diff --git a/.github/workflows/ci.yml b/.github/workflows/ci.yml
index 8a3a1811d..f6827de32 100644
--- a/.github/workflows/ci.yml
+++ b/.github/workflows/ci.yml
@@ -134,6 +134,33 @@ jobs:
           PGX_SSL_PASSWORD: ${{ matrix.pgx-ssl-password }}
           PGX_TEST_TLS_CLIENT_CONN_STRING: ${{ matrix.pgx-test-tls-client-conn-string }}
 
+  test-pgbouncer:
+    name: Test PgBouncer with PostgreSQL 18
+    runs-on: ubuntu-22.04
+
+    steps:
+      - name: Check out code into the Go module directory
+        uses: actions/checkout@v5
+
+      - name: Set up Go 1.26
+        uses: actions/setup-go@v6
+        with:
+          go-version: "1.26"
+
+      - name: Set up PostgreSQL 18
+        run: ci/setup_test.bash
+        env:
+          PGVERSION: "18"
+
+      - name: Set up PgBouncer
+        run: ci/setup_pgbouncer.bash
+
+      - name: Test PgBouncer
+        run: go test -parallel=1 -race -count=1 -run 'TestPgbouncer|TestConnContextCanceledCancelsRunningQueryOnServer' ./...
+        env:
+          PGX_TEST_DATABASE: "host=127.0.0.1 user=pgx_md5 password=secret dbname=pgx_test"
+          PGX_TEST_PGBOUNCER_CONN_STRING: "host=127.0.0.1 port=6432 user=pgx_md5 password=secret dbname=pgx_test"
+
   test-windows:
     name: Test Windows
     runs-on: windows-latest
diff --git a/CONTRIBUTING.md b/CONTRIBUTING.md
index 2283ae670..9a8d1b020 100644
--- a/CONTRIBUTING.md
+++ b/CONTRIBUTING.md
@@ -130,6 +130,9 @@ psql --no-psqlrc -f testsetup/postgresql_setup.sql
 ### PgBouncer
 
 There are tests specific for PgBouncer that will be executed if `PGX_TEST_PGBOUNCER_CONN_STRING` is set.
+The test PgBouncer must be version 1.21.0 or newer, use transaction pooling, and have `max_prepared_statements` set to a
+non-zero value. This ensures the tests cover PgBouncer's protocol-level named prepared statement support in addition to
+the pgx query modes that do not use named prepared statements.
 
 ### Optional Tests
 
diff --git a/ci/setup_pgbouncer.bash b/ci/setup_pgbouncer.bash
new file mode 100755
index 000000000..18271aa13
--- /dev/null
+++ b/ci/setup_pgbouncer.bash
@@ -0,0 +1,20 @@
+#!/usr/bin/env bash
+set -euxo pipefail
+
+sudo apt-get install -y pgbouncer
+sudo systemctl stop pgbouncer
+
+sudo install -o postgres -g postgres -m 0750 -d /etc/pgbouncer
+sudo install -o postgres -g postgres -m 0640 testsetup/pgbouncer.ini /etc/pgbouncer/pgbouncer.ini
+sudo install -o postgres -g postgres -m 0640 testsetup/pgbouncer-userlist.txt /etc/pgbouncer/userlist.txt
+sudo -u postgres pgbouncer -d /etc/pgbouncer/pgbouncer.ini
+
+for _ in {1..30}; do
+  if PGPASSWORD=secret psql "host=127.0.0.1 port=6432 user=pgx_md5 dbname=pgx_test" -c "select 1"; then
+    exit 0
+  fi
+  sleep 1
+done
+
+sudo cat /var/log/postgresql/pgbouncer.log || true
+exit 1
diff --git a/conn.go b/conn.go
index 1f31c40fc..7067bfd45 100644
--- a/conn.go
+++ b/conn.go
@@ -36,9 +36,10 @@ type ConnConfig struct {
 	DescriptionCacheCapacity int
 
 	// DefaultQueryExecMode controls the default mode for executing queries. By default pgx uses the extended protocol
-	// and automatically prepares and caches prepared statements. However, this may be incompatible with proxies such as
-	// PGBouncer. In this case it may be preferable to use [QueryExecModeExec] or [QueryExecModeSimpleProtocol]. The same
-	// functionality can be controlled on a per query basis by passing a [QueryExecMode] as the first query argument.
+	// and automatically prepares and caches prepared statements. This may be incompatible with proxies such as PgBouncer
+	// unless they are configured to support protocol-level prepared statements. In an incompatible configuration it may
+	// be preferable to use [QueryExecModeExec] or [QueryExecModeSimpleProtocol]. The same functionality can be controlled
+	// on a per query basis by passing a [QueryExecMode] as the first query argument.
 	DefaultQueryExecMode QueryExecMode
 
 	createdByParseConfig bool // Used to enforce created by ParseConfig rule.
diff --git a/doc.go b/doc.go
index 5e4870191..f20b3f68f 100644
--- a/doc.go
+++ b/doc.go
@@ -210,8 +210,18 @@ implemented on top of [pgconn.PgConn]. The [Conn.PgConn] method can be used to a
 
 PgBouncer
 
-By default pgx automatically uses prepared statements. Prepared statements are incompatible with PgBouncer. This can be
-disabled by setting a different [QueryExecMode] in [ConnConfig.DefaultQueryExecMode].
+By default pgx automatically uses protocol-level named prepared statements. PgBouncer 1.21.0 and newer can use these
+prepared statements in transaction and statement pooling modes when its max_prepared_statements setting is greater than
+zero. In this configuration the default [QueryExecModeCacheStatement] mode may be used. See the PgBouncer documentation
+for limitations and configuration details: https://www.pgbouncer.org/config.html#max_prepared_statements.
+
+When using an older PgBouncer version or when prepared statement support is disabled, set
+[ConnConfig.DefaultQueryExecMode] to [QueryExecModeExec]. [QueryExecModeCacheDescribe] and
+[QueryExecModeSimpleProtocol] are also compatible with PgBouncer. Prefer [QueryExecModeExec] over
+[QueryExecModeSimpleProtocol] whenever possible. Do not use [QueryExecModeDescribeExec] with transaction pooling because
+PgBouncer may assign a different server connection between the describe and execute steps.
+
+SQL-level prepared statements created with PREPARE are not supported by PgBouncer in transaction pooling mode.
 */
 package pgx
 
diff --git a/pgbouncer_test.go b/pgbouncer_test.go
index 13d07f34c..bbdb1d9bb 100644
--- a/pgbouncer_test.go
+++ b/pgbouncer_test.go
@@ -2,74 +2,169 @@ package pgx_test
 
 import (
 	"context"
+	"errors"
+	"fmt"
 	"os"
 	"testing"
+	"time"
 
 	"github.com/jackc/pgx/v5"
-	"github.com/stretchr/testify/assert"
 	"github.com/stretchr/testify/require"
+	"golang.org/x/sync/errgroup"
 )
 
-func TestPgbouncerStatementCacheDescribe(t *testing.T) {
+func TestPgbouncerQueryExecModes(t *testing.T) {
 	connString := os.Getenv("PGX_TEST_PGBOUNCER_CONN_STRING")
 	if connString == "" {
 		t.Skipf("Skipping due to missing environment variable %v", "PGX_TEST_PGBOUNCER_CONN_STRING")
 	}
 
-	config := mustParseConfig(t, connString)
-	config.DefaultQueryExecMode = pgx.QueryExecModeCacheDescribe
-	config.DescriptionCacheCapacity = 1024
+	tests := []struct {
+		name                     string
+		mode                     pgx.QueryExecMode
+		statementCacheCapacity   int
+		descriptionCacheCapacity int
+	}{
+		{
+			name:                   "cache statement",
+			mode:                   pgx.QueryExecModeCacheStatement,
+			statementCacheCapacity: 32,
+		},
+		{
+			name:                     "cache describe",
+			mode:                     pgx.QueryExecModeCacheDescribe,
+			descriptionCacheCapacity: 32,
+		},
+		{
+			name: "exec",
+			mode: pgx.QueryExecModeExec,
+		},
+		{
+			name: "simple protocol",
+			mode: pgx.QueryExecModeSimpleProtocol,
+		},
+	}
 
-	testPgbouncer(t, config, 10, 100)
+	for _, tt := range tests {
+		t.Run(tt.name, func(t *testing.T) {
+			config := mustParseConfig(t, connString)
+			config.DefaultQueryExecMode = tt.mode
+			config.StatementCacheCapacity = tt.statementCacheCapacity
+			config.DescriptionCacheCapacity = tt.descriptionCacheCapacity
+
+			testPgbouncer(t, config, 10, 100)
+		})
+	}
 }
 
-func TestPgbouncerSimpleProtocol(t *testing.T) {
+func TestPgbouncerStatementCacheEviction(t *testing.T) {
 	connString := os.Getenv("PGX_TEST_PGBOUNCER_CONN_STRING")
 	if connString == "" {
 		t.Skipf("Skipping due to missing environment variable %v", "PGX_TEST_PGBOUNCER_CONN_STRING")
 	}
 
 	config := mustParseConfig(t, connString)
-	config.DefaultQueryExecMode = pgx.QueryExecModeSimpleProtocol
+	config.DefaultQueryExecMode = pgx.QueryExecModeCacheStatement
+	config.StatementCacheCapacity = 8
 
-	testPgbouncer(t, config, 10, 100)
+	conn, err := pgx.ConnectConfig(t.Context(), config)
+	require.NoError(t, err)
+	defer conn.Close(t.Context())
+
+	for i := range 200 {
+		sql := fmt.Sprintf("select $1::int4 /* statement cache eviction %d */", i)
+		var n int32
+		err := conn.QueryRow(t.Context(), sql, int32(i)).Scan(&n)
+		require.NoError(t, err)
+		require.EqualValues(t, i, n)
+	}
 }
 
 func testPgbouncer(t *testing.T, config *pgx.ConnConfig, workers, iterations int) {
-	doneChan := make(chan struct{})
+	ctx, cancel := context.WithTimeout(t.Context(), 2*time.Minute)
+	defer cancel()
+
+	eg, ctx := errgroup.WithContext(ctx)
 
 	for range workers {
-		go func() {
-			defer func() { doneChan <- struct{}{} }()
-			conn, err := pgx.ConnectConfig(context.Background(), config)
-			require.Nil(t, err)
-			defer closeConn(t, conn)
-
-			for range iterations {
-				var i32 int32
-				var i64 int64
-				var f32 float32
-				var s string
-				var s2 string
-				err = conn.QueryRow(context.Background(), "select 1::int4, 2::int8, 3::float4, 'hi'::text").Scan(&i32, &i64, &f32, &s)
-				require.NoError(t, err)
-				assert.Equal(t, int32(1), i32)
-				assert.Equal(t, int64(2), i64)
-				assert.Equal(t, float32(3), f32)
-				assert.Equal(t, "hi", s)
-
-				err = conn.QueryRow(context.Background(), "select 1::int8, 2::float4, 'bye'::text, 4::int4, 'whatever'::text").Scan(&i64, &f32, &s, &i32, &s2)
-				require.NoError(t, err)
-				assert.Equal(t, int64(1), i64)
-				assert.Equal(t, float32(2), f32)
-				assert.Equal(t, "bye", s)
-				assert.Equal(t, int32(4), i32)
-				assert.Equal(t, "whatever", s2)
+		eg.Go(func() (err error) {
+			conn, err := pgx.ConnectConfig(ctx, config)
+			if err != nil {
+				return err
 			}
-		}()
+			defer func() {
+				err = errors.Join(err, conn.Close(ctx))
+			}()
+
+			return exercisePgbouncerConn(ctx, conn, iterations)
+		})
 	}
 
-	for range workers {
-		<-doneChan
+	require.NoError(t, eg.Wait())
+}
+
+func exercisePgbouncerConn(ctx context.Context, conn *pgx.Conn, iterations int) error {
+	for i := range iterations {
+		var i32 int32
+		var i64 int64
+		var f32 float32
+		var s string
+
+		err := conn.QueryRow(ctx, "select $1::int4, $2::int8, $3::float4, $4::text", int32(i), int64(i+1), float32(i+2), "hi").Scan(&i32, &i64, &f32, &s)
+		if err != nil {
+			return err
+		}
+		if i32 != int32(i) || i64 != int64(i+1) || f32 != float32(i+2) || s != "hi" {
+			return fmt.Errorf("unexpected query result: %d, %d, %f, %q", i32, i64, f32, s)
+		}
+	}
+
+	commandTag, err := conn.Exec(ctx, "select $1::int4", int32(42))
+	if err != nil {
+		return err
 	}
+	if commandTag.String() != "SELECT 1" {
+		return fmt.Errorf("unexpected command tag: %s", commandTag)
+	}
+
+	tx, err := conn.Begin(ctx)
+	if err != nil {
+		return err
+	}
+	var txValue int32
+	if err := tx.QueryRow(ctx, "select $1::int4", int32(43)).Scan(&txValue); err != nil {
+		_ = tx.Rollback(ctx)
+		return err
+	}
+	if txValue != 43 {
+		_ = tx.Rollback(ctx)
+		return fmt.Errorf("unexpected transaction query result: %d", txValue)
+	}
+	if err := tx.Commit(ctx); err != nil {
+		return err
+	}
+
+	batch := &pgx.Batch{}
+	batch.Queue("select $1::int4", int32(44))
+	batch.Queue("select $1::text", "batch")
+	batchResults := conn.SendBatch(ctx, batch)
+
+	var batchInt int32
+	if err := batchResults.QueryRow().Scan(&batchInt); err != nil {
+		_ = batchResults.Close()
+		return err
+	}
+	var batchText string
+	if err := batchResults.QueryRow().Scan(&batchText); err != nil {
+		_ = batchResults.Close()
+		return err
+	}
+	if err := batchResults.Close(); err != nil {
+		return err
+	}
+	if batchInt != 44 || batchText != "batch" {
+		return fmt.Errorf("unexpected batch query results: %d, %q", batchInt, batchText)
+	}
+
+	return nil
 }
diff --git a/testsetup/pgbouncer-userlist.txt b/testsetup/pgbouncer-userlist.txt
new file mode 100644
index 000000000..97092ec2c
--- /dev/null
+++ b/testsetup/pgbouncer-userlist.txt
@@ -0,0 +1 @@
+"pgx_md5" "secret"
diff --git a/testsetup/pgbouncer.ini b/testsetup/pgbouncer.ini
new file mode 100644
index 000000000..30f0c3481
--- /dev/null
+++ b/testsetup/pgbouncer.ini
@@ -0,0 +1,22 @@
+[databases]
+pgx_test = host=127.0.0.1 port=5432 dbname=pgx_test user=pgx_md5 password=secret
+
+[pgbouncer]
+listen_addr = 127.0.0.1
+listen_port = 6432
+unix_socket_dir = /var/run/postgresql
+
+auth_type = md5
+auth_file = /etc/pgbouncer/userlist.txt
+admin_users = pgx_md5
+
+pool_mode = transaction
+default_pool_size = 2
+max_client_conn = 100
+max_prepared_statements = 200
+
+server_tls_sslmode = disable
+client_tls_sslmode = disable
+
+logfile = /var/log/postgresql/pgbouncer.log
+pidfile = /var/run/postgresql/pgbouncer.pid