diff --git a/.github/workflows/scripts/bump-versions.sh b/.github/workflows/scripts/bump-versions.sh
new file mode 100644
index 00000000..cdb90cd3
--- /dev/null
+++ b/.github/workflows/scripts/bump-versions.sh
@@ -0,0 +1,144 @@
+#!/bin/bash
+
+# This script takes either current beta version, current stable version, or both,
+# and optionally next beta version and next stable version, and updates the version
+# in the specified files. If next version is not provided, it will infer the next 
+# semantic version (e.g. v0.110.0 -> v0.111.0 or v1.16.0 -> v1.17.0) based on the 
+# current version(s) passed.
+
+# Function to display usage
+usage() {
+  echo "Usage: $0 --current_beta <current_beta> [--current_stable <current_stable>] [--next_beta <next_beta>] [--next_stable <next_stable>]"
+  exit 1
+}
+
+# Function to validate semantic version and strip leading 'v'
+validate_and_strip_version() {
+  local var_name=$1
+  local version=${!var_name}
+  # Strip leading 'v' if present
+  version=${version#v}
+  if [[ ! $version =~ ^[0-9]+\.[0-9]+\.[0-9]+$ ]]; then
+    echo "Invalid version: $version. Must be a semantic version (e.g., 1.2.3)."
+    exit 1
+  fi
+  eval "$var_name='$version'"
+}
+
+# Parse named arguments
+while [[ "$#" -gt 0 ]]; do
+  case $1 in
+    --current_beta) current_beta="$2"; shift ;;
+    --current_stable) current_stable="$2"; shift ;;
+    --next_beta) next_beta="$2"; shift ;;
+    --next_stable) next_stable="$2"; shift ;;
+    *) echo "Unknown parameter passed: $1"; usage ;;
+  esac
+  shift
+done
+
+# Check if at least one of the required arguments is provided
+if [ -z "$current_beta" ] && [ -z "$current_stable" ]; then
+  usage
+fi
+
+# Validate and strip versions
+if [ -n "$current_beta" ]; then
+  validate_and_strip_version current_beta
+fi
+if [ -n "$current_stable" ]; then
+  validate_and_strip_version current_stable
+fi
+if [ -n "$next_beta" ]; then
+  validate_and_strip_version next_beta
+fi
+if [ -n "$next_stable" ]; then
+  validate_and_strip_version next_stable
+fi
+
+# Function to bump the minor version and reset patch version to 0
+bump_version() {
+  local version=$1
+  local major
+  major=$(echo "$version" | cut -d. -f1)
+  local minor
+  minor=$(echo "$version" | cut -d. -f2)
+  local new_minor
+  new_minor=$((minor + 1))
+  echo "$major.$new_minor.0"
+}
+
+# Infer the next beta version if not supplied
+if  [ -n "$current_beta" ] && [ -z "$next_beta" ]; then
+  next_beta=$(bump_version "$current_beta")
+fi
+
+# Infer the next stable version if current_stable provided and next version not supplied
+if [ -n "$current_stable" ] && [ -z "$next_stable" ]; then
+  next_stable=$(bump_version "$current_stable")
+fi
+
+
+# List of files to update
+# TODO: Uncomment cmd/builder/builder-config.yaml once PR #671 merged
+files=(
+  "distributions/otelcol-contrib/manifest.yaml"
+  "distributions/otelcol/manifest.yaml"
+  "distributions/otelcol-k8s/manifest.yaml"
+  "distributions/otelcol-otlp/manifest.yaml"
+  "Makefile"
+  # "cmd/builder/builder-config-yaml"
+)
+
+# Update versions in each file
+for file in "${files[@]}"; do
+  if [ -f "$file" ]; then
+    if [ -n "$current_beta" ]; then
+      sed -i.bak "s/$current_beta/$next_beta/g" "$file"
+      echo "Updated $file from $current_beta to $next_beta"
+    fi
+    if [ -n "$current_stable" ]; then
+      sed -i.bak "s/$current_stable/$next_stable/g" "$file"
+      echo "Updated $file from $current_stable to $next_stable"
+    fi
+    rm "${file}.bak"
+  else
+    echo "File $file does not exist"
+  fi
+done
+
+echo "Version update completed."
+
+Commit changes and draft PR
+git config --global user.name "github-actions[bot]"
+git config --global user.email "github-actions[bot]@users.noreply.github.com"
+
+# TODO: Once Collector 1.0 is released, we can remove the beta version logic
+# for commit and PR creation
+if [ -n "$current_beta" ]; then
+  branch_name="update-version-${next_beta}"
+  git checkout -b "$branch_name"
+  git add Makefile \
+    distributions/otelcol/manifest.yaml \
+    distributions/otelcol-contrib/manifest.yaml \
+    distributions/otelcol-k8s/manifest.yaml
+  git commit -m "Update version from $current_beta to $next_beta"
+  git push -u origin "$branch_name"
+  gh pr create --title "[chore] Prepare release $next_beta" \
+    --body "This PR updates the version from $current_beta to $next_beta" \
+    --base main --head "$branch_name" --draft
+else
+  branch_name="update-version-${next_stable}"
+  git checkout -b "$branch_name"
+  git add Makefile \
+    distributions/otelcol/manifest.yaml \
+    distributions/otelcol-contrib/manifest.yaml \
+    distributions/otelcol-k8s/manifest.yaml
+  git commit -m "Update version from $current_stable to $next_stable"
+  git push -u origin "$branch_name"
+  gh pr create --title "[chore] Prepare release $next_stable" \
+    --body "This PR updates the version from $current_stable to $next_stable" \
+    --base main --head "$branch_name" --draft
+fi
+
+echo "Changes committed and PR created."
diff --git a/.github/workflows/update-version.yaml b/.github/workflows/update-version.yaml
new file mode 100644
index 00000000..cbe61f6a
--- /dev/null
+++ b/.github/workflows/update-version.yaml
@@ -0,0 +1,47 @@
+name: Update Version
+on:
+  workflow_dispatch:
+    inputs:
+      current_beta:
+        description: 'Current beta version, e.g. v0.111.0 or 0.111.0'
+        required: false
+        default: ''
+      current_stable:
+        description: 'Current stable version, e.g. v1.16.0 or 1.16.0'
+        required: false
+        default: ''
+      next_beta:
+        description: 'Next beta version (optional)'
+        required: false
+        default: ''
+      next_stable:
+        description: 'Next stable version (optional)'
+        required: false
+        default: ''
+
+jobs:
+  update-version:
+    runs-on: ubuntu-latest
+    env:
+      GH_TOKEN: ${{ secrets.GITHUB_TOKEN }}
+    steps:
+      - name: Validate inputs
+        run: |
+          if [ -z "${{ github.event.inputs.current_beta }}" ] && [ -z "${{ github.event.inputs.current_stable }}" ]; then
+            echo "Error: At least one of 'current_beta' or 'current_stable' must be provided."
+            exit 1
+          fi
+
+      - name: Checkout repository
+        uses: actions/checkout@v2
+
+      - name: Run bump-versions.sh
+        run: |
+          chmod +x .github/workflows/scripts/bump-versions.sh
+          .github/workflows/scripts/bump-versions.sh \
+            --current_beta "${{ github.event.inputs.current_beta }}" \
+            --current_stable "${{ github.event.inputs.current_stable }}" \
+            --next_beta "${{ github.event.inputs.next_beta }}" \
+            --next_stable "${{ github.event.inputs.next_stable }}"
+        env:
+          GH_TOKEN: ${{ secrets.GITHUB_TOKEN }}