diff --git a/src/rpc/rawtransaction.cpp b/src/rpc/rawtransaction.cpp
index 7fe73e56da..2adfd0c0fc 100644
--- a/src/rpc/rawtransaction.cpp
+++ b/src/rpc/rawtransaction.cpp
@@ -1691,6 +1691,70 @@ UniValue converttopsbt(const JSONRPCRequest& request)
     return EncodeBase64((unsigned char*)ssTx.data(), ssTx.size());
 }
 
+UniValue utxoupdatepsbt(const JSONRPCRequest& request)
+{
+    if (request.fHelp || request.params.size() != 1) {
+        throw std::runtime_error(
+            RPCHelpMan{"utxoupdatepsbt",
+            "\nUpdates a PSBT with witness UTXOs retrieved from the UTXO set or the mempool.\n",
+            {
+                {"psbt", RPCArg::Type::STR, RPCArg::Optional::NO, "A base64 string of a PSBT"}
+            },
+            RPCResult {
+                "  \"psbt\"          (string) The base64-encoded partially signed transaction with inputs updated\n"
+            },
+            RPCExamples {
+                HelpExampleCli("utxoupdatepsbt", "\"psbt\"")
+            }}.ToString());
+    }
+
+    RPCTypeCheck(request.params, {UniValue::VSTR}, true);
+
+    // Unserialize the transactions
+    PartiallySignedTransaction psbtx;
+    std::string error;
+    if (!DecodeBase64PSBT(psbtx, request.params[0].get_str(), error)) {
+        throw JSONRPCError(RPC_DESERIALIZATION_ERROR, strprintf("TX decode failed %s", error));
+    }
+
+    // Fetch previous transactions (inputs):
+    CCoinsView viewDummy;
+    CCoinsViewCache view(&viewDummy);
+    {
+        LOCK2(cs_main, mempool.cs);
+        CCoinsViewCache &viewChain = *pcoinsTip;
+        CCoinsViewMemPool viewMempool(&viewChain, mempool);
+        view.SetBackend(viewMempool); // temporarily switch cache backend to db+mempool view
+
+        for (const CTxIn& txin : psbtx.tx->vin) {
+            view.AccessCoin(txin.prevout); // Load entries from viewChain into view; can fail.
+        }
+
+        view.SetBackend(viewDummy); // switch back to avoid locking mempool for too long
+    }
+
+    // Fill the inputs
+    for (unsigned int i = 0; i < psbtx.tx->vin.size(); ++i) {
+        PSBTInput& input = psbtx.inputs.at(i);
+
+        if (input.non_witness_utxo || !input.witness_utxo.IsNull()) {
+            continue;
+        }
+
+        const Coin& coin = view.AccessCoin(psbtx.tx->vin[i].prevout);
+
+        std::vector<std::vector<unsigned char>> solutions_data;
+        txnouttype which_type = Solver(coin.out.scriptPubKey, solutions_data);
+        if (which_type == TX_WITNESS_V0_SCRIPTHASH || which_type == TX_WITNESS_V0_KEYHASH || which_type == TX_WITNESS_UNKNOWN) {
+            input.witness_utxo = coin.out;
+        }
+    }
+
+    CDataStream ssTx(SER_NETWORK, PROTOCOL_VERSION);
+    ssTx << psbtx;
+    return EncodeBase64((unsigned char*)ssTx.data(), ssTx.size());
+}
+
 // clang-format off
 static const CRPCCommand commands[] =
 { //  category              name                            actor (function)            argNames
@@ -1709,6 +1773,7 @@ static const CRPCCommand commands[] =
     { "rawtransactions",    "finalizepsbt",                 &finalizepsbt,              {"psbt", "extract"} },
     { "rawtransactions",    "createpsbt",                   &createpsbt,                {"inputs","outputs","locktime","replaceable"} },
     { "rawtransactions",    "converttopsbt",                &converttopsbt,             {"hexstring","permitsigdata","iswitness"} },
+    { "rawtransactions",    "utxoupdatepsbt",               &utxoupdatepsbt,            {"psbt"} },
 
     { "blockchain",         "gettxoutproof",                &gettxoutproof,             {"txids", "blockhash"} },
     { "blockchain",         "verifytxoutproof",             &verifytxoutproof,          {"proof"} },
diff --git a/test/functional/rpc_psbt.py b/test/functional/rpc_psbt.py
index c98f105828..28507267ce 100755
--- a/test/functional/rpc_psbt.py
+++ b/test/functional/rpc_psbt.py
@@ -20,7 +20,7 @@ def set_test_params(self):
         self.setup_clean_chain = False
         self.num_nodes = 3
        # TODO: remove -txindex. Currently required for getrawtransaction call.
-        self.extra_args = [[], ["-txindex"], ["-txindex"]]
+        self.extra_args = [["-txindex"], ["-txindex"], ["-txindex"]]
 
     def skip_test_if_missing_module(self):
         self.skip_if_no_wallet()
@@ -296,5 +296,32 @@ def run_test(self):
         # Test decoding error: invalid base64
         assert_raises_rpc_error(-22, "TX decode failed invalid base64", self.nodes[0].decodepsbt, ";definitely not base64;")
 
+        # Send to all types of addresses
+        addr1 = self.nodes[1].getnewaddress("", "bech32")
+        txid1 = self.nodes[0].sendtoaddress(addr1, 11)
+        vout1 = find_output(self.nodes[0], txid1, 11)
+        addr2 = self.nodes[1].getnewaddress("", "legacy")
+        txid2 = self.nodes[0].sendtoaddress(addr2, 11)
+        vout2 = find_output(self.nodes[0], txid2, 11)
+        addr3 = self.nodes[1].getnewaddress("", "p2sh-segwit")
+        txid3 = self.nodes[0].sendtoaddress(addr3, 11)
+        vout3 = find_output(self.nodes[0], txid3, 11)
+        self.sync_all()
+
+        # Update a PSBT with UTXOs from the node
+        # Bech32 inputs should be filled with witness UTXO. Other inputs should not be filled because they are non-witness
+        psbt = self.nodes[1].createpsbt([{"txid":txid1, "vout":vout1},{"txid":txid2, "vout":vout2},{"txid":txid3, "vout":vout3}], {self.nodes[0].getnewaddress():32.999})
+        decoded = self.nodes[1].decodepsbt(psbt)
+        assert "witness_utxo" not in decoded['inputs'][0] and "non_witness_utxo" not in decoded['inputs'][0]
+        assert "witness_utxo" not in decoded['inputs'][1] and "non_witness_utxo" not in decoded['inputs'][1]
+        assert "witness_utxo" not in decoded['inputs'][2] and "non_witness_utxo" not in decoded['inputs'][2]
+        updated = self.nodes[1].utxoupdatepsbt(psbt)
+        decoded = self.nodes[1].decodepsbt(updated)
+        assert "witness_utxo" in decoded['inputs'][0] and "non_witness_utxo" not in decoded['inputs'][0]
+        assert "witness_utxo" not in decoded['inputs'][1] and "non_witness_utxo" not in decoded['inputs'][1]
+        assert "witness_utxo" not in decoded['inputs'][2] and "non_witness_utxo" not in decoded['inputs'][2]
+
+
+
 if __name__ == '__main__':
     PSBTTest().main()