diff --git a/etc/kayobe/kolla-image-tags.yml b/etc/kayobe/kolla-image-tags.yml
index 2b39285c1..b115b7185 100644
--- a/etc/kayobe/kolla-image-tags.yml
+++ b/etc/kayobe/kolla-image-tags.yml
@@ -9,3 +9,6 @@ kolla_image_tags:
   keystone:
     rocky-9: 2025.1-rocky-9-20250805T134044
     ubuntu-noble: 2025.1-ubuntu-noble-20250805T134044
+  magnum:
+    rocky-9: 2025.1-rocky-9-20250805T095746
+    ubuntu-noble: 2025.1-ubuntu-noble-20250805T095746
diff --git a/etc/kayobe/kolla.yml b/etc/kayobe/kolla.yml
index 7c7617d91..2c8776351 100644
--- a/etc/kayobe/kolla.yml
+++ b/etc/kayobe/kolla.yml
@@ -362,7 +362,7 @@ kolla_build_customizations_common:
     - /additions/*
   magnum_base_pip_packages_override:
     - /magnum[osprofiler]
-    - magnum-capi-helm==1.2.1
+    - magnum-capi-helm==1.3.0
   neutron_server_packages_append:
     - python3-libvirt
     - python3-ethtool
diff --git a/releasenotes/notes/update-magnum-capi-driver-c85135340731a86a.yaml b/releasenotes/notes/update-magnum-capi-driver-c85135340731a86a.yaml
new file mode 100644
index 000000000..8c3eaccec
--- /dev/null
+++ b/releasenotes/notes/update-magnum-capi-driver-c85135340731a86a.yaml
@@ -0,0 +1,6 @@
+---
+features:
+  - |
+    Updated the version of magnum-capi-helm driver to 1.3.0.
+    For the list of features and fixes see its
+    `release notes <https://docs.openstack.org/releasenotes/magnum-capi-helm/unreleased.html#relnotes-1-3-0>`__.