diff --git a/Cargo.lock b/Cargo.lock
index b2244d92594..87e921a8e61 100644
--- a/Cargo.lock
+++ b/Cargo.lock
@@ -1391,9 +1391,8 @@ dependencies = [
 
 [[package]]
 name = "futures-bounded"
-version = "0.2.4"
-source = "registry+https://github.com/rust-lang/crates.io-index"
-checksum = "91f328e7fb845fc832912fb6a34f40cf6d1888c92f974d1893a54e97b5ff542e"
+version = "0.3.0"
+source = "git+https://github.com/thomaseizinger/rust-futures-bounded?rev=012803d343b5c604e65d3c238a8cd7a145616447#012803d343b5c604e65d3c238a8cd7a145616447"
 dependencies = [
  "futures-timer",
  "futures-util",
@@ -2721,7 +2720,7 @@ dependencies = [
 
 [[package]]
 name = "libp2p-kad"
-version = "0.49.0"
+version = "0.49.1"
 dependencies = [
  "asynchronous-codec",
  "bytes",
diff --git a/Cargo.toml b/Cargo.toml
index c2e89a0fada..6f4e817157a 100644
--- a/Cargo.toml
+++ b/Cargo.toml
@@ -85,7 +85,7 @@ libp2p-floodsub = { version = "0.47.0", path = "protocols/floodsub" }
 libp2p-gossipsub = { version = "0.50.0", path = "protocols/gossipsub" }
 libp2p-identify = { version = "0.47.0", path = "protocols/identify" }
 libp2p-identity = { version = "0.2.12" }
-libp2p-kad = { version = "0.49.0", path = "protocols/kad" }
+libp2p-kad = { version = "0.49.1", path = "protocols/kad" }
 libp2p-mdns = { version = "0.48.0", path = "protocols/mdns" }
 libp2p-memory-connection-limits = { version = "0.5.0", path = "misc/memory-connection-limits" }
 libp2p-metrics = { version = "0.17.0", path = "misc/metrics" }
@@ -121,7 +121,8 @@ libp2p-yamux = { version = "0.47.0", path = "muxers/yamux" }
 asynchronous-codec = { version = "0.7.0" }
 env_logger = "0.11"
 futures = "0.3.30"
-futures-bounded = { version = "0.2.4" }
+# TODO: replace with version = "0.3.1" once released upstream
+futures-bounded = { git = "https://github.com/thomaseizinger/rust-futures-bounded", rev = "012803d343b5c604e65d3c238a8cd7a145616447", features = ["futures-timer"] }
 futures-rustls = { version = "0.26.0", default-features = false }
 getrandom = "0.2"
 if-watch = "3.2.1"
diff --git a/protocols/autonat/src/v2/client/handler/dial_back.rs b/protocols/autonat/src/v2/client/handler/dial_back.rs
index 3fd3cf0b5ed..3c0c7ca9f7f 100644
--- a/protocols/autonat/src/v2/client/handler/dial_back.rs
+++ b/protocols/autonat/src/v2/client/handler/dial_back.rs
@@ -6,7 +6,7 @@ use std::{
 };
 
 use futures::channel::oneshot;
-use futures_bounded::StreamSet;
+use futures_bounded::{Delay, StreamSet};
 use libp2p_core::upgrade::{DeniedUpgrade, ReadyUpgrade};
 use libp2p_swarm::{
     handler::{ConnectionEvent, FullyNegotiatedInbound, ListenUpgradeError},
@@ -22,7 +22,7 @@ pub struct Handler {
 impl Handler {
     pub(crate) fn new() -> Self {
         Self {
-            inbound: StreamSet::new(Duration::from_secs(5), 2),
+            inbound: StreamSet::new(|| Delay::futures_timer(Duration::from_secs(5)), 2),
         }
     }
 }
diff --git a/protocols/autonat/src/v2/client/handler/dial_request.rs b/protocols/autonat/src/v2/client/handler/dial_request.rs
index bafdd9d818c..b3dc017ad1b 100644
--- a/protocols/autonat/src/v2/client/handler/dial_request.rs
+++ b/protocols/autonat/src/v2/client/handler/dial_request.rs
@@ -8,7 +8,7 @@ use std::{
 };
 
 use futures::{channel::oneshot, AsyncWrite};
-use futures_bounded::FuturesMap;
+use futures_bounded::{Delay, FuturesMap};
 use libp2p_core::{
     upgrade::{DeniedUpgrade, ReadyUpgrade},
     Multiaddr,
@@ -91,7 +91,7 @@ impl Handler {
     pub(crate) fn new() -> Self {
         Self {
             queued_events: VecDeque::new(),
-            outbound: FuturesMap::new(Duration::from_secs(10), 10),
+            outbound: FuturesMap::new(|| Delay::futures_timer(Duration::from_secs(10)), 10),
             queued_streams: VecDeque::default(),
         }
     }
diff --git a/protocols/autonat/src/v2/server/handler/dial_back.rs b/protocols/autonat/src/v2/server/handler/dial_back.rs
index 836cb50b5c3..736a9aa34b2 100644
--- a/protocols/autonat/src/v2/server/handler/dial_back.rs
+++ b/protocols/autonat/src/v2/server/handler/dial_back.rs
@@ -6,7 +6,7 @@ use std::{
 };
 
 use futures::{AsyncRead, AsyncWrite};
-use futures_bounded::FuturesSet;
+use futures_bounded::{Delay, FuturesSet};
 use libp2p_core::upgrade::{DeniedUpgrade, ReadyUpgrade};
 use libp2p_swarm::{
     handler::{ConnectionEvent, DialUpgradeError, FullyNegotiatedOutbound},
@@ -33,7 +33,7 @@ impl Handler {
         Self {
             pending_nonce: Some(cmd),
             requested_substream_nonce: None,
-            outbound: FuturesSet::new(Duration::from_secs(10), 5),
+            outbound: FuturesSet::new(|| Delay::futures_timer(Duration::from_secs(10)), 5),
         }
     }
 }
diff --git a/protocols/autonat/src/v2/server/handler/dial_request.rs b/protocols/autonat/src/v2/server/handler/dial_request.rs
index 5b4318bd643..bd0a4c326b7 100644
--- a/protocols/autonat/src/v2/server/handler/dial_request.rs
+++ b/protocols/autonat/src/v2/server/handler/dial_request.rs
@@ -10,7 +10,7 @@ use futures::{
     channel::{mpsc, oneshot},
     AsyncRead, AsyncWrite, SinkExt, StreamExt,
 };
-use futures_bounded::FuturesSet;
+use futures_bounded::{Delay, FuturesSet};
 use libp2p_core::{
     upgrade::{DeniedUpgrade, ReadyUpgrade},
     Multiaddr,
@@ -64,7 +64,7 @@ where
             observed_multiaddr,
             dial_back_cmd_sender,
             dial_back_cmd_receiver,
-            inbound: FuturesSet::new(Duration::from_secs(10), 10),
+            inbound: FuturesSet::new(|| Delay::futures_timer(Duration::from_secs(10)), 10),
             rng,
         }
     }
diff --git a/protocols/dcutr/src/handler/relayed.rs b/protocols/dcutr/src/handler/relayed.rs
index af84d8fe9b1..f4d775fd6ae 100644
--- a/protocols/dcutr/src/handler/relayed.rs
+++ b/protocols/dcutr/src/handler/relayed.rs
@@ -29,6 +29,7 @@ use std::{
 
 use either::Either;
 use futures::future;
+use futures_bounded::Delay;
 use libp2p_core::{
     multiaddr::Multiaddr,
     upgrade::{DeniedUpgrade, ReadyUpgrade},
@@ -87,8 +88,14 @@ impl Handler {
         Self {
             endpoint,
             queued_events: Default::default(),
-            inbound_stream: futures_bounded::FuturesSet::new(Duration::from_secs(10), 1),
-            outbound_stream: futures_bounded::FuturesSet::new(Duration::from_secs(10), 1),
+            inbound_stream: futures_bounded::FuturesSet::new(
+                || Delay::futures_timer(Duration::from_secs(10)),
+                1,
+            ),
+            outbound_stream: futures_bounded::FuturesSet::new(
+                || Delay::futures_timer(Duration::from_secs(10)),
+                1,
+            ),
             holepunch_candidates,
             attempts: 0,
         }
diff --git a/protocols/identify/src/handler.rs b/protocols/identify/src/handler.rs
index c2e31ae95f6..478c33d413b 100644
--- a/protocols/identify/src/handler.rs
+++ b/protocols/identify/src/handler.rs
@@ -139,7 +139,7 @@ impl Handler {
             remote_peer_id,
             events: SmallVec::new(),
             active_streams: futures_bounded::FuturesSet::new(
-                STREAM_TIMEOUT,
+                || futures_bounded::Delay::futures_timer(STREAM_TIMEOUT),
                 MAX_CONCURRENT_STREAMS_PER_CONNECTION,
             ),
             trigger_next_identify: Delay::new(Duration::ZERO),
diff --git a/protocols/kad/CHANGELOG.md b/protocols/kad/CHANGELOG.md
index d50f7319af8..2902ca87e03 100644
--- a/protocols/kad/CHANGELOG.md
+++ b/protocols/kad/CHANGELOG.md
@@ -1,3 +1,8 @@
+## 0.49.1
+
+- Enforce an inbound substream timeout in the kad substream handler.
+  See [PR 6009](https://github.com/libp2p/rust-libp2p/pull/6009).
+
 ## 0.49.0
 
 - Remove no longer constructed GetRecordError::QuorumFailed.
diff --git a/protocols/kad/Cargo.toml b/protocols/kad/Cargo.toml
index fd0c8e0eb75..81b8f7db8f9 100644
--- a/protocols/kad/Cargo.toml
+++ b/protocols/kad/Cargo.toml
@@ -3,7 +3,7 @@ name = "libp2p-kad"
 edition.workspace = true
 rust-version = { workspace = true }
 description = "Kademlia protocol for libp2p"
-version = "0.49.0"
+version = "0.49.1"
 authors = ["Parity Technologies <admin@parity.io>"]
 license = "MIT"
 repository = "https://github.com/libp2p/rust-libp2p"
diff --git a/protocols/kad/src/handler.rs b/protocols/kad/src/handler.rs
index 2c7b6c52257..a95ff589d5d 100644
--- a/protocols/kad/src/handler.rs
+++ b/protocols/kad/src/handler.rs
@@ -27,7 +27,8 @@ use std::{
 };
 
 use either::Either;
-use futures::{channel::oneshot, prelude::*, stream::SelectAll};
+use futures::{channel::oneshot, prelude::*};
+use futures_bounded::{Delay, StreamSet};
 use libp2p_core::{upgrade, ConnectedPoint};
 use libp2p_identity::PeerId;
 use libp2p_swarm::{
@@ -77,7 +78,8 @@ pub struct Handler {
     pending_messages: VecDeque<(KadRequestMsg, QueryId)>,
 
     /// List of active inbound substreams with the state they are in.
-    inbound_substreams: SelectAll<InboundSubstreamState>,
+    /// The streams are typed `InboundSubstreamState`, but the set uses the item type.
+    inbound_substreams: StreamSet<ConnectionHandlerEvent<ProtocolConfig, (), HandlerEvent>>,
 
     /// The connected endpoint of the connection that the handler
     /// is associated with.
@@ -119,8 +121,6 @@ enum InboundSubstreamState {
     PendingFlush(UniqueConnecId, KadInStreamSink<Stream>),
     /// The substream is being closed.
     Closing(KadInStreamSink<Stream>),
-    /// The substream was cancelled in favor of a new one.
-    Cancelled,
 
     Poisoned {
         phantom: PhantomData<QueryId>,
@@ -173,9 +173,6 @@ impl InboundSubstreamState {
             | InboundSubstreamState::Closing(substream) => {
                 *self = InboundSubstreamState::Closing(substream);
             }
-            InboundSubstreamState::Cancelled => {
-                *self = InboundSubstreamState::Cancelled;
-            }
             InboundSubstreamState::Poisoned { .. } => unreachable!(),
         }
     }
@@ -461,9 +458,12 @@ impl Handler {
             endpoint,
             remote_peer_id,
             next_connec_unique_id: UniqueConnecId(0),
-            inbound_substreams: Default::default(),
+            inbound_substreams: StreamSet::new(
+                move || Delay::futures_timer(substreams_timeout),
+                MAX_NUM_STREAMS,
+            ),
             outbound_substreams: futures_bounded::FuturesTupleSet::new(
-                substreams_timeout,
+                move || Delay::futures_timer(substreams_timeout),
                 MAX_NUM_STREAMS,
             ),
             pending_streams: Default::default(),
@@ -518,19 +518,31 @@ impl Handler {
             });
         }
 
-        if self.inbound_substreams.len() == MAX_NUM_STREAMS {
-            if let Some(s) = self.inbound_substreams.iter_mut().find(|s| {
-                matches!(
-                    s,
-                    // An inbound substream waiting to be reused.
-                    InboundSubstreamState::WaitingMessage { first: false, .. }
-                )
-            }) {
-                *s = InboundSubstreamState::Cancelled;
+        let connec_unique_id = self.next_connec_unique_id;
+        self.next_connec_unique_id.0 += 1;
+        let new_substream = InboundSubstreamState::WaitingMessage {
+            first: true,
+            connection_id: connec_unique_id,
+            substream: protocol,
+        };
+
+        if self.inbound_substreams.len() >= MAX_NUM_STREAMS {
+            if let Some(s) = self
+                .inbound_substreams
+                .iter_mut_of_type::<InboundSubstreamState>()
+                .find(|s| {
+                    matches!(
+                        **s,
+                        // An inbound substream waiting to be reused.
+                        InboundSubstreamState::WaitingMessage { first: false, .. }
+                    )
+                })
+            {
+                *s.get_mut() = new_substream;
                 tracing::debug!(
                     peer=?self.remote_peer_id,
                     "New inbound substream to peer exceeds inbound substream limit. \
-                    Removed older substream waiting to be reused."
+                    Replacing older substream that was waiting to be reused."
                 )
             } else {
                 tracing::warn!(
@@ -538,18 +550,13 @@ impl Handler {
                     "New inbound substream to peer exceeds inbound substream limit. \
                      No older substream waiting to be reused. Dropping new substream."
                 );
-                return;
             }
+        } else {
+            self.inbound_substreams
+                .try_push(new_substream)
+                .map_err(|_| ())
+                .expect("Just checked that stream set is not full; qed");
         }
-
-        let connec_unique_id = self.next_connec_unique_id;
-        self.next_connec_unique_id.0 += 1;
-        self.inbound_substreams
-            .push(InboundSubstreamState::WaitingMessage {
-                first: true,
-                connection_id: connec_unique_id,
-                substream: protocol,
-            });
     }
 
     /// Takes the given [`KadRequestMsg`] and composes it into an outbound request-response protocol
@@ -616,15 +623,15 @@ impl ConnectionHandler for Handler {
             HandlerIn::Reset(request_id) => {
                 if let Some(state) = self
                     .inbound_substreams
-                    .iter_mut()
-                    .find(|state| match state {
+                    .iter_mut_of_type::<InboundSubstreamState>()
+                    .find(|state| match **state {
                         InboundSubstreamState::WaitingBehaviour(conn_id, _, _) => {
-                            conn_id == &request_id.connec_unique_id
+                            conn_id == request_id.connec_unique_id
                         }
                         _ => false,
                     })
                 {
-                    state.close();
+                    state.get_mut().close();
                 }
             }
             HandlerIn::FindNodeReq { key, query_id } => {
@@ -763,8 +770,16 @@ impl ConnectionHandler for Handler {
                 Poll::Pending => {}
             }
 
-            if let Poll::Ready(Some(event)) = self.inbound_substreams.poll_next_unpin(cx) {
-                return Poll::Ready(event);
+            if let Poll::Ready(Some(event_result)) = self.inbound_substreams.poll_next_unpin(cx) {
+                match event_result {
+                    Ok(event) => return Poll::Ready(event),
+                    Err(_stream_set_timeout) => {
+                        tracing::trace!(
+                            "Inbound substream timed out waiting for peer, send, or close"
+                        );
+                        continue;
+                    }
+                }
             }
 
             if self.outbound_substreams.len() < MAX_NUM_STREAMS {
@@ -848,8 +863,11 @@ fn compute_new_protocol_status(
 
 impl Handler {
     fn answer_pending_request(&mut self, request_id: RequestId, mut msg: KadResponseMsg) {
-        for state in self.inbound_substreams.iter_mut() {
-            match state.try_answer_with(request_id, msg) {
+        for state in self
+            .inbound_substreams
+            .iter_mut_of_type::<InboundSubstreamState>()
+        {
+            match state.get_mut().try_answer_with(request_id, msg) {
                 Ok(()) => return,
                 Err(m) => {
                     msg = m;
@@ -1006,7 +1024,6 @@ impl futures::Stream for InboundSubstreamState {
                     }
                 },
                 InboundSubstreamState::Poisoned { .. } => unreachable!(),
-                InboundSubstreamState::Cancelled => return Poll::Ready(None),
             }
         }
     }
diff --git a/protocols/perf/src/server/handler.rs b/protocols/perf/src/server/handler.rs
index 2748a5b6ad9..0d0b7dc8e07 100644
--- a/protocols/perf/src/server/handler.rs
+++ b/protocols/perf/src/server/handler.rs
@@ -24,6 +24,7 @@ use std::{
 };
 
 use futures::FutureExt;
+use futures_bounded::Delay;
 use libp2p_core::upgrade::{DeniedUpgrade, ReadyUpgrade};
 use libp2p_swarm::{
     handler::{
@@ -49,7 +50,7 @@ impl Handler {
     pub fn new() -> Self {
         Self {
             inbound: futures_bounded::FuturesSet::new(
-                crate::RUN_TIMEOUT,
+                || Delay::futures_timer(crate::RUN_TIMEOUT),
                 crate::MAX_PARALLEL_RUNS_PER_CONNECTION,
             ),
         }
diff --git a/protocols/relay/src/behaviour/handler.rs b/protocols/relay/src/behaviour/handler.rs
index af130c35516..3a9982cd776 100644
--- a/protocols/relay/src/behaviour/handler.rs
+++ b/protocols/relay/src/behaviour/handler.rs
@@ -391,11 +391,11 @@ impl Handler {
     pub fn new(config: Config, endpoint: ConnectedPoint) -> Handler {
         Handler {
             inbound_workers: futures_bounded::FuturesSet::new(
-                STREAM_TIMEOUT,
+                || futures_bounded::Delay::futures_timer(STREAM_TIMEOUT),
                 MAX_CONCURRENT_STREAMS_PER_CONNECTION,
             ),
             outbound_workers: futures_bounded::FuturesMap::new(
-                STREAM_TIMEOUT,
+                || futures_bounded::Delay::futures_timer(STREAM_TIMEOUT),
                 MAX_CONCURRENT_STREAMS_PER_CONNECTION,
             ),
             endpoint,
diff --git a/protocols/relay/src/priv_client/handler.rs b/protocols/relay/src/priv_client/handler.rs
index 5f46dbf4460..fe5c6dd542b 100644
--- a/protocols/relay/src/priv_client/handler.rs
+++ b/protocols/relay/src/priv_client/handler.rs
@@ -142,19 +142,19 @@ impl Handler {
             queued_events: Default::default(),
             pending_streams: Default::default(),
             inflight_reserve_requests: futures_bounded::FuturesTupleSet::new(
-                STREAM_TIMEOUT,
+                || futures_bounded::Delay::futures_timer(STREAM_TIMEOUT),
                 MAX_CONCURRENT_STREAMS_PER_CONNECTION,
             ),
             inflight_inbound_circuit_requests: futures_bounded::FuturesSet::new(
-                STREAM_TIMEOUT,
+                || futures_bounded::Delay::futures_timer(STREAM_TIMEOUT),
                 MAX_CONCURRENT_STREAMS_PER_CONNECTION,
             ),
             inflight_outbound_connect_requests: futures_bounded::FuturesTupleSet::new(
-                STREAM_TIMEOUT,
+                || futures_bounded::Delay::futures_timer(STREAM_TIMEOUT),
                 MAX_CONCURRENT_STREAMS_PER_CONNECTION,
             ),
             inflight_outbound_circuit_deny_requests: futures_bounded::FuturesSet::new(
-                DENYING_CIRCUIT_TIMEOUT,
+                || futures_bounded::Delay::futures_timer(DENYING_CIRCUIT_TIMEOUT),
                 MAX_NUMBER_DENYING_CIRCUIT,
             ),
             reservation: Reservation::None,
diff --git a/protocols/request-response/src/handler.rs b/protocols/request-response/src/handler.rs
index abc994f160e..ba2c2271411 100644
--- a/protocols/request-response/src/handler.rs
+++ b/protocols/request-response/src/handler.rs
@@ -35,6 +35,7 @@ use futures::{
     channel::{mpsc, oneshot},
     prelude::*,
 };
+use futures_bounded::Delay;
 use libp2p_swarm::{
     handler::{
         ConnectionEvent, ConnectionHandler, ConnectionHandlerEvent, DialUpgradeError,
@@ -111,7 +112,7 @@ where
             pending_events: VecDeque::new(),
             inbound_request_id,
             worker_streams: futures_bounded::FuturesMap::new(
-                substream_timeout,
+                move || Delay::futures_timer(substream_timeout),
                 max_concurrent_streams,
             ),
         }