diff --git a/CHANGELOG.md b/CHANGELOG.md
index 32ac06cee..9dd19fb1b 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -4,6 +4,9 @@ The format is based on [Keep a Changelog](https://keepachangelog.com/en/1.0.0/).
 
 # Upcoming
 
+### 🐞 Fixed
+- Fix permission prompts appearing when not needed. [#988](https://github.com/GetStream/stream-video-swift/pull/988)
+
 ### ✅ Added
 - SwiftUI modifiers that surface moderation blur and warning events in `CallView`. [#987](https://github.com/GetStream/stream-video-swift/pull/987)
 
diff --git a/Sources/StreamVideo/WebRTC/PeerConnectionFactory.swift b/Sources/StreamVideo/WebRTC/PeerConnectionFactory.swift
index 39feab1f8..8e49eabdf 100644
--- a/Sources/StreamVideo/WebRTC/PeerConnectionFactory.swift
+++ b/Sources/StreamVideo/WebRTC/PeerConnectionFactory.swift
@@ -20,7 +20,7 @@ final class PeerConnectionFactory: @unchecked Sendable {
         )
         let decoderFactory = RTCDefaultVideoDecoderFactory()
         return RTCPeerConnectionFactory(
-            audioDeviceModuleType: .platformDefault,
+            audioDeviceModuleType: .audioEngine,
             bypassVoiceProcessing: false,
             encoderFactory: encoderFactory,
             decoderFactory: decoderFactory,
diff --git a/Sources/StreamVideo/WebRTC/v2/WebRTCPermissionsAdapter.swift b/Sources/StreamVideo/WebRTC/v2/WebRTCPermissionsAdapter.swift
index 7e9777cf8..3507b2254 100644
--- a/Sources/StreamVideo/WebRTC/v2/WebRTCPermissionsAdapter.swift
+++ b/Sources/StreamVideo/WebRTC/v2/WebRTCPermissionsAdapter.swift
@@ -52,6 +52,7 @@ final class WebRTCPermissionsAdapter: @unchecked Sendable {
     private weak var delegate: WebRTCPermissionsAdapterDelegate?
     private var requiredPermissions: Set<RequiredPermission> = []
     private var lastCallSettings: CallSettings?
+    private var ownCapabilities: Set<OwnCapability> = []
 
     /// Creates an adapter and begins observing app/permission changes.
     ///
@@ -155,6 +156,12 @@ final class WebRTCPermissionsAdapter: @unchecked Sendable {
         }
     }
 
+    func willSet(ownCapabilities: Set<OwnCapability>) {
+        processingQueue.addOperation { [weak self] in
+            self?.ownCapabilities = ownCapabilities
+        }
+    }
+
     func cleanUp() {
         processingQueue.addOperation { [weak self] in
             // By emptying the Set we are saying that there are no permissions
@@ -237,9 +244,11 @@ final class WebRTCPermissionsAdapter: @unchecked Sendable {
 
             switch permission {
             case .microphone:
-                return !permissions.hasMicrophonePermission && permissions.canRequestMicrophonePermission
+                return !permissions.hasMicrophonePermission && permissions.canRequestMicrophonePermission && ownCapabilities
+                    .contains(.sendAudio)
             case .camera:
-                return !permissions.hasCameraPermission && permissions.canRequestCameraPermission
+                return !permissions.hasCameraPermission && permissions.canRequestCameraPermission && ownCapabilities
+                    .contains(.sendVideo)
             }
         }
     }
diff --git a/Sources/StreamVideo/WebRTC/v2/WebRTCStateAdapter.swift b/Sources/StreamVideo/WebRTC/v2/WebRTCStateAdapter.swift
index c7e3eff9e..13f52b846 100644
--- a/Sources/StreamVideo/WebRTC/v2/WebRTCStateAdapter.swift
+++ b/Sources/StreamVideo/WebRTC/v2/WebRTCStateAdapter.swift
@@ -165,7 +165,10 @@ actor WebRTCStateAdapter: ObservableObject, StreamAudioSessionAdapterDelegate, W
     func set(connectOptions value: ConnectOptions) { self.connectOptions = value }
 
     /// Sets the own capabilities of the current user.
-    func set(ownCapabilities value: Set<OwnCapability>) { self.ownCapabilities = value }
+    func set(ownCapabilities value: Set<OwnCapability>) {
+        self.ownCapabilities = value
+        permissionsAdapter.willSet(ownCapabilities: value)
+    }
 
     /// Sets the WebRTC stats reporter.
     func set(statsAdapter value: WebRTCStatsAdapting?) {
diff --git a/StreamVideoTests/WebRTC/v2/WebRTCPermissionsAdapter_Tests.swift b/StreamVideoTests/WebRTC/v2/WebRTCPermissionsAdapter_Tests.swift
index 95b8e45d8..bf98c27b3 100644
--- a/StreamVideoTests/WebRTC/v2/WebRTCPermissionsAdapter_Tests.swift
+++ b/StreamVideoTests/WebRTC/v2/WebRTCPermissionsAdapter_Tests.swift
@@ -22,7 +22,7 @@ final class WebRTCPermissionsAdapter_Tests: StreamVideoTestCase, @unchecked Send
         super.tearDown()
     }
 
-    func test_willSet_audioOnTrue_withDeniedMic_downgradesAudioOff() async {
+    func test_willSet_audioOnTrue_withoutSendAudio_withDeniedMic_downgradesAudioOff() async {
         mockAppStateAdapter.makeShared()
         mockPermissions.stubMicrophonePermission(.denied)
         await fulfillment { self.mockPermissions.mockStore.state.microphonePermission == .denied }
@@ -34,7 +34,33 @@ final class WebRTCPermissionsAdapter_Tests: StreamVideoTestCase, @unchecked Send
         XCTAssertEqual(output.videoOn, false)
     }
 
-    func test_willSet_videoOnTrue_withDeniedCamera_downgradesVideoOff() async {
+    func test_willSet_audioOnTrue_withSendAudio_withDeniedMic_downgradesAudioOff() async {
+        mockAppStateAdapter.makeShared()
+        mockPermissions.stubMicrophonePermission(.denied)
+        await fulfillment { self.mockPermissions.mockStore.state.microphonePermission == .denied }
+
+        let input = CallSettings(audioOn: true, videoOn: false)
+        subject.willSet(ownCapabilities: [.sendAudio])
+        let output = await subject.willSet(callSettings: input)
+
+        XCTAssertEqual(output.audioOn, false)
+        XCTAssertEqual(output.videoOn, false)
+    }
+
+    func test_willSet_videoOnTrue_withSendVideo_withDeniedCamera_downgradesVideoOff() async {
+        mockAppStateAdapter.makeShared()
+        mockPermissions.stubCameraPermission(.denied)
+        await fulfillment { self.mockPermissions.mockStore.state.cameraPermission == .denied }
+
+        let input = CallSettings(audioOn: false, videoOn: true)
+        subject.willSet(ownCapabilities: [.sendVideo])
+        let output = await subject.willSet(callSettings: input)
+
+        XCTAssertEqual(output.audioOn, false)
+        XCTAssertEqual(output.videoOn, false)
+    }
+
+    func test_willSet_videoOnTrue_withoutSendVideo_withDeniedCamera_downgradesVideoOff() async {
         mockAppStateAdapter.makeShared()
         mockPermissions.stubCameraPermission(.denied)
         await fulfillment { self.mockPermissions.mockStore.state.cameraPermission == .denied }
@@ -46,10 +72,22 @@ final class WebRTCPermissionsAdapter_Tests: StreamVideoTestCase, @unchecked Send
         XCTAssertEqual(output.videoOn, false)
     }
 
-    func test_willSet_audioOnTrue_unknownMic_inForeground_requestsPermission_andKeepsAudioOnWhenGranted() async {
+    func test_willSet_audioOnTrue_unknownMic_inForeground_withoutSendAudio_requestsPermission_andKeepsAudioOnWhenGranted() async {
+        mockAppStateAdapter.makeShared()
+        mockAppStateAdapter.stubbedState = .foreground
+        mockPermissions.stubMicrophonePermission(.unknown)
+        await fulfillment { self.mockPermissions.mockStore.state.microphonePermission == .unknown }
+
+        let input = CallSettings(audioOn: true, videoOn: false)
+        let output = await self.subject.willSet(callSettings: input)
+        XCTAssertEqual(output.audioOn, false)
+    }
+
+    func test_willSet_audioOnTrue_unknownMic_inForeground_withSendAudio_requestsPermission_andKeepsAudioOnWhenGranted() async {
         mockAppStateAdapter.makeShared()
         mockAppStateAdapter.stubbedState = .foreground
         mockPermissions.stubMicrophonePermission(.unknown)
+        subject.willSet(ownCapabilities: [.sendAudio])
         await fulfillment { self.mockPermissions.mockStore.state.microphonePermission == .unknown }
 
         await withTaskGroup(of: Void.self) { group in
@@ -71,10 +109,22 @@ final class WebRTCPermissionsAdapter_Tests: StreamVideoTestCase, @unchecked Send
         }
     }
 
-    func test_willSet_videoOnTrue_unknownCamera_inForeground_requestsPermission_andKeepsVideoOnWhenGranted() async {
+    func test_willSet_videoOnTrue_unknownCamera_inForeground_withoutSendVideo_requestsPermission_andKeepsVideoOnWhenGranted() async {
+        mockAppStateAdapter.makeShared()
+        mockAppStateAdapter.stubbedState = .foreground
+        mockPermissions.stubCameraPermission(.unknown)
+        await fulfillment { self.mockPermissions.mockStore.state.cameraPermission == .unknown }
+
+        let input = CallSettings(audioOn: false, videoOn: true)
+        let output = await self.subject.willSet(callSettings: input)
+        XCTAssertEqual(output.videoOn, false)
+    }
+
+    func test_willSet_videoOnTrue_unknownCamera_inForeground_withSendVideo_requestsPermission_andKeepsVideoOnWhenGranted() async {
         mockAppStateAdapter.makeShared()
         mockAppStateAdapter.stubbedState = .foreground
         mockPermissions.stubCameraPermission(.unknown)
+        subject.willSet(ownCapabilities: [.sendVideo])
         await fulfillment { self.mockPermissions.mockStore.state.cameraPermission == .unknown }
 
         await withTaskGroup(of: Void.self) { group in