diff --git a/instrumentation/grpc-1.40.0/src/main/java/io/grpc/internal/ServerImpl_Instrumentation.java b/instrumentation/grpc-1.40.0/src/main/java/io/grpc/internal/ServerImpl_Instrumentation.java
index 3108e359f4..aa289953e3 100644
--- a/instrumentation/grpc-1.40.0/src/main/java/io/grpc/internal/ServerImpl_Instrumentation.java
+++ b/instrumentation/grpc-1.40.0/src/main/java/io/grpc/internal/ServerImpl_Instrumentation.java
@@ -42,10 +42,21 @@ private void streamCreatedInternal(
                 StatsTraceContext statsTraceCtx) {
             MethodDescriptor<ReqT, RespT> methodDescriptor = methodDef.getMethodDescriptor();
             String fullMethodName = methodDescriptor != null ? methodDescriptor.getFullMethodName() : null;
-            NewRelic.getAgent().getTransaction().setWebRequest(new GrpcRequest(fullMethodName, stream.getAuthority(), this.headers));
 
+            // Check if this is a BIDI streaming method
+            boolean isBidiStreaming = methodDescriptor != null &&
+                methodDescriptor.getType() == MethodDescriptor.MethodType.BIDI_STREAMING;
+
+            // Always create transaction and set web request
+            NewRelic.getAgent().getTransaction().setWebRequest(new GrpcRequest(fullMethodName, stream.getAuthority(), this.headers));
             stream.token = AgentBridge.getAgent().getTransaction().getToken();
 
+            // Mark BIDI streaming for special handling (transaction ends on first response)
+            if (isBidiStreaming) {
+                stream.isBidiStreaming = true;
+                NewRelic.addCustomParameter("grpc.transaction_ends_on_response", true);
+            }
+
             if (fullMethodName != null && !fullMethodName.isEmpty()) {
                 NewRelic.addCustomParameter("request.method", fullMethodName);
                 NewRelic.getAgent().getTracedMethod().setMetricName("gRPC", "ServerCallHandler", "startCall", fullMethodName);
diff --git a/instrumentation/grpc-1.40.0/src/main/java/io/grpc/internal/ServerStream_Instrumentation.java b/instrumentation/grpc-1.40.0/src/main/java/io/grpc/internal/ServerStream_Instrumentation.java
index f1aef60cb3..136db009eb 100644
--- a/instrumentation/grpc-1.40.0/src/main/java/io/grpc/internal/ServerStream_Instrumentation.java
+++ b/instrumentation/grpc-1.40.0/src/main/java/io/grpc/internal/ServerStream_Instrumentation.java
@@ -28,10 +28,45 @@ public abstract class ServerStream_Instrumentation {
     @NewField
     public Token token;
 
+    @NewField
+    public boolean isBidiStreaming;
+
+    @NewField
+    public boolean responseSent;
+
+    /**
+     * Instrumentation for writeMessage - called when server sends a response message.
+     * For BIDI streaming, we finalize and expire the token after the first message is sent,
+     * which ends the transaction at the point of response completion.
+     */
+    @Trace(async = true)
+    public void writeMessage(Object message) {
+        // Call original method first to send the message
+        Weaver.callOriginal();
+
+        // For BIDI streaming, end transaction after first response is sent
+        if (isBidiStreaming && !responseSent && token != null) {
+            // Finalize the transaction with success status
+            GrpcUtil.finalizeTransaction(token, Status.OK, new Metadata());
+
+            // Expire the token to end the transaction
+            token.expire();
+
+            // Mark that response was sent and clear token
+            responseSent = true;
+            token = null;
+
+            NewRelic.addCustomParameter("grpc.transaction_ended_on_response", true);
+        }
+    }
+
     @Trace(async = true)
     public void close(Status status, Metadata metadata) {
-        GrpcUtil.finalizeTransaction(token, status, metadata);
-        GrpcUtil.setServerStreamResponseStatus(status);
+        // Only finalize if token exists (token will be null for BIDI streaming after response sent)
+        if (token != null) {
+            GrpcUtil.finalizeTransaction(token, status, metadata);
+            GrpcUtil.setServerStreamResponseStatus(status);
+        }
 
         Weaver.callOriginal();
 
@@ -44,8 +79,11 @@ public void close(Status status, Metadata metadata) {
     // server had an internal error
     @Trace(async = true)
     public void cancel(Status status) {
-        GrpcUtil.finalizeTransaction(token, status, new Metadata());
-        GrpcUtil.setServerStreamResponseStatus(status);
+        // Only finalize if token exists (token will be null for BIDI streaming after response sent)
+        if (token != null) {
+            GrpcUtil.finalizeTransaction(token, status, new Metadata());
+            GrpcUtil.setServerStreamResponseStatus(status);
+        }
 
         Weaver.callOriginal();