diff --git a/provider/pkg/provider/auth_azidentity.go b/provider/pkg/provider/auth_azidentity.go
index cd05edfd0129..8af47cf56ab2 100644
--- a/provider/pkg/provider/auth_azidentity.go
+++ b/provider/pkg/provider/auth_azidentity.go
@@ -170,8 +170,13 @@ func getOidcTokenExchangeAssertion(authConf *authConfiguration) func(ctx context
 		if err != nil {
 			return "", fmt.Errorf("githubAssertion: cannot parse URL query")
 		}
+
 		// see https://docs.github.com/en/actions/security-for-github-actions/security-hardening-your-deployments/configuring-openid-connect-in-azure#adding-the-federated-credentials-to-azure
-		query.Set("audience", "api://AzureADTokenExchange")
+		audience := "api://AzureADTokenExchange"
+		if authConf.oidcAudience != "" {
+			audience = authConf.oidcAudience
+		}
+		query.Set("audience", audience)
 		req.URL.RawQuery = query.Encode()
 
 		req.Header.Set("Accept", "application/json")
@@ -235,6 +240,7 @@ type authConfiguration struct {
 	auxTenants []string
 
 	useOidc               bool
+	oidcAudience          string
 	oidcToken             string
 	oidcTokenFilePath     string
 	oidcTokenRequestToken string
@@ -275,6 +281,7 @@ func (k *azureNativeProvider) readAuthConfig() (*authConfiguration, error) {
 		useMsi: k.getConfig("useMsi", "ARM_USE_MSI") == "true",
 
 		useOidc:               k.getConfig("useOidc", "ARM_USE_OIDC") == "true",
+		oidcAudience:          k.getConfig("oidcAudience", "ARM_OIDC_AUDIENCE"),
 		oidcToken:             k.getConfig("oidcToken", "ARM_OIDC_TOKEN"),
 		oidcTokenFilePath:     k.getConfig("oidcTokenFilePath", "ARM_OIDC_TOKEN_FILE_PATH"),
 		oidcTokenRequestToken: k.getConfig("oidcRequestToken", "ACTIONS_ID_TOKEN_REQUEST_TOKEN"),
diff --git a/provider/pkg/provider/auth_azidentity_test.go b/provider/pkg/provider/auth_azidentity_test.go
index c95ee061b721..838348f45fb5 100644
--- a/provider/pkg/provider/auth_azidentity_test.go
+++ b/provider/pkg/provider/auth_azidentity_test.go
@@ -29,6 +29,7 @@ func TestGetAuthConfig(t *testing.T) {
 		t.Setenv("ARM_CLIENT_CERTIFICATE_PATH", value)
 		t.Setenv("ARM_CLIENT_ID", value)
 		t.Setenv("ARM_CLIENT_SECRET", value)
+		t.Setenv("ARM_OIDC_AUDIENCE", value)
 		t.Setenv("ARM_OIDC_TOKEN", value)
 		t.Setenv("ARM_OIDC_TOKEN_FILE_PATH", value)
 		t.Setenv("ACTIONS_ID_TOKEN_REQUEST_TOKEN", value)
@@ -49,6 +50,7 @@ func TestGetAuthConfig(t *testing.T) {
 		require.Empty(t, c.clientCertPath)
 		require.Empty(t, c.clientId)
 		require.Empty(t, c.clientSecret)
+		require.Empty(t, c.oidcAudience)
 		require.Empty(t, c.oidcToken)
 		require.Empty(t, c.oidcTokenFilePath)
 		require.Empty(t, c.oidcTokenRequestToken)
@@ -69,6 +71,7 @@ func TestGetAuthConfig(t *testing.T) {
 				"clientId":                  "conf",
 				"clientSecret":              "conf",
 				"environment":               "usgov",
+				"oidcAudience":              "conf",
 				"oidcToken":                 "conf",
 				"oidcTokenFilePath":         "conf",
 				"oidcRequestToken":          "conf",
@@ -88,6 +91,7 @@ func TestGetAuthConfig(t *testing.T) {
 		require.Equal(t, "conf", c.clientCertPath)
 		require.Equal(t, "conf", c.clientId)
 		require.Equal(t, "conf", c.clientSecret)
+		require.Equal(t, "conf", c.oidcAudience)
 		require.Equal(t, "conf", c.oidcToken)
 		require.Equal(t, "conf", c.oidcTokenFilePath)
 		require.Equal(t, "conf", c.oidcTokenRequestToken)
@@ -111,6 +115,7 @@ func TestGetAuthConfig(t *testing.T) {
 		require.Equal(t, "env", c.clientCertPath)
 		require.Equal(t, "env", c.clientId)
 		require.Equal(t, "env", c.clientSecret)
+		require.Equal(t, "env", c.oidcAudience)
 		require.Equal(t, "env", c.oidcToken)
 		require.Equal(t, "env", c.oidcTokenFilePath)
 		require.Equal(t, "env", c.oidcTokenRequestToken)
@@ -239,6 +244,20 @@ func TestNewCredential(t *testing.T) {
 		require.IsType(t, &azidentity.ClientAssertionCredential{}, cred)
 	})
 
+	t.Run("OIDC with token exchange URL and custom audience", func(t *testing.T) {
+		conf := &authConfiguration{
+			useOidc:               true,
+			oidcAudience:          "api://oidc-audience",
+			oidcTokenRequestToken: "oidc-token",
+			oidcTokenRequestUrl:   "oidc-token-url",
+			clientId:              "client-id",
+			tenantId:              "tenant-id",
+		}
+		cred, err := newSingleMethodAuthCredential(conf)
+		require.NoError(t, err)
+		require.IsType(t, &azidentity.ClientAssertionCredential{}, cred)
+	})
+
 	t.Run("Incomplete OIDC conf", func(t *testing.T) {
 		for _, conf := range []*authConfiguration{
 			{