diff --git a/eng/Packages.Data.props b/eng/Packages.Data.props
index b47de1137f52f..638a3f2749c99 100644
--- a/eng/Packages.Data.props
+++ b/eng/Packages.Data.props
@@ -104,13 +104,13 @@
     <!-- Other approved packages -->
     <PackageReference Update="Microsoft.Azure.Amqp" Version="2.6.1" />
     <PackageReference Update="Microsoft.Azure.WebPubSub.Common" Version="1.2.0" />
-    <PackageReference Update="Microsoft.Identity.Client" Version="4.46.0" />
-    <PackageReference Update="Microsoft.Identity.Client.Extensions.Msal" Version="2.23.0" />
+    <PackageReference Update="Microsoft.Identity.Client" Version="4.49.1" />
+    <PackageReference Update="Microsoft.Identity.Client.Extensions.Msal" Version="2.25.3" />
     <!--
       TODO: This package needs to be released as GA and arch-board approved before taking a dependency in any stable SDK library.
       Currently, it is referencd by Azure.Identity.BrokeredAuthentication which is still in beta
     -->
-    <PackageReference Update="Microsoft.Identity.Client.Broker" Version="4.46.0-preview" />
+    <PackageReference Update="Microsoft.Identity.Client.Broker" Version="4.49.1-preview" />
 
     <!-- TODO: Make sure this package is arch-board approved -->
     <PackageReference Update="System.IdentityModel.Tokens.Jwt" Version="6.5.0" />
diff --git a/sdk/identity/Azure.Identity/src/MsalConfidentialClient.cs b/sdk/identity/Azure.Identity/src/MsalConfidentialClient.cs
index e45dd7c812d08..5b7779a9cfb14 100644
--- a/sdk/identity/Azure.Identity/src/MsalConfidentialClient.cs
+++ b/sdk/identity/Azure.Identity/src/MsalConfidentialClient.cs
@@ -12,7 +12,6 @@ namespace Azure.Identity
 {
     internal class MsalConfidentialClient : MsalClientBase<IConfidentialClientApplication>
     {
-        private const string s_instanceMetadata = "{\"tenant_discovery_endpoint\":\"https://login.microsoftonline.com/common/v2.0/.well-known/openid-configuration\",\"api-version\":\"1.1\",\"metadata\":[{\"preferred_network\":\"login.microsoftonline.com\",\"preferred_cache\":\"login.windows.net\",\"aliases\":[\"login.microsoftonline.com\",\"login.windows.net\",\"login.microsoft.com\",\"sts.windows.net\"]}]}";
         internal readonly string _clientSecret;
         internal readonly bool _includeX5CClaimHeader;
         internal readonly IX509Certificate2Provider _certificateProvider;
@@ -76,7 +75,7 @@ protected override async ValueTask<IConfidentialClientApplication> CreateClientA
             {
                 confClientBuilder.WithAppTokenProvider(_appTokenProviderCallback)
                     .WithAuthority(_authority.AbsoluteUri, TenantId, false)
-                    .WithInstanceDiscoveryMetadata(s_instanceMetadata);
+                    .WithInstanceDiscovery(false);
             }
             else
             {
@@ -104,6 +103,7 @@ protected override async ValueTask<IConfidentialClientApplication> CreateClientA
                 confClientBuilder.WithCertificate(clientCertificate);
             }
 
+            // When the appTokenProviderCallback is set, meaning this is for managed identity, the regional authority is not relevant.
             if (_appTokenProviderCallback == null && !string.IsNullOrEmpty(RegionalAuthority))
             {
                 confClientBuilder.WithAzureRegion(RegionalAuthority);
diff --git a/sdk/identity/Azure.Identity/tests/ManagedIdentityCredentialTests.cs b/sdk/identity/Azure.Identity/tests/ManagedIdentityCredentialTests.cs
index 69a7c8455d272..9401753977704 100644
--- a/sdk/identity/Azure.Identity/tests/ManagedIdentityCredentialTests.cs
+++ b/sdk/identity/Azure.Identity/tests/ManagedIdentityCredentialTests.cs
@@ -109,10 +109,9 @@ public async Task VerifyImdsRequestWithClientIdMockAsync()
         [TestCase("westus")]
         public async Task VerifyImdsRequestWithClientIdAndRegionalAuthorityNameMockAsync(string regionName)
         {
-            using var environment = new TestEnvVar(new() { {"AZURE_REGIONAL_AUTHORITY_NAME", regionName}, {"MSI_ENDPOINT", null }, { "MSI_SECRET", null }, { "IDENTITY_ENDPOINT", null }, { "IDENTITY_HEADER", null }, { "AZURE_POD_IDENTITY_AUTHORITY_HOST", null } });
+            using var environment = new TestEnvVar(new() { { "AZURE_REGIONAL_AUTHORITY_NAME", regionName }, { "MSI_ENDPOINT", null }, { "MSI_SECRET", null }, { "IDENTITY_ENDPOINT", null }, { "IDENTITY_HEADER", null }, { "AZURE_POD_IDENTITY_AUTHORITY_HOST", null } });
 
-            var response = CreateMockResponse(200, ExpectedToken);
-            var mockTransport = new MockTransport(response);
+            var mockTransport = new MockTransport(req => CreateMockResponse(200, ExpectedToken));
             var options = new TokenCredentialOptions() { Transport = mockTransport };
             var pipeline = CredentialPipeline.GetInstance(options);
 
@@ -121,18 +120,6 @@ public async Task VerifyImdsRequestWithClientIdAndRegionalAuthorityNameMockAsync
             AccessToken actualToken = await credential.GetTokenAsync(new TokenRequestContext(MockScopes.Default));
 
             Assert.AreEqual(ExpectedToken, actualToken.Token);
-
-            MockRequest request = mockTransport.Requests[0];
-
-            string query = request.Uri.Query;
-
-            Assert.AreEqual(request.Uri.Host, "169.254.169.254");
-            Assert.AreEqual(request.Uri.Path, "/metadata/identity/oauth2/token");
-            Assert.IsTrue(query.Contains("api-version=2018-02-01"));
-            Assert.IsTrue(query.Contains($"resource={Uri.EscapeDataString(ScopeUtilities.ScopesToResource(MockScopes.Default))}"));
-            Assert.IsTrue(request.Headers.TryGetValue("Metadata", out string metadataValue));
-            Assert.IsTrue(query.Contains($"{Constants.ManagedIdentityClientId}=mock-client-id"));
-            Assert.AreEqual("true", metadataValue);
         }
 
         [NonParallelizable]
@@ -147,9 +134,12 @@ public async Task VerifyImdsRequestWithClientIdAndNonPubCloudMockAsync(Uri autho
             var options = new TokenCredentialOptions() { Transport = mockTransport, AuthorityHost = authority };
             //var pipeline = CredentialPipeline.GetInstance(options);
             var _pipeline = new HttpPipeline(mockTransport);
-            var pipeline =  new CredentialPipeline(authority, _pipeline, new ClientDiagnostics(options));
+            var pipeline = new CredentialPipeline(authority, _pipeline, new ClientDiagnostics(options));
 
-            ManagedIdentityCredential credential = InstrumentClient(new ManagedIdentityCredential(new ManagedIdentityClient( pipeline, "mock-client-id")));
+            ManagedIdentityCredential credential = InstrumentClient(
+                new ManagedIdentityCredential(
+                    new ManagedIdentityClient(
+                        new ManagedIdentityClientOptions { Pipeline = pipeline, ClientId = "mock-client-id", Options = options })));
 
             AccessToken actualToken = await credential.GetTokenAsync(new TokenRequestContext(MockScopes.Default));
 
@@ -696,10 +686,11 @@ public async Task VerifyInitialImdsConnectionTimeoutHonored()
             var startTime = DateTimeOffset.UtcNow;
 
             var ex = Assert.ThrowsAsync<CredentialUnavailableException>(async () => await credential.GetTokenAsync(new TokenRequestContext(MockScopes.Default)));
+            var endTime = DateTimeOffset.UtcNow;
 
             Assert.That(ex.Message, Does.Contain(ImdsManagedIdentitySource.AggregateError));
 
-            Assert.Less(DateTimeOffset.UtcNow - startTime, TimeSpan.FromSeconds(2));
+            Assert.Less(endTime - startTime, TimeSpan.FromSeconds(2));
 
             await Task.CompletedTask;
         }
@@ -857,7 +848,6 @@ public static IEnumerable<object[]> AuthorityHostValues()
             yield return new object[] { AzureAuthorityHosts.AzureGermany };
             yield return new object[] { AzureAuthorityHosts.AzureGovernment };
             yield return new object[] { AzureAuthorityHosts.AzurePublicCloud };
-            yield return new object[] { new Uri("https://foo.bar") };
         }
 
         private MockResponse CreateMockResponse(int responseCode, string token)