diff --git a/ci/nightly/pipeline.template.yml b/ci/nightly/pipeline.template.yml
index fe7605955a5d9..31378ccb03455 100644
--- a/ci/nightly/pipeline.template.yml
+++ b/ci/nightly/pipeline.template.yml
@@ -1696,7 +1696,7 @@ steps:
       - ./ci/plugins/mzcompose:
           composition: 0dt
     agents:
-      queue: hetzner-aarch64-8cpu-16gb
+      queue: hetzner-aarch64-16cpu-32gb
 
   - id: emulator
     label: Materialize Emulator
diff --git a/test/0dt/mzcompose.py b/test/0dt/mzcompose.py
index b66b2258b00d2..3c2d45c372ace 100644
--- a/test/0dt/mzcompose.py
+++ b/test/0dt/mzcompose.py
@@ -13,7 +13,9 @@
 """
 
 import time
+from datetime import datetime, timedelta
 from textwrap import dedent
+from threading import Thread
 
 from psycopg.errors import OperationalError
 
@@ -1388,3 +1390,113 @@ def get_correction_metrics():
         raise AssertionError(
             f"unexpected correction metrics: {insertions=}, {deletions=}"
         )
+
+
+def workflow_upsert_sources(c: Composition) -> None:
+    c.down(destroy_volumes=True)
+    c.up("zookeeper", "kafka", "schema-registry", "postgres", "mysql", "mz_old")
+    c.up("testdrive", persistent=True)
+    num_threads = 500
+
+    c.sql(
+        f"""
+        DROP CLUSTER IF EXISTS cluster CASCADE;
+        CREATE CLUSTER cluster SIZE '2-1';
+        GRANT ALL ON CLUSTER cluster TO materialize;
+        ALTER SYSTEM SET cluster = cluster;
+        ALTER SYSTEM SET max_sources = {num_threads * 2};
+        ALTER SYSTEM SET max_materialized_views = {num_threads * 2};
+    """,
+        service="mz_old",
+        port=6877,
+        user="mz_system",
+    )
+
+    c.testdrive(
+        dedent(
+            """
+        > SET CLUSTER = cluster;
+
+        > CREATE CONNECTION IF NOT EXISTS kafka_conn FOR KAFKA BROKER '${testdrive.kafka-addr}', SECURITY PROTOCOL = 'PLAINTEXT';
+        > CREATE CONNECTION IF NOT EXISTS csr_conn FOR CONFLUENT SCHEMA REGISTRY URL '${testdrive.schema-registry-url}';
+            """
+        )
+    )
+
+    end_time = datetime.now() + timedelta(seconds=600)
+    mz1 = "mz_old"
+    mz2 = "mz_new"
+
+    def worker(i: int) -> None:
+        c.testdrive(
+            dedent(
+                f"""
+            $ kafka-create-topic topic=kafka{i}
+            > CREATE SOURCE kafka_source{i}
+              IN CLUSTER cluster
+              FROM KAFKA CONNECTION kafka_conn (TOPIC 'testdrive-kafka{i}-${{testdrive.seed}}');
+            > CREATE TABLE kafka_source_tbl{i} (key1, key2, value1, value2)
+              FROM SOURCE kafka_source{i} (REFERENCE "testdrive-kafka{i}-${{testdrive.seed}}")
+              KEY FORMAT CSV WITH 2 COLUMNS DELIMITED BY ','
+              VALUE FORMAT CSV WITH 2 COLUMNS DELIMITED BY ','
+              ENVELOPE UPSERT;
+
+            > CREATE DEFAULT INDEX ON kafka_source_tbl{i}
+            > CREATE MATERIALIZED VIEW mv{i} AS SELECT * FROM kafka_source_tbl{i}
+                """
+            )
+        )
+
+        while datetime.now() < end_time:
+            try:
+                c.testdrive(
+                    dedent(
+                        f"""
+                    $ kafka-ingest format=bytes key-format=bytes key-terminator=: topic=kafka{i} repeat=10000
+                    key1A,key1B:value1A,value1B
+                    """
+                    )
+                )
+            except:
+                pass
+
+    threads = []
+    for i in range(num_threads):
+        thread = Thread(name=f"worker_{i}", target=worker, args=(i,))
+        threads.append(thread)
+
+    for thread in threads:
+        thread.start()
+
+    i = 1
+    while datetime.now() < end_time:
+        with c.override(
+            Materialized(
+                name=mz2,
+                sanity_restart=False,
+                deploy_generation=i,
+                system_parameter_defaults=SYSTEM_PARAMETER_DEFAULTS,
+                restart="on-failure",
+                external_metadata_store=True,
+            ),
+            Testdrive(
+                materialize_url=f"postgres://materialize@{mz1}:6875",
+                materialize_url_internal=f"postgres://materialize@{mz1}:6877",
+                mz_service=mz1,
+                materialize_params={"cluster": "cluster"},
+                no_consistency_checks=True,
+                no_reset=True,
+                seed=1,
+                default_timeout=DEFAULT_TIMEOUT,
+            ),
+        ):
+            c.up(mz2)
+            c.await_mz_deployment_status(DeploymentStatus.READY_TO_PROMOTE, mz2)
+            c.promote_mz(mz2)
+            c.await_mz_deployment_status(DeploymentStatus.IS_LEADER, mz2)
+
+        i += 1
+        mz1, mz2 = mz2, mz1
+
+    for thread in threads:
+        thread.join()