diff --git a/CHANGELOG.md b/CHANGELOG.md
index 1d75f0e2de7..0012227642e 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -13,6 +13,7 @@
 **Internal**:
 
 - Bump `sentry-conventions` to 0.6.0-4. ([#5944](https://github.com/getsentry/relay/pull/5944))
+- Enable compression for forwarded uploads. ([#5965](https://github.com/getsentry/relay/pull/5965))
 
 ## 26.4.2
 
diff --git a/Cargo.lock b/Cargo.lock
index 2adc33800e1..c849b59921b 100644
--- a/Cargo.lock
+++ b/Cargo.lock
@@ -4912,6 +4912,7 @@ dependencies = [
  "ahash",
  "anyhow",
  "arc-swap",
+ "async-compression",
  "axum",
  "axum-extra",
  "axum-server",
diff --git a/Cargo.toml b/Cargo.toml
index 957383369c4..bbb9505f4bf 100644
--- a/Cargo.toml
+++ b/Cargo.toml
@@ -90,6 +90,7 @@ android_trace_log = { version = "0.3", features = ["serde"] }
 # Keep it pinned until it's possible to disable backtrace.
 anyhow = "=1.0.69"
 arc-swap = "1"
+async-compression = { version = "0.4", features = ["tokio", "gzip", "brotli", "deflate", "zstd"] }
 async-trait = "0.1"
 axum = "0.8"
 axum-extra = "0.12"
diff --git a/relay-server/Cargo.toml b/relay-server/Cargo.toml
index 13cbe16e25c..54b1e19f6b6 100644
--- a/relay-server/Cargo.toml
+++ b/relay-server/Cargo.toml
@@ -32,6 +32,7 @@ workspace = true
 ahash = { workspace = true }
 anyhow = { workspace = true }
 arc-swap = { workspace = true }
+async-compression = { workspace = true }
 axum = { workspace = true, features = ["macros", "matched-path", "tracing"] }
 axum-extra = { workspace = true }
 axum-server = { workspace = true }
diff --git a/relay-server/src/services/upload.rs b/relay-server/src/services/upload.rs
index 78788bbbcfd..f678ff51fbd 100644
--- a/relay-server/src/services/upload.rs
+++ b/relay-server/src/services/upload.rs
@@ -4,9 +4,11 @@ use std::fmt;
 use std::sync::Arc;
 use std::time::Duration;
 
+use async_compression::tokio::bufread::{BrotliEncoder, DeflateEncoder, GzipEncoder, ZstdEncoder};
 use bytes::Bytes;
 use chrono::DateTime;
 use chrono::Utc;
+use futures::StreamExt;
 use futures::stream::BoxStream;
 use http::{HeaderValue, Method};
 use relay_auth::Signature;
@@ -14,14 +16,17 @@ use relay_auth::Signature;
 use relay_auth::SignatureHeader;
 use relay_base_schema::project::ProjectId;
 use relay_config::Config;
+use relay_config::HttpEncoding;
 use relay_quotas::Scoping;
 use relay_system::{
     Addr, AsyncResponse, ConcurrentService, FromMessage, Interface, LoadShed, SendError, Sender,
     SimpleService,
 };
 use serde::Deserialize;
+use tokio::io::BufReader;
 use tokio::sync::oneshot;
 use tokio::sync::oneshot::error::RecvError;
+use tokio_util::io::{ReaderStream, StreamReader};
 #[cfg(feature = "processing")]
 use uuid::Uuid;
 
@@ -458,6 +463,7 @@ enum RequestKind {
     Upload {
         location: SignedLocation,
         stream: Option<BoundedStream<MeteredStream<ByteStream>>>,
+        encoding: HttpEncoding,
     },
 }
 
@@ -508,6 +514,7 @@ impl UploadRequest {
                 kind: RequestKind::Upload {
                     location,
                     stream: Some(stream),
+                    encoding: HttpEncoding::Zstd, // just a default, will be overwritten by .configure()
                 },
                 sender,
             },
@@ -579,12 +586,19 @@ impl UpstreamRequest for UploadRequest {
 
     fn build(&mut self, builder: &mut RequestBuilder) -> Result<(), HttpError> {
         let upload_length = self.length();
-        if let RequestKind::Upload { stream, .. } = &mut self.kind {
+        if let RequestKind::Upload {
+            stream, encoding, ..
+        } = &mut self.kind
+        {
             let Some(body) = stream.take() else {
                 relay_log::error!("upload request was retried or never initialized");
                 return Err(HttpError::Misconfigured);
             };
             tus::add_upload_headers(builder);
+
+            let body = encode_body(body, *encoding);
+            builder.content_encoding(*encoding);
+
             builder.body(reqwest::Body::wrap_stream(body));
         } else {
             tus::add_creation_headers(upload_length, builder);
@@ -596,4 +610,24 @@ impl UpstreamRequest for UploadRequest {
 
         Ok(())
     }
+
+    fn configure(&mut self, config: &Config) {
+        if let RequestKind::Upload { encoding, .. } = &mut self.kind {
+            *encoding = config.http_encoding();
+        }
+    }
+}
+
+fn encode_body<S>(stream: S, encoding: HttpEncoding) -> ByteStream
+where
+    S: futures::Stream<Item = std::io::Result<Bytes>> + Send + 'static,
+{
+    let reader = BufReader::new(StreamReader::new(stream));
+    match encoding {
+        HttpEncoding::Identity => ReaderStream::new(reader).boxed(),
+        HttpEncoding::Deflate => ReaderStream::new(DeflateEncoder::new(reader)).boxed(),
+        HttpEncoding::Gzip => ReaderStream::new(GzipEncoder::new(reader)).boxed(),
+        HttpEncoding::Br => ReaderStream::new(BrotliEncoder::new(reader)).boxed(),
+        HttpEncoding::Zstd => ReaderStream::new(ZstdEncoder::new(reader)).boxed(),
+    }
 }
diff --git a/tests/integration/conftest.py b/tests/integration/conftest.py
index a9d51be15c7..2855ccd073b 100644
--- a/tests/integration/conftest.py
+++ b/tests/integration/conftest.py
@@ -5,7 +5,7 @@
 from typing import Optional
 import json
 import redis
-from flask import Response
+from flask import Response, request
 
 import pytest
 
@@ -47,7 +47,7 @@
     objectstore,
 )
 
-from .consts import DUMMY_UPLOAD_LOCATION
+from .consts import DUMMY_UPLOAD_LOCATION, ZSTD_MAGIC_HEADER
 
 
 @pytest.fixture(scope="session")
@@ -314,6 +314,8 @@ def create(**opts):
 
     @mini_sentry.app.route("/api/<project>/upload/<key>/", methods=["PATCH"])
     def upload(**opts):
+        assert request.headers["Content-Encoding"] == "zstd"
+        assert request.data.startswith(ZSTD_MAGIC_HEADER)
         return Response(
             "",
             status=204,
diff --git a/tests/integration/consts.py b/tests/integration/consts.py
index 0359eb0c602..5846cbb5081 100644
--- a/tests/integration/consts.py
+++ b/tests/integration/consts.py
@@ -3,3 +3,5 @@
 
 DUMMY_UPLOAD_PATH = "/api/42/upload/019cdc82ed6c7761ba21fd34b86481c2/"
 DUMMY_UPLOAD_LOCATION = f"{DUMMY_UPLOAD_PATH}?length=11&signature=z_fUMhT0EZqJz6OQtwGHqTlOOLPpTVpvPa-rYTg18FVWZM1OGny-LeVJB5H-sSR_5e--I1xt-FlCmRG2bsmcAQ.eyJ0IjoiMjAyNi0wMy0xMVQxMDo0ODoxMy45NDM1ODNaIn0"
+
+ZSTD_MAGIC_HEADER = b"\x28\xb5\x2f\xfd"