diff --git a/eth/tracers/api.go b/eth/tracers/api.go
index d99531d48f..30648c4753 100644
--- a/eth/tracers/api.go
+++ b/eth/tracers/api.go
@@ -22,7 +22,6 @@ import (
 	"encoding/json"
 	"errors"
 	"fmt"
-	"math/big"
 	"os"
 	"runtime"
 	"sync"
@@ -982,7 +981,8 @@ func (api *API) traceTx(ctx context.Context, tx *types.Transaction, message *cor
 			return nil, err
 		}
 	}
-	vmenv := vm.NewEVM(vmctx, vm.TxContext{GasPrice: big.NewInt(0)}, statedb, api.backend.ChainConfig(), vm.Config{Tracer: tracer.Hooks, NoBaseFee: true})
+	// The actual TxContext will be created as part of ApplyTransactionWithEVM.
+	vmenv := vm.NewEVM(vmctx, vm.TxContext{GasPrice: message.GasPrice, BlobFeeCap: message.BlobGasFeeCap}, statedb, api.backend.ChainConfig(), vm.Config{Tracer: tracer.Hooks, NoBaseFee: true})
 	statedb.SetLogger(tracer.Hooks)
 
 	// Define a meaningful timeout of a single transaction trace
diff --git a/eth/tracers/api_test.go b/eth/tracers/api_test.go
index 36caee0dda..120cb585c7 100644
--- a/eth/tracers/api_test.go
+++ b/eth/tracers/api_test.go
@@ -32,6 +32,7 @@ import (
 	"github.com/ethereum/go-ethereum/common"
 	"github.com/ethereum/go-ethereum/common/hexutil"
 	"github.com/ethereum/go-ethereum/consensus"
+	"github.com/ethereum/go-ethereum/consensus/beacon"
 	"github.com/ethereum/go-ethereum/consensus/ethash"
 	"github.com/ethereum/go-ethereum/core"
 	"github.com/ethereum/go-ethereum/core/rawdb"
@@ -994,3 +995,90 @@ func TestTraceChain(t *testing.T) {
 		}
 	}
 }
+
+// newTestMergedBackend creates a post-merge chain
+func newTestMergedBackend(t *testing.T, n int, gspec *core.Genesis, generator func(i int, b *core.BlockGen)) *testBackend {
+	backend := &testBackend{
+		chainConfig: gspec.Config,
+		engine:      beacon.NewFaker(),
+		chaindb:     rawdb.NewMemoryDatabase(),
+	}
+	// Generate blocks for testing
+	_, blocks, _ := core.GenerateChainWithGenesis(gspec, backend.engine, n, generator)
+
+	// Import the canonical chain
+	cacheConfig := &core.CacheConfig{
+		TrieCleanLimit:    256,
+		TrieDirtyLimit:    256,
+		TrieTimeLimit:     5 * time.Minute,
+		SnapshotLimit:     0,
+		TrieDirtyDisabled: true, // Archive mode
+	}
+	chain, err := core.NewBlockChain(backend.chaindb, cacheConfig, gspec, nil, backend.engine, vm.Config{}, nil, nil)
+	if err != nil {
+		t.Fatalf("failed to create tester chain: %v", err)
+	}
+	if n, err := chain.InsertChain(blocks); err != nil {
+		t.Fatalf("block %d: failed to insert into chain: %v", n, err)
+	}
+	backend.chain = chain
+	return backend
+}
+
+func TestTraceBlockWithBasefee(t *testing.T) {
+	t.Parallel()
+	accounts := newAccounts(1)
+	target := common.HexToAddress("0x1111111111111111111111111111111111111111")
+	genesis := &core.Genesis{
+		Config: params.AllDevChainProtocolChanges,
+		Alloc: types.GenesisAlloc{
+			accounts[0].addr: {Balance: big.NewInt(1 * params.Ether)},
+			target: {Nonce: 1, Code: []byte{
+				byte(vm.BASEFEE), byte(vm.STOP),
+			}},
+		},
+	}
+	genBlocks := 1
+	signer := types.HomesteadSigner{}
+	var txHash common.Hash
+	var baseFee = new(big.Int)
+	backend := newTestMergedBackend(t, genBlocks, genesis, func(i int, b *core.BlockGen) {
+		tx, _ := types.SignTx(types.NewTx(&types.LegacyTx{
+			Nonce:    uint64(i),
+			To:       &target,
+			Value:    big.NewInt(0),
+			Gas:      5 * params.TxGas,
+			GasPrice: b.BaseFee(),
+			Data:     nil}),
+			signer, accounts[0].key)
+		b.AddTx(tx)
+		txHash = tx.Hash()
+		baseFee.Set(b.BaseFee())
+	})
+	defer backend.chain.Stop()
+	api := NewAPI(backend)
+
+	var testSuite = []struct {
+		blockNumber rpc.BlockNumber
+		config      *TraceConfig
+		want        string
+	}{
+		// Trace head block
+		{
+			blockNumber: rpc.BlockNumber(genBlocks),
+			want:        fmt.Sprintf(`[{"txHash":"%#x","result":{"gas":21002,"failed":false,"returnValue":"","structLogs":[{"pc":0,"op":"BASEFEE","gas":84000,"gasCost":2,"depth":1,"stack":[]},{"pc":1,"op":"STOP","gas":83998,"gasCost":0,"depth":1,"stack":["%#x"]}]}}]`, txHash, baseFee),
+		},
+	}
+	for i, tc := range testSuite {
+		result, err := api.TraceBlockByNumber(context.Background(), tc.blockNumber, tc.config)
+		if err != nil {
+			t.Errorf("test %d, want no error, have %v", i, err)
+			continue
+		}
+		have, _ := json.Marshal(result)
+		want := tc.want
+		if string(have) != want {
+			t.Errorf("test %d, result mismatch\nhave: %v\nwant: %v\n", i, string(have), want)
+		}
+	}
+}