit_caps}"
+}
+
+# compares two payloads for capabilities difference at manifest level
+function extract_migrated_caps() {
+    echo "Extracting migrated caps between 2 releases..."
+    local source="$1"
+    local target="$2"
+    local source_dir target_dir source_cap_files
+
+    # Check for missing environment variables
+    if [ -z "$source" ] || [ -z "$target" ]; then
+        echo "ERROR: Missing required arguments"
+        return 1
+    fi
+
+    source_dir="/tmp/source"
+    target_dir="/tmp/target"
+    mkdir -p ${source_dir} ${target_dir}
+
+    if ! extract_manifests "${source_dir}" "${source}" || ! extract_manifests "${target_dir}" "${target}"; then
+        return 1
+    fi
+
+    source_cap_files=$(grep -rl "capability.openshift.io/name" ${source_dir})
+    for source_file in ${source_cap_files}; do
+        filename=$(basename "${source_file}")
+        target_file="$target_dir/$filename"
+
+        if [ -f "$target_file" ]; then
+            source_cap=$(grep 'capability.openshift.io/name:' "$source_file" | cut -d ':' -f2 | tr -d '"' | sort | uniq )
+            target_cap=$(grep 'capability.openshift.io/name:' "$target_file" | cut -d ':' -f2 | tr -d '"' | sort | uniq )
+
+            if [ "$source_cap" != "$target_cap" ]; then
+                echo "Migrated capability in $filename: $source_cap -> $target_cap"
+                migrated_caps["$source_cap"]=$target_cap
+            fi
+        fi
+    done
+}
+
+function check_cvo_cap() {
+
+    local result=0
+    local capability_set=$1
+    local expected_status=$2
+    local cvo_field=$3
+
+    cvo_caps=$(oc get clusterversion version -o json | jq -rc "${cvo_field}")
+    if [[ "${capability_set}" == "" ]] && [[ "${cvo_caps}" != "null" ]]; then
+        echo "ERROR: ${expected_status} capability set is empty, but find capabilities ${cvo_caps} in cvo ${cvo_field}"
+        result=1
+    fi
+    if [[ "${capability_set}" != "" ]]; then
+        if [[ "${cvo_caps}" == "null" ]]; then
+            echo "ERROR: ${expected_status} capability set are ${capability_set}, but it's empty in cvo ${cvo_field}"
+            result=1
+        else
+            cvo_caps_str=$(echo $cvo_caps | tr -d '["]' | tr "," " " | xargs -n1 | sort -u | xargs)
+            if [[ "${cvo_caps_str}" == "${capability_set}" ]]; then
+                echo "INFO: ${expected_status} capabilities matches with cvo ${cvo_field}!"
+                echo -e "cvo_caps: ${cvo_caps_str}\n${expected_status} capability set: ${capability_set}"
+            else
+                echo "ERROR: ${expected_status} capabilities does not match with cvo ${cvo_field}!"
+                echo -e "cvo_caps: ${cvo_caps_str}\n${expected_status} capability set: ${capability_set}"
+                echo "diff [cvo_caps] [${expected_status} capability set]"
+                diff <( echo $cvo_caps_str | tr " " "\n" | sort | uniq) <( echo $capability_set | tr " " "\n" | sort | uniq )
+                result=1
+            fi
+        fi
+    fi
+
+    return $result
+} >&2
+
+if [ -f "${SHARED_DIR}/kubeconfig" ] ; then
+    export KUBECONFIG=${SHARED_DIR}/kubeconfig
+else
+    echo "Unable to find kubeconfig under ${SHARED_DIR}!"
+    exit 1
+fi
+
+# Setup proxy if it's present in the shared dir
+if [[ -f "${SHARED_DIR}/proxy-conf.sh" ]]; then
+    # shellcheck disable=SC1091
+    source "${SHARED_DIR}/proxy-conf.sh"
+fi
+# shellcheck disable=SC2207
+version_set=($(oc get clusterversion version -ojson | jq -r .status.history[].version))
+
+# Mapping between optional capability and operators
+# Need update when new operator marks as optional
+declare -A caps_operator
+caps_operator[baremetal]="baremetal"
+caps_operator[marketplace]="marketplace"
+caps_operator[openshift-samples]="openshift-samples"
+caps_operator[CSISnapshot]="csi-snapshot-controller"
+caps_operator[Console]="console"
+caps_operator[Insights]="insights"
+caps_operator[Storage]="storage"
+caps_operator[NodeTuning]="node-tuning"
+caps_operator[MachineAPI]="machine-api control-plane-machine-set cluster-autoscaler"
+caps_operator[ImageRegistry]="image-registry"
+caps_operator[OperatorLifecycleManager]="operator-lifecycle-manager operator-lifecycle-manager-catalog operator-lifecycle-manager-packageserver"
+
+# Mapping between optional capability and resources
+# Need update when new resource marks as optional
+caps_resource_list="Build DeploymentConfig"
+declare -A caps_resource
+caps_resource[Build]="builds buildconfigs"
+caps_resource[DeploymentConfig]="deploymentconfigs"
+
+# Initialize the variables
+declare -A migrated_caps=()
+if ! extract_migrated_caps "${version_set[-1]}" "${version_set[0]}"; then
+    echo "ERROR: extract_migrated_caps failed" && exit 1
+fi
+
+expected_enabled_caps=""
+expected_implicit_caps=""
+expected_disabled_caps=""
+
+source_baseline_caps=$(get_caps_for_version_capset "${version_set[-1]}" "${baselinecaps_from_cluster}")
+target_baseline_caps=$(get_caps_for_version_capset "${version_set[0]}" "${baselinecaps_from_cluster}")
+
+source_known_caps=$(get_caps_for_version_capset "${version_set[-1]}" "vCurrent")
+target_known_caps=$(get_caps_for_version_capset "${version_set[0]}" "vCurrent")
+
+new_caps=$(get_new_caps "${source_known_caps}" "${target_known_caps}")
+
+additionalcaps_from_cluster=$(oc get clusterversion version -ojson | jq -r 'if .spec.capabilities.additionalEnabledCapabilities then .spec.capabilities.additionalEnabledCapabilities[] else empty end')
+
+echo -e "\nsource_baseline_caps is ${source_baseline_caps}\
+\ntarget_baseline_caps is ${target_baseline_caps}\
+\nsource_known_caps is ${source_known_caps}\ntarget_known_caps is ${target_known_caps}\
+\nnew_caps is ${new_caps}\nadditionalcaps_from_cluster is ${additionalcaps_from_cluster}"
+
+# vCurrent baseline set should grow new caps of target version explicitly after upgrade
+if [[ "${baselinecaps_from_cluster}" == "vCurrent" ]]; then
+    expected_enabled_caps="${additionalcaps_from_cluster} ${target_baseline_caps}"
+fi
+
+# v4.x baseline set should grow new caps in v4.x of target version explicitly after upgrade
+# v4.x baseline set should grow new caps in target version implicitly
+# v4.x baseline set should grow new caps implicitly after upgrade if cap migrates to a cap out of v4.x & additional caps of target version
+if [[ "${baselinecaps_from_cluster}" == "v4."* ]]; then
+    source_enabled_caps="${source_baseline_caps} ${additionalcaps_from_cluster}"
+    target_enabled_caps="${target_baseline_caps} ${additionalcaps_from_cluster}"
+    expected_enabled_caps="${target_enabled_caps}"
+    
+    expected_enabled_caps="${expected_enabled_caps} ${new_caps}"
+    expected_implicit_caps="${expected_implicit_caps} ${new_caps}"
+
+    if [ ${#migrated_caps[@]} -eq 0 ]; then
+        echo "migrated_caps is empty."
+    else
+        echo "migrated_caps is not empty."
+        for key in "${!migrated_caps[@]}"; do
+            if [[ $source_enabled_caps == *$key* ]] && [[ $target_enabled_caps != *${migrated_caps[$key]}* ]]; then
+                expected_enabled_caps="${expected_enabled_caps} ${migrated_caps[$key]}"
+                expected_implicit_caps="${expected_implicit_caps} ${migrated_caps[$key]}"
+            fi
+        done
+    fi
+fi
+
+# None baseline set should grow new caps of target version implicitly after upgrade
+# None baseline set should grow new caps if caps migrate to someones that are not in additional caps
+if [[ "${baselinecaps_from_cluster}" == "None" ]]; then
+    expected_enabled_caps="${additionalcaps_from_cluster}"
+    expected_enabled_caps="${expected_enabled_caps} ${new_caps}"
+    expected_implicit_caps="${expected_implicit_caps} ${new_caps}"
+
+    if [ ${#migrated_caps[@]} -eq 0 ]; then
+        echo "migrated_caps is empty."
+    else
+        echo "migrated_caps is not empty."
+        for key in "${!migrated_caps[@]}"; do
+            if [[ ${additionalcaps_from_cluster} == *$key* ]] && [[ ${additionalcaps_from_cluster} != *${migrated_caps[$key]}* ]]; then
+                expected_enabled_caps="${expected_enabled_caps} ${migrated_caps[$key]}"
+                expected_implicit_caps="${expected_implicit_caps} ${migrated_caps[$key]}"
+            fi
+        done
+    fi
+fi
+
+actual_implicit_caps=""
+if ! get_actual_implicit_caps; then
+    echo "ERROR: get_actual_implicit_caps failed" && exit 1
+fi
+
+actual_implicit_caps=$(echo ${actual_implicit_caps} | xargs -n1 | sort -u | xargs)
+expected_implicit_caps=$(echo ${expected_implicit_caps} | xargs -n1 | sort -u | xargs)
+expected_enabled_caps=$(echo ${expected_enabled_caps} | xargs -n1 | sort -u | xargs)
+expected_disabled_caps="${target_known_caps}"
+for cap in $expected_enabled_caps; do
+    expected_disabled_caps=${expected_disabled_caps/$cap}
+done
+expected_disabled_caps=$(echo ${expected_disabled_caps} | xargs -n1 | sort -u | xargs)
+
+echo -e "\nactual_implicit_caps is ${actual_implicit_caps}\
+\nexpected_enabled_caps is ${expected_enabled_caps}\
+\nexpected_implicit_caps is ${expected_implicit_caps}\
+\nexpected_disabled_caps is ${expected_disabled_caps}"
+
+# Overall check result
+check_result=0
+
+# Check if Implicitly enabled caps are correct
+echo "------check .status.conditions.ImplicitlyEnabledCapabilities------"
+echo -e "actual_implicit_caps: ${actual_implicit_caps}\nexpected_implicit_caps: ${expected_implicit_caps}"
+if [[ "${actual_implicit_caps}" == "${expected_implicit_caps}" ]]; then
+    echo "INFO: Actual implicitly enabled capabilities match expected implicitly enabled capabilities"   
+else
+    echo "ERROR: Actual implicitly enabled capabilities don't match expected implicitly enabled capabilities"
+    check_result=1
+fi
+
+# Check if cvo status.capabilities correct
+echo "------check cvo status capabilities check-----"
+echo "===check .status.capabilities.enabledCapabilities"
+check_cvo_cap "${expected_enabled_caps}" "enabled" ".status.capabilities.enabledCapabilities" || check_result=1
+
+echo "===check .status.capabilities.knownCapabilities"
+vcurrent_str=$(echo "${target_known_caps}" | xargs -n1 | sort -u | xargs)
+check_cvo_cap "${vcurrent_str}" "known" ".status.capabilities.knownCapabilities" || check_result=1
+
+echo "------cluster operators------"
+co_content=$(mktemp)
+oc get co | tee ${co_content}
+
+# Check if the resources of enabled capabilities exist in the cluster
+echo "------check enabled capabilities-----"
+echo "enabled capability set: ${expected_enabled_caps}"
+for cap in $expected_enabled_caps; do
+    echo "check capability ${cap}"
+    #shellcheck disable=SC2076
+    if [[ " ${caps_resource_list} " =~ " ${cap} " ]]; then
+        resource="${caps_resource[$cap]}"
+        res_ret=0
+        for r in ${resource}; do
+            oc api-resources | grep ${r} || res_ret=1
+        done
+        if [[ ${res_ret} -eq 1 ]] ; then
+            echo "ERROR: capability ${cap}: resources ${resource} -- not found!"
+            check_result=1
+        fi
+        continue
+    fi
+    for op in ${caps_operator[$cap]}; do
+        if [[ ! `grep -e "^${op} " ${co_content}` ]]; then
+            echo "ERROR: capability ${cap}: operator ${op} -- not found!"
+            check_result=1
+        fi
+    done
+done
+
+# Check if the resources of disabled capabilities not exist in the cluster
+echo "------check disabled capabilities-----"
+echo "disabled capability set: ${expected_disabled_caps}"
+for cap in $expected_disabled_caps; do
+    echo "check capability ${cap}"
+    #shellcheck disable=SC2076
+    if [[ " ${caps_resource_list} " =~ " ${cap} " ]]; then
+        resource="${caps_resource[$cap]}"
+        res_ret=0
+        for r in ${resource}; do
+            oc api-resources | grep ${r} || res_ret=1
+        done
+        if [[ ${res_ret} -eq 0 ]]; then
+            echo "ERROR: capability ${cap}: resources ${resource} -- found!"
+            check_result=1
+        fi
+        continue
+    fi
+    for op in ${caps_operator[$cap]}; do
+        if [[ `grep -e "^${op} " ${co_content}` ]]; then
+            echo "ERROR: capability ${cap}: operator ${op} -- found"
+            check_result=1
+        fi
+    done
+done
+
+if [[ ${check_result} == 1 ]]; then
+    echo -e "\nCapability check result -- FAILED, please check above details!"
+    exit 1
+else
+    echo -e "\nCapability check result -- PASSED!"
+fi
diff --git a/ci-operator/step-registry/cucushift/upgrade/check/capability/cucushift-upgrade-check-capability-ref.metadata.json b/ci-operator/step-registry/cucushift/upgrade/check/capability/cucushift-upgrade-check-capability-ref.metadata.json
new file mode 100644
index 0000000000000..66695718ce046
--- /dev/null
+++ b/ci-operator/step-registry/cucushift/upgrade/check/capability/cucushift-upgrade-check-capability-ref.metadata.json
@@ -0,0 +1,19 @@
+{
+	"path": "cucushift/upgrade/check/capability/cucushift-upgrade-check-capability-ref.yaml",
+	"owners": {
+		"approvers": [
+			"jianlinliu",
+			"jiajliu",
+			"shellyyang1989",
+			"evakhoni",
+			"JianLi-RH"
+		],
+		"reviewers": [
+			"jianlinliu",
+			"jiajliu",
+			"shellyyang1989",
+			"evakhoni",
+			"JianLi-RH"
+		]
+	}
+}
\ No newline at end of file
diff --git a/ci-operator/step-registry/cucushift/upgrade/check/capability/cucushift-upgrade-check-capability-ref.yaml b/ci-operator/step-registry/cucushift/upgrade/check/capability/cucushift-upgrade-check-capability-ref.yaml
new file mode 100644
index 0000000000000..cdbe93b5ba013
--- /dev/null
+++ b/ci-operator/step-registry/cucushift/upgrade/check/capability/cucushift-upgrade-check-capability-ref.yaml
@@ -0,0 +1,21 @@
+ref:
+  as: cucushift-upgrade-check-capability
+  from_image:
+    namespace: ocp
+    name: "4.12"
+    tag: upi-installer
+  cli: latest
+  timeout: 22h
+  grace_period: 10m
+  commands: cucushift-upgrade-check-capability-commands.sh
+  resources:
+    requests:
+      cpu: 10m
+      memory: 100Mi
+  dependencies:
+  - name: "release:latest"
+    env: RELEASE_IMAGE_LATEST
+  - name: "release:target"
+    env: RELEASE_IMAGE_TARGET  
+  documentation: |-
+    Check that optional capapbilities are enabled as expected after upgrade
diff --git a/ci-operator/step-registry/openshift/upgrade/qe/test/openshift-upgrade-qe-test-chain.yaml b/ci-operator/step-registry/openshift/upgrade/qe/test/openshift-upgrade-qe-test-chain.yaml
index 6c3f81e282260..75ad0a94df549 100644
--- a/ci-operator/step-registry/openshift/upgrade/qe/test/openshift-upgrade-qe-test-chain.yaml
+++ b/ci-operator/step-registry/openshift/upgrade/qe/test/openshift-upgrade-qe-test-chain.yaml
@@ -7,6 +7,7 @@ chain:
   - ref: cucushift-upgrade-prepare
   - ref: cucushift-upgrade-healthcheck
   - ref: cucushift-upgrade-toimage
+  - ref: cucushift-upgrade-check-capability
   - ref: openshift-extended-upgrade-post
   - ref: cucushift-upgrade-check
   - ref: cucushift-upgrade-report