diff --git a/Sources/AWSLambdaRuntimeCore/Lambda+LocalServer.swift b/Sources/AWSLambdaRuntimeCore/Lambda+LocalServer.swift
index 0d6a285b..f7e1b95a 100644
--- a/Sources/AWSLambdaRuntimeCore/Lambda+LocalServer.swift
+++ b/Sources/AWSLambdaRuntimeCore/Lambda+LocalServer.swift
@@ -276,7 +276,7 @@ private enum LocalLambda {
                 response.headers = [
                     (AmazonHeaders.requestID, self.requestID),
                     (AmazonHeaders.invokedFunctionARN, "arn:aws:lambda:us-east-1:\(Int16.random(in: Int16.min ... Int16.max)):function:custom-runtime"),
-                    (AmazonHeaders.traceID, "Root=\(Int16.random(in: Int16.min ... Int16.max));Parent=\(Int16.random(in: Int16.min ... Int16.max));Sampled=1"),
+                    (AmazonHeaders.traceID, "Root=\(AmazonHeaders.generateXRayTraceID());Sampled=1"),
                     (AmazonHeaders.deadline, "\(DispatchWallTime.distantFuture.millisSinceEpoch)"),
                 ]
                 return response
@@ -295,4 +295,5 @@ private enum LocalLambda {
         case cantBind
     }
 }
+
 #endif
diff --git a/Sources/AWSLambdaRuntimeCore/Utils.swift b/Sources/AWSLambdaRuntimeCore/Utils.swift
index ae5db50f..5e7ffa6e 100644
--- a/Sources/AWSLambdaRuntimeCore/Utils.swift
+++ b/Sources/AWSLambdaRuntimeCore/Utils.swift
@@ -104,3 +104,29 @@ extension String {
         bytes.append(UInt8(ascii: "\""))
     }
 }
+
+extension AmazonHeaders {
+    /// Generates (X-Ray) trace ID.
+    /// # Trace ID Format
+    /// A `trace_id` consists of three numbers separated by hyphens.
+    /// For example, `1-58406520-a006649127e371903a2de979`. This includes:
+    /// - The version number, that is, 1.
+    /// - The time of the original request, in Unix epoch time, in **8 hexadecimal digits**.
+    /// For example, 10:00AM December 1st, 2016 PST in epoch time is `1480615200` seconds, or `58406520` in hexadecimal digits.
+    /// - A 96-bit identifier for the trace, globally unique, in **24 hexadecimal digits**.
+    /// # References
+    /// - [Generating trace IDs](https://docs.aws.amazon.com/xray/latest/devguide/xray-api-sendingdata.html#xray-api-traceids)
+    /// - [Tracing header](https://docs.aws.amazon.com/xray/latest/devguide/xray-concepts.html#xray-concepts-tracingheader)
+    internal static func generateXRayTraceID() -> String {
+        // The version number, that is, 1.
+        let version: UInt = 1
+        // The time of the original request, in Unix epoch time, in 8 hexadecimal digits.
+        let now = UInt32(DispatchWallTime.now().millisSinceEpoch / 1000)
+        let dateValue = String(now, radix: 16, uppercase: false)
+        let datePadding = String(repeating: "0", count: max(0, 8 - dateValue.count))
+        // A 96-bit identifier for the trace, globally unique, in 24 hexadecimal digits.
+        let identifier = String(UInt64.random(in: UInt64.min ... UInt64.max) | 1 << 63, radix: 16, uppercase: false)
+            + String(UInt32.random(in: UInt32.min ... UInt32.max) | 1 << 31, radix: 16, uppercase: false)
+        return "\(version)-\(datePadding)\(dateValue)-\(identifier)"
+    }
+}
diff --git a/Tests/AWSLambdaRuntimeCoreTests/LambdaRuntimeClientTest.swift b/Tests/AWSLambdaRuntimeCoreTests/LambdaRuntimeClientTest.swift
index 728672e6..94c8ac62 100644
--- a/Tests/AWSLambdaRuntimeCoreTests/LambdaRuntimeClientTest.swift
+++ b/Tests/AWSLambdaRuntimeCoreTests/LambdaRuntimeClientTest.swift
@@ -257,7 +257,7 @@ class LambdaRuntimeClientTest: XCTestCase {
             (AmazonHeaders.requestID, "test"),
             (AmazonHeaders.deadline, String(Date(timeIntervalSinceNow: 60).millisSinceEpoch)),
             (AmazonHeaders.invokedFunctionARN, "arn:aws:lambda:us-east-1:123456789012:function:custom-runtime"),
-            (AmazonHeaders.traceID, "Root=1-5bef4de7-ad49b0e87f6ef6c87fc2e700;Parent=9a9197af755a6419;Sampled=1"),
+            (AmazonHeaders.traceID, "Root=\(AmazonHeaders.generateXRayTraceID());Sampled=1"),
         ])
         var inv: Lambda.Invocation?
         XCTAssertNoThrow(inv = try Lambda.Invocation(headers: header))
@@ -297,7 +297,7 @@ class LambdaRuntimeClientTest: XCTestCase {
             (AmazonHeaders.requestID, "test"),
             (AmazonHeaders.deadline, String(Date(timeIntervalSinceNow: 60).millisSinceEpoch)),
             (AmazonHeaders.invokedFunctionARN, "arn:aws:lambda:us-east-1:123456789012:function:custom-runtime"),
-            (AmazonHeaders.traceID, "Root=1-5bef4de7-ad49b0e87f6ef6c87fc2e700;Parent=9a9197af755a6419;Sampled=1"),
+            (AmazonHeaders.traceID, "Root=\(AmazonHeaders.generateXRayTraceID());Sampled=1"),
         ])
         var inv: Lambda.Invocation?
         XCTAssertNoThrow(inv = try Lambda.Invocation(headers: header))
diff --git a/Tests/AWSLambdaRuntimeCoreTests/MockLambdaServer.swift b/Tests/AWSLambdaRuntimeCoreTests/MockLambdaServer.swift
index b2f671a6..9708ccc1 100644
--- a/Tests/AWSLambdaRuntimeCoreTests/MockLambdaServer.swift
+++ b/Tests/AWSLambdaRuntimeCoreTests/MockLambdaServer.swift
@@ -144,7 +144,7 @@ internal final class HTTPHandler: ChannelInboundHandler {
                 responseHeaders = [
                     (AmazonHeaders.requestID, requestId),
                     (AmazonHeaders.invokedFunctionARN, "arn:aws:lambda:us-east-1:123456789012:function:custom-runtime"),
-                    (AmazonHeaders.traceID, "Root=1-5bef4de7-ad49b0e87f6ef6c87fc2e700;Parent=9a9197af755a6419;Sampled=1"),
+                    (AmazonHeaders.traceID, "Root=\(AmazonHeaders.generateXRayTraceID());Sampled=1"),
                     (AmazonHeaders.deadline, String(deadline)),
                 ]
             case .failure(let error):
diff --git a/Tests/AWSLambdaRuntimeCoreTests/UtilsTest.swift b/Tests/AWSLambdaRuntimeCoreTests/UtilsTest.swift
new file mode 100644
index 00000000..c5fc4ab5
--- /dev/null
+++ b/Tests/AWSLambdaRuntimeCoreTests/UtilsTest.swift
@@ -0,0 +1,39 @@
+//===----------------------------------------------------------------------===//
+//
+// This source file is part of the SwiftAWSLambdaRuntime open source project
+//
+// Copyright (c) 2017-2018 Apple Inc. and the SwiftAWSLambdaRuntime project authors
+// Licensed under Apache License v2.0
+//
+// See LICENSE.txt for license information
+// See CONTRIBUTORS.txt for the list of SwiftAWSLambdaRuntime project authors
+//
+// SPDX-License-Identifier: Apache-2.0
+//
+//===----------------------------------------------------------------------===//
+
+@testable import AWSLambdaRuntimeCore
+import XCTest
+
+class UtilsTest: XCTestCase {
+    func testGenerateXRayTraceID() {
+        // the time and identifier should be in hexadecimal digits
+        let invalidCharacters = CharacterSet(charactersIn: "abcdef0123456789").inverted
+        let numTests = 1000
+        var values = Set<String>()
+        for _ in 0 ..< numTests {
+            // check the format, see https://docs.aws.amazon.com/xray/latest/devguide/xray-api-sendingdata.html#xray-api-traceids)
+            let traceId = AmazonHeaders.generateXRayTraceID()
+            let segments = traceId.split(separator: "-")
+            XCTAssertEqual(3, segments.count)
+            XCTAssertEqual("1", segments[0])
+            XCTAssertEqual(8, segments[1].count)
+            XCTAssertNil(segments[1].rangeOfCharacter(from: invalidCharacters))
+            XCTAssertEqual(24, segments[2].count)
+            XCTAssertNil(segments[2].rangeOfCharacter(from: invalidCharacters))
+            values.insert(traceId)
+        }
+        // check that the generated values are different
+        XCTAssertEqual(values.count, numTests)
+    }
+}