diff --git a/.changelog/22077.txt b/.changelog/22077.txt
new file mode 100644
index 00000000000..a0177ace1ae
--- /dev/null
+++ b/.changelog/22077.txt
@@ -0,0 +1,3 @@
+```release-note:bug
+resource/aws_appstream_image_builder: Correctly create resource with `image_arn` argument
+```
\ No newline at end of file
diff --git a/internal/service/appstream/image_builder.go b/internal/service/appstream/image_builder.go
index a0d713f065d..04704d2ce16 100644
--- a/internal/service/appstream/image_builder.go
+++ b/internal/service/appstream/image_builder.go
@@ -116,6 +116,7 @@ func ResourceImageBuilder() *schema.Resource {
 				Computed:     true,
 				ForceNew:     true,
 				ExactlyOneOf: []string{"image_arn", "image_name"},
+				ValidateFunc: verify.ValidARN,
 			},
 			"image_name": {
 				Type:         schema.TypeString,
@@ -204,6 +205,10 @@ func resourceImageBuilderCreate(ctx context.Context, d *schema.ResourceData, met
 		input.EnableDefaultInternetAccess = aws.Bool(v.(bool))
 	}
 
+	if v, ok := d.GetOk("image_arn"); ok {
+		input.ImageArn = aws.String(v.(string))
+	}
+
 	if v, ok := d.GetOk("image_name"); ok {
 		input.ImageName = aws.String(v.(string))
 	}
diff --git a/internal/service/appstream/image_builder_test.go b/internal/service/appstream/image_builder_test.go
index 88716a3731e..7518ad8475b 100644
--- a/internal/service/appstream/image_builder_test.go
+++ b/internal/service/appstream/image_builder_test.go
@@ -166,6 +166,36 @@ func TestAccAppStreamImageBuilder_tags(t *testing.T) {
 	})
 }
 
+func TestAccAppStreamImageBuilder_imageARN(t *testing.T) {
+	resourceName := "aws_appstream_image_builder.test"
+	// imageName selected from the available AWS Managed AppStream 2.0 Base Images
+	// Reference: https://docs.aws.amazon.com/appstream2/latest/developerguide/base-image-version-history.html
+	imageName := "AppStream-WinServer2012R2-07-19-2021"
+	instanceType := "stream.standard.small"
+	rName := sdkacctest.RandomWithPrefix(acctest.ResourcePrefix)
+
+	resource.ParallelTest(t, resource.TestCase{
+		PreCheck:          func() { acctest.PreCheck(t) },
+		ProviderFactories: acctest.ProviderFactories,
+		CheckDestroy:      testAccCheckImageBuilderDestroy,
+		ErrorCheck:        acctest.ErrorCheck(t, appstream.EndpointsID),
+		Steps: []resource.TestStep{
+			{
+				Config: testAccImageBuilderByImageARNConfig(rName, imageName, instanceType),
+				Check: resource.ComposeTestCheckFunc(
+					testAccCheckImageBuilderExists(resourceName),
+					acctest.CheckResourceAttrRegionalARNNoAccount(resourceName, "image_arn", "appstream", fmt.Sprintf("image/%s", imageName)),
+				),
+			},
+			{
+				ResourceName:      resourceName,
+				ImportState:       true,
+				ImportStateVerify: true,
+			},
+		},
+	})
+}
+
 func testAccCheckImageBuilderExists(resourceName string) resource.TestCheckFunc {
 	return func(s *terraform.State) error {
 		rs, ok := s.RootModule().Resources[resourceName]
@@ -280,3 +310,15 @@ resource "aws_appstream_image_builder" "test" {
 }
 `, instanceType, name, key1, value1, key2, value2)
 }
+
+func testAccImageBuilderByImageARNConfig(rName, imageName, instanceType string) string {
+	return fmt.Sprintf(`
+data "aws_partition" "current" {}
+
+resource "aws_appstream_image_builder" "test" {
+  image_arn     = "arn:${data.aws_partition.current.partition}:appstream:%[1]s::image/%[2]s"
+  instance_type = %[3]q
+  name          = %[4]q
+}
+`, acctest.Region(), imageName, instanceType, rName)
+}