diff --git a/pkg/pf/tests/diff_test/diff_test.go b/pkg/pf/tests/diff_test/diff_test.go
index 11927e0e3..9fb5e48d5 100644
--- a/pkg/pf/tests/diff_test/diff_test.go
+++ b/pkg/pf/tests/diff_test/diff_test.go
@@ -1,12 +1,17 @@
 package tfbridgetests
 
 import (
+	"context"
+	"math/big"
+	"os"
 	"testing"
 
+	"github.com/hashicorp/terraform-plugin-framework/resource"
 	rschema "github.com/hashicorp/terraform-plugin-framework/resource/schema"
 	"github.com/hashicorp/terraform-plugin-framework/resource/schema/planmodifier"
 	"github.com/hashicorp/terraform-plugin-framework/resource/schema/stringplanmodifier"
 	"github.com/hexops/autogold/v2"
+	"github.com/pulumi/pulumi/sdk/v3/go/common/util/cmdutil"
 	"github.com/zclconf/go-cty/cty"
 
 	pb "github.com/pulumi/pulumi-terraform-bridge/v3/pkg/pf/internal/providerbuilder"
@@ -176,3 +181,111 @@ func TestPFDetailedDiffStringAttribute(t *testing.T) {
 		})
 	}
 }
+
+func TestPFDetailedDiffDynamicType(t *testing.T) {
+	t.Parallel()
+	if d, ok := os.LookupEnv("PULUMI_RAW_STATE_DELTA_ENABLED"); ok && cmdutil.IsTruthy(d) {
+		// TODO[pulumi/pulumi-terraform-bridge#3078]
+		t.Skip("Does not work with PULUMI_RAW_STATE_DELTA_ENABLED=true")
+	}
+
+	attributeSchema := rschema.Schema{
+		Attributes: map[string]rschema.Attribute{
+			"key": rschema.DynamicAttribute{
+				Optional: true,
+			},
+		},
+	}
+	res := pb.NewResource(pb.NewResourceArgs{
+		ResourceSchema: attributeSchema,
+	})
+
+	t.Run("no change", func(t *testing.T) {
+		crosstests.Diff(t, res,
+			map[string]cty.Value{"key": cty.StringVal("value")},
+			map[string]cty.Value{"key": cty.StringVal("value")},
+		)
+	})
+
+	t.Run("change", func(t *testing.T) {
+		crosstests.Diff(t, res,
+			map[string]cty.Value{"key": cty.StringVal("value")},
+			map[string]cty.Value{"key": cty.StringVal("value1")},
+		)
+	})
+
+	t.Run("int no change", func(t *testing.T) {
+		crosstests.Diff(t, res,
+			map[string]cty.Value{"key": cty.NumberVal(big.NewFloat(1))},
+			map[string]cty.Value{"key": cty.NumberVal(big.NewFloat(1))},
+		)
+	})
+
+	t.Run("type change", func(t *testing.T) {
+		// TODO[pulumi/pulumi-terraform-bridge#3078]
+		t.Skip(`Error converting tftypes.Number<"1"> (value2) at "AttributeName(\"key\")": can't unmarshal tftypes.Number into *string, expected string`)
+		crosstests.Diff(t, res,
+			map[string]cty.Value{"key": cty.StringVal("value")},
+			map[string]cty.Value{"key": cty.NumberVal(big.NewFloat(1))},
+		)
+	})
+}
+
+func TestPFDetailedDiffDynamicTypeWithMigration(t *testing.T) {
+	t.Parallel()
+	// TODO[pulumi/pulumi-terraform-bridge#3078]
+	t.Skip("DynamicPseudoType is not supported")
+
+	attributeSchema := rschema.Schema{
+		Attributes: map[string]rschema.Attribute{
+			"key": rschema.DynamicAttribute{
+				Optional: true,
+			},
+		},
+	}
+	res1 := pb.NewResource(pb.NewResourceArgs{
+		ResourceSchema: attributeSchema,
+	})
+
+	schema2 := rschema.Schema{
+		Attributes: map[string]rschema.Attribute{
+			"key": rschema.DynamicAttribute{
+				Optional: true,
+			},
+		},
+		Version: 1,
+	}
+	res2 := pb.NewResource(pb.NewResourceArgs{
+		ResourceSchema: schema2,
+		UpgradeStateFunc: func(ctx context.Context) map[int64]resource.StateUpgrader {
+			return map[int64]resource.StateUpgrader{
+				0: {
+					PriorSchema: &res1.ResourceSchema,
+					StateUpgrader: func(ctx context.Context, usr1 resource.UpgradeStateRequest, usr2 *resource.UpgradeStateResponse) {
+						usr2.State = *usr1.State
+					},
+				},
+			}
+		},
+	})
+
+	t.Run("no change", func(t *testing.T) {
+		crosstests.Diff(t, res1,
+			map[string]cty.Value{"key": cty.StringVal("value")},
+			map[string]cty.Value{"key": cty.StringVal("value")},
+			crosstests.DiffProviderUpgradedSchema(
+				res2,
+			),
+		)
+	})
+
+	t.Run("change", func(t *testing.T) {
+		crosstests.Diff(t, res1,
+			map[string]cty.Value{"key": cty.StringVal("value")},
+			map[string]cty.Value{"key": cty.StringVal("value1")},
+			crosstests.DiffProviderUpgradedSchema(
+				res2,
+			),
+		)
+	})
+}
diff --git a/pkg/pf/tfbridge/resource_state.go b/pkg/pf/tfbridge/resource_state.go
index 2244ee8e3..4fb1219fd 100644
--- a/pkg/pf/tfbridge/resource_state.go
+++ b/pkg/pf/tfbridge/resource_state.go
@@ -251,15 +251,10 @@ func (p *provider) parseAndUpgradeResourceState(
 	}
 
 	// Otherwise fallback to imprecise legacy parsing.
-	tfType := rh.schema.Type(ctx).(tftypes.Object)
 	value, err := convert.EncodePropertyMap(rh.encoder, props)
 	if err != nil {
 		return nil, fmt.Errorf("[pf/tfbridge] Error calling EncodePropertyMap: %w", err)
 	}
-	rawState, err := pfutils.NewRawState(tfType, value)
-	if err != nil {
-		return nil, fmt.Errorf("[pf/tfbridge] Error calling NewRawState: %w", err)
-	}
 
 	// Before EnableRawStateDelta rollout, the behavior used to be to skip the upgrade method in case of an exact
 	// version match. This seems incorrect, but to derisk fixing this problem it is flagged together with
@@ -272,6 +267,12 @@ func (p *provider) parseAndUpgradeResourceState(
 		}, nil
 	}
 
+	tfType := rh.schema.Type(ctx).(tftypes.Object)
+	rawState, err := pfutils.NewRawState(tfType, value)
+	if err != nil {
+		return nil, fmt.Errorf("[pf/tfbridge] Error calling NewRawState: %w", err)
+	}
+
 	return p.upgradeResourceState(ctx, rh, rawState, parsedMeta.PrivateState, stateVersion)
 }