diff --git a/.github/workflows/ci.yml b/.github/workflows/ci.yml
index 1b8f33a5..b5e280cd 100644
--- a/.github/workflows/ci.yml
+++ b/.github/workflows/ci.yml
@@ -52,6 +52,7 @@ jobs:
     env:
       PYTHONUTF8: 1
       PYTHONIOENCODING: utf-8
+      BABYLON_DISABLE_TELEMETRY: "true"
     steps:
       - uses: actions/checkout@v6
       - uses: astral-sh/setup-uv@v7
diff --git a/Babylon/commands/macro/init.py b/Babylon/commands/macro/init.py
index af672f7a..db5d3f6e 100644
--- a/Babylon/commands/macro/init.py
+++ b/Babylon/commands/macro/init.py
@@ -4,9 +4,11 @@
 from shutil import copy
 
 from click import command, echo, option, style
+from opentelemetry import trace
 
 from Babylon.utils.environment import Environment
 
+tracer = trace.get_tracer(__name__)
 logger = getLogger(__name__)
 env = Environment()
 
@@ -14,6 +16,7 @@
 @command()
 @option("--project-folder", default="project", help="Name of the project folder to create (default: 'project').")
 @option("--variables-file", default="variables.yaml", help="Name of the variables file (default: 'variables.yaml').")
+@tracer.start_as_current_span("macro_init_command")
 def init(project_folder: str, variables_file: str):
     """
     Scaffolds a new Babylon project structure using YAML templates.
diff --git a/Babylon/main.py b/Babylon/main.py
index d4cd4364..b42fd85a 100644
--- a/Babylon/main.py
+++ b/Babylon/main.py
@@ -14,8 +14,11 @@
 from Babylon.utils.dry_run import display_dry_run
 from Babylon.utils.environment import Environment
 from Babylon.utils.interactive import INTERACTIVE_ARG_VALUE, interactive_run
+from Babylon.utils.telemetry import setup_telemetry
 from Babylon.version import VERSION
 
+trace = setup_telemetry()
+tracer = trace.get_tracer(__name__)
 logger = logging.getLogger()
 logging.getLogger("azure").setLevel(logging.WARNING)
 u_log = logging.getLogger("urllib3")
diff --git a/Babylon/utils/decorators.py b/Babylon/utils/decorators.py
index 6708c290..c1885d91 100644
--- a/Babylon/utils/decorators.py
+++ b/Babylon/utils/decorators.py
@@ -9,6 +9,7 @@
 
 from click import Choice, ClickException, get_current_context, option
 from click import Path as ClickPath
+from opentelemetry import trace
 from rich.console import Console
 from rich.padding import Padding
 from rich.syntax import Syntax
@@ -19,6 +20,7 @@
 from Babylon.utils.response import CommandResponse
 from Babylon.version import get_version
 
+tracer = trace.get_tracer(__name__)
 logger = logging.getLogger("Babylon")
 env = Environment()
 console = Console()
@@ -196,17 +198,19 @@ def wrap_function(func: Callable[..., Any]) -> Callable[..., Any]:
         )
         @wraps(func)
         def wrapper(*args: Any, **kwargs: Any):
-            context = kwargs.pop("context", None)
-            if context and check_special_char(string=context):
-                env.set_context(context)
-            tenant = kwargs.pop("tenant", None)
-            if tenant and check_special_char(string=tenant):
-                env.set_environ(tenant)
-            state_id = kwargs.pop("state_id", None)
-            if state_id and check_special_char(string=state_id):
-                env.set_state_id(state_id)
-            env.get_namespace_from_local(context=context, tenant=tenant, state_id=state_id)
-            return func(*args, **kwargs)
+            span_name = f"{func.__module__}.{func.__qualname__}"
+            with tracer.start_as_current_span(span_name):
+                context = kwargs.pop("context", None)
+                if context and check_special_char(string=context):
+                    env.set_context(context)
+                tenant = kwargs.pop("tenant", None)
+                if tenant and check_special_char(string=tenant):
+                    env.set_environ(tenant)
+                state_id = kwargs.pop("state_id", None)
+                if state_id and check_special_char(string=state_id):
+                    env.set_state_id(state_id)
+                env.get_namespace_from_local(context=context, tenant=tenant, state_id=state_id)
+                return func(*args, **kwargs)
 
         return wrapper
 
diff --git a/Babylon/utils/telemetry.py b/Babylon/utils/telemetry.py
new file mode 100644
index 00000000..f3280388
--- /dev/null
+++ b/Babylon/utils/telemetry.py
@@ -0,0 +1,58 @@
+from logging import getLogger
+from os import getenv
+from sys import platform
+
+from opentelemetry import trace
+from opentelemetry.exporter.otlp.proto.http.trace_exporter import OTLPSpanExporter
+from opentelemetry.sdk.resources import OS_TYPE, SERVICE_NAME, SERVICE_VERSION, Resource
+from opentelemetry.sdk.trace import TracerProvider
+from opentelemetry.sdk.trace.export import BatchSpanProcessor
+from requests import get
+
+from Babylon.version import VERSION
+
+logger = getLogger(__name__)
+
+
+def setup_telemetry() -> trace.Tracer:
+    """Prepare telemetry configuration. Two environment variables are used to configure telemetry:
+    - BABYLON_DISABLE_TELEMETRY: If set to "true", telemetry is disabled.
+    - OTEL_EXPORTER_OTLP_ENDPOINT: Specifies the endpoint to which telemetry data is sent.
+
+    Returns:
+        trace.Tracer: The configured tracer instance.
+    """
+
+    if getenv("BABYLON_DISABLE_TELEMETRY", "false").lower() == "true":
+        logger.info("Telemetry is disabled")
+        return trace
+
+    endpoint = getenv("OTEL_EXPORTER_OTLP_ENDPOINT", "http://telemetry.westeurope.azurecontainer.io:4318/v1/traces")
+
+    try:
+        get(endpoint, timeout=2)
+    except Exception as e:
+        logger.warning(f"Telemetry endpoint {endpoint} is not reachable: {e}. Continuing without telemetry.")
+        return trace
+
+    resource = Resource.create(
+        attributes={
+            SERVICE_NAME: "Babylon",
+            SERVICE_VERSION: VERSION,
+            OS_TYPE: platform,
+        }
+    )
+
+    try:
+        otlp_exporter = OTLPSpanExporter(
+            endpoint=endpoint,
+            timeout=2,
+        )
+        span_processor = BatchSpanProcessor(otlp_exporter, export_timeout_millis=5000)
+        trace.set_tracer_provider(TracerProvider(resource=resource))
+        trace.get_tracer_provider().add_span_processor(span_processor)
+    except Exception as e:
+        logger.warning(f"Telemetry setup failed: {e}. Continuing without telemetry.")
+        trace.set_tracer_provider(TracerProvider())
+
+    return trace
diff --git a/README.md b/README.md
index f80ec036..7f96a561 100644
--- a/README.md
+++ b/README.md
@@ -76,4 +76,7 @@ To release a new version follow the checklist:
 - Generate lock file `uv lock`
 - Make a git tag, `git tag -a -m "5.0.0-beta.2" 5.0.0-beta.2`
 - Push the tag `git push tag 5.0.0-beta.2`
-- Write release notes publish on [GitHub](https://github.com/Cosmo-Tech/Babylon/releases)
\ No newline at end of file
+- Write release notes publish on [GitHub](https://github.com/Cosmo-Tech/Babylon/releases)
+
+## Data Collection
+Telemetry configuration is on by default, to opt out set the environment variable BABYLON_DISABLE_TELEMETRY to false. No personal identifiable information is collected. Our privacy statement is located at [Cosmo-Tech](https://cosmotech.com/privacy-policy/)
\ No newline at end of file
diff --git a/pyproject.toml b/pyproject.toml
index 73ca2c2c..465590e1 100644
--- a/pyproject.toml
+++ b/pyproject.toml
@@ -23,8 +23,12 @@ dependencies = [
   "flatten_json",
   "dynaconf",
   "azure-mgmt-authorization>=4.0.0",
+  "azure-containerregistry>=1.2.0",
   "kubernetes>=35.0.0",
-  "cosmotech-api==5.0.0rc4"
+  "cosmotech-api==5.0.0rc4",
+  "opentelemetry-api",
+  "opentelemetry-sdk",
+  "opentelemetry-exporter-otlp"
 ]
 dynamic = ["version"]
 readme = {file = "README.md", content-type = "text/markdown"}