diff --git a/.github/actions/configure-hosts/action.yaml b/.github/actions/configure-hosts/action.yaml
new file mode 100644
index 0000000000..c7f478a94c
--- /dev/null
+++ b/.github/actions/configure-hosts/action.yaml
@@ -0,0 +1,16 @@
+name: Configure hosts
+description: Introduces an entry to the /etc/hosts file resolving k3d-kcp-registry to localhost.
+runs:
+  using: composite
+  steps:
+    - name: Configure hosts
+      shell: bash
+      run: |
+        FILE=/etc/hosts
+        if [ -f "$FILE" ]; then
+            sudo echo "127.0.0.1 k3d-kcp-registry" | sudo tee -a $FILE
+        else
+            echo "$FILE does not exist."
+            exit 1
+        fi
+        echo "/etc/hosts file patched"
diff --git a/.github/actions/create-k3d-cluster/action.yaml b/.github/actions/create-k3d-cluster/action.yaml
new file mode 100644
index 0000000000..58e814e8c8
--- /dev/null
+++ b/.github/actions/create-k3d-cluster/action.yaml
@@ -0,0 +1,32 @@
+name: Create k3d cluster
+description: Creates a k3d cluster.
+inputs:
+  cluster_name:
+    description: The name of the cluster to create.
+    required: true
+  k8s_version:
+    description: The version of k8s to use.
+    required: true
+  args:
+    description: Additional arguments to pass to the k3d cluster create command separated by semicolon (;).
+    required: false
+runs:
+  using: composite
+  steps:
+    - name: Create k3d cluster
+      shell: bash
+      run: |
+        IFS=';' read -ra splitted_args <<< "${{ inputs.args }}"
+  
+        create_command="k3d cluster create ${{ inputs.cluster_name }} "
+          
+        for arg in "${splitted_args[@]}";
+        do
+          create_command+="$arg "
+        done
+          
+        create_command+="--image rancher/k3s:v${{ inputs.k8s_version }}-k3s1 "
+        create_command+="--k3s-arg --disable=traefik@server:* "
+        create_command+="--k3s-arg --tls-san=host.k3d.internal@server:* "
+
+        eval ${create_command}
diff --git a/.github/actions/deploy-cert-manager/action.yaml b/.github/actions/deploy-cert-manager/action.yaml
new file mode 100644
index 0000000000..aa1cb7be1d
--- /dev/null
+++ b/.github/actions/deploy-cert-manager/action.yaml
@@ -0,0 +1,14 @@
+name: Deploy cert-manager
+description: Deploys cert-manager in the currently configured context.
+inputs:
+  cert_manager_version:
+    description: The version of cert-manager to deploy. For example, 1.13.3.
+    required: true
+runs:
+  using: composite
+  steps:
+    - name: Deploy cert-manager
+      shell: bash
+      run: |
+        kubectl apply -f https://github.com/cert-manager/cert-manager/releases/download/v${{ inputs.cert_manager_version }}/cert-manager.yaml
+        cmctl check api --wait=2m
diff --git a/.github/actions/deploy-istio/action.yaml b/.github/actions/deploy-istio/action.yaml
new file mode 100644
index 0000000000..c1359f8c89
--- /dev/null
+++ b/.github/actions/deploy-istio/action.yaml
@@ -0,0 +1,9 @@
+name: Deploy istio
+description: Deploys istio in the currently configured context.
+runs:
+  using: composite
+  steps:
+    - name: Deploy istio
+      shell: bash
+      run: |
+        istioctl install --set profile=demo -y
diff --git a/.github/actions/deploy-lifecycle-manager-e2e/action.yaml b/.github/actions/deploy-lifecycle-manager-e2e/action.yaml
new file mode 100644
index 0000000000..8e65400435
--- /dev/null
+++ b/.github/actions/deploy-lifecycle-manager-e2e/action.yaml
@@ -0,0 +1,91 @@
+name: Deploy lifecycle-manager E2E
+description: Applies E2E test-specific patches to the lifecycle-manager kustomize and deploys it.
+inputs:
+  klm_version_tag:
+    description: The version tag for the KLM image. For example, PR-123.
+    required: true
+  klm_image_repo:
+    description: The repository for the KLM image. For example, dev.
+    required: true
+runs:
+  using: composite
+  steps:
+    - name: Patch purge finalizer flags
+      if: ${{ matrix.e2e-test == 'purge-controller' ||  matrix.e2e-test == 'purge-metrics'}}
+      working-directory: lifecycle-manager
+      shell: bash
+      run: |
+        pushd config/watcher_local_test
+        echo \
+        "- op: add
+          path: /spec/template/spec/containers/0/args/-
+          value: --enable-purge-finalizer=true
+        - op: add
+          path: /spec/template/spec/containers/0/args/-
+          value: --purge-finalizer-timeout=5s" >> purge_finalizer.yaml
+        cat purge_finalizer.yaml
+        kustomize edit add patch --path purge_finalizer.yaml --kind Deployment
+        popd
+    - name: Patch metrics cleanup interval
+      if : ${{ matrix.e2e-test == 'kyma-metrics' }}
+      working-directory: lifecycle-manager
+      shell: bash
+      run: |
+        pushd config/watcher_local_test
+        echo \
+        "- op: add
+          path: /spec/template/spec/containers/0/args/-
+          value: --metrics-cleanup-interval=1" >> metrics_cleanup.yaml
+        cat metrics_cleanup.yaml
+        kustomize edit add patch --path metrics_cleanup.yaml --kind Deployment
+        popd
+    - name: Patch self signed certificate lifetime
+      if: ${{matrix.e2e-test == 'self-signed-certificate-rotation'}}
+      working-directory: lifecycle-manager
+      shell: bash
+      run: |
+        pushd config/watcher_local_test
+        echo \
+        "- op: add
+          path: /spec/template/spec/containers/0/args/-
+          value: --self-signed-cert-duration=1h
+        - op: add
+          path: /spec/template/spec/containers/0/args/-
+          value: --self-signed-cert-renew-before=59m
+        - op: add
+          path: /spec/template/spec/containers/0/args/-
+          value: --self-signed-cert-renew-buffer=1m" >> self-signed-cert.yaml
+        cat self-signed-cert.yaml
+        kustomize edit add patch --path self-signed-cert.yaml --kind Deployment
+        popd
+    - name: Patch CA certificate renewBefore
+      if: ${{matrix.e2e-test == 'ca-certificate-rotation'}}
+      working-directory: lifecycle-manager
+      shell: bash
+      run: |
+        pushd config/watcher_local_test
+        echo \
+        "- op: replace
+          path: /spec/renewBefore
+          value: 59m 
+        - op: replace
+          path: /spec/duration
+          value: 1h">> certificate_renewal.yaml
+        cat certificate_renewal.yaml
+        kustomize edit add patch --path certificate_renewal.yaml --kind Certificate --group cert-manager.io --version v1 --name watcher-serving-cert
+        popd
+    - name: Deploy LM local testing kustomize
+      uses: ./lifecycle-manager/.github/actions/deploy-lifecycle-manager
+      with:
+        klm_version_tag: ${{ inputs.klm_version_tag }}
+        klm_image_repo: ${{ inputs.klm_image_repo }}
+    - name: Expose Metrics Endpoint
+      working-directory: lifecycle-manager
+      if: ${{ matrix.e2e-test == 'kyma-metrics' ||
+        matrix.e2e-test == 'purge-metrics' ||
+        matrix.e2e-test == 'self-signed-certificate-rotation' ||
+        matrix.e2e-test == 'mandatory-module-metrics'
+        }}
+      shell: bash
+      run: |
+        kubectl patch svc klm-metrics-service -p '{"spec": {"type": "LoadBalancer"}}' -n kcp-system
diff --git a/.github/actions/deploy-lifecycle-manager/action.yaml b/.github/actions/deploy-lifecycle-manager/action.yaml
new file mode 100644
index 0000000000..2587d68d5b
--- /dev/null
+++ b/.github/actions/deploy-lifecycle-manager/action.yaml
@@ -0,0 +1,31 @@
+name: Deploy lifecycle-manager
+description: Deploys lifecycle-manager.
+inputs:
+  klm_version_tag:
+    description: The version tag for the KLM image. For example, PR-123.
+    required: true
+  klm_image_repo:
+    description: The repository for the KLM image. For example, dev.
+    required: true
+runs:
+  using: composite
+  steps:
+    - name: Deploy LM local testing kustomize
+      working-directory: lifecycle-manager
+      shell: bash
+      run: |
+        maxRetry=5
+        for retry in $(seq 1 $maxRetry)
+        do
+          if make local-deploy-with-watcher IMG=europe-docker.pkg.dev/kyma-project/${{ inputs.klm_image_repo }}/lifecycle-manager:${{ inputs.klm_version_tag }}; then
+            kubectl wait pods -n kcp-system -l app.kubernetes.io/name=lifecycle-manager --for condition=Ready --timeout=90s
+            echo "KLM deployed successfully"
+            exit 0
+          elif [[ $retry -lt $maxRetry ]]; then
+            echo "Deploy encountered some error, will retry after 20 seconds"
+            sleep 20
+          else
+            echo "KLM deployment failed"
+            exit 1
+          fi
+        done
diff --git a/.github/actions/deploy-template-operator/action.yaml b/.github/actions/deploy-template-operator/action.yaml
new file mode 100644
index 0000000000..a411232416
--- /dev/null
+++ b/.github/actions/deploy-template-operator/action.yaml
@@ -0,0 +1,90 @@
+name: Deploy template-operator
+description: Deploys a test-specific template-operator.
+runs:
+  using: composite
+  steps:
+    - name: Create Template Operator Module and apply
+      working-directory: template-operator
+      if: ${{ matrix.e2e-test == 'kyma-metrics' ||
+        matrix.e2e-test == 'non-blocking-deletion' ||
+        matrix.e2e-test == 'purge-controller' ||
+        matrix.e2e-test == 'purge-metrics' ||
+        matrix.e2e-test == 'kyma-deprovision-with-foreground-propagation' ||
+        matrix.e2e-test == 'kyma-deprovision-with-background-propagation' ||
+        matrix.e2e-test == 'module-consistency' ||
+        matrix.e2e-test == 'skip-manifest-reconciliation' ||
+        matrix.e2e-test == 'misconfigured-kyma-secret'
+        }}
+      shell: bash
+      run: |
+        make build-manifests
+        kyma alpha create module --module-config-file ./module-config.yaml --path . --registry k3d-kcp-registry:5111 --insecure
+        sed -i 's/k3d-kcp-registry:5111/k3d-kcp-registry:5000/g' ./template.yaml
+        kubectl get crds
+        kubectl apply -f template.yaml
+    - name: Create Template Operator Module for regular and fast channels
+      working-directory: lifecycle-manager
+      if: ${{ matrix.e2e-test == 'module-upgrade-channel-switch' || 
+        matrix.e2e-test == 'module-upgrade-new-version' || 
+        matrix.e2e-test == 'upgrade-under-deletion' 
+        }}
+      shell: bash
+      run: |
+        kubectl apply -f tests/moduletemplates/moduletemplate_template_operator_v2_fast.yaml
+        kubectl apply -f tests/moduletemplates/moduletemplate_template_operator_v1_regular.yaml
+    - name: Create Template Operator Module as Mandatory Module
+      working-directory: lifecycle-manager
+      if: ${{ matrix.e2e-test == 'mandatory-module' ||
+        matrix.e2e-test == 'mandatory-module-metrics' 
+        }}
+      shell: bash
+      run: |
+        kubectl apply -f tests/moduletemplates/mandatory_moduletemplate_template_operator_v1.yaml
+    - name: Apply Template Operator Module V2, fast channel
+      working-directory: ./lifecycle-manager
+      if: ${{ matrix.e2e-test == 'non-blocking-deletion' }}
+      shell: bash
+      run: |
+        kubectl apply -f tests/moduletemplates/moduletemplate_template_operator_v2_fast.yaml
+    - name: Create Template Operator Module with final state and final deletion state as `Warning` and apply
+      working-directory: template-operator
+      if: ${{ matrix.e2e-test == 'module-status-propagation'}}
+      shell: bash
+      run: |
+        pushd config/default
+        echo \
+        "- op: replace
+          path: /spec/template/spec/containers/0/args/1
+          value: --final-state=Warning
+        - op: replace
+          path: /spec/template/spec/containers/0/args/2
+          value: --final-deletion-state=Warning" >> warning_patch.yaml
+        cat warning_patch.yaml
+        kustomize edit add patch --path warning_patch.yaml --kind Deployment
+        popd
+        kyma alpha create module --kubebuilder-project  --channel=regular --name kyma.project.io/module/template-operator --version 1.1.1 --path . --registry k3d-kcp-registry:5111 --insecure --module-archive-version-overwrite /
+        sed -i 's/k3d-kcp-registry:5111/k3d-kcp-registry:5000/g' ./template.yaml
+        kubectl get crds
+        kubectl apply -f template.yaml
+    - name: Create Template Operator Module without default CR and apply
+      working-directory: template-operator
+      if: ${{ matrix.e2e-test == 'module-without-default-cr' }}
+      shell: bash
+      run: |
+        make build-manifests
+        echo "name: kyma-project.io/module/template-operator
+        channel: regular
+        version: v1.0.0
+        manifest: template-operator.yaml
+        security: sec-scanners-config.yaml
+        annotations:
+          operator.kyma-project.io/doc-url: https://kyma-project.io" >> module-config-no-cr.yaml
+        kyma alpha create module \
+        --module-config-file ./module-config-no-cr.yaml \
+        --path . \
+        --registry k3d-kcp-registry:5111 \
+        --insecure
+        sed -i 's/k3d-kcp-registry:5111/k3d-kcp-registry:5000/g' ./template.yaml
+        kubectl get crds
+        kubectl apply -f template.yaml
+
diff --git a/.github/actions/export-kubeconfigs/action.yaml b/.github/actions/export-kubeconfigs/action.yaml
new file mode 100644
index 0000000000..d5a598cfc5
--- /dev/null
+++ b/.github/actions/export-kubeconfigs/action.yaml
@@ -0,0 +1,15 @@
+name: Export kubeconfigs
+description: Merges the configs from KCP and SKR k3d clusters into the default kubeconfig and exports the same as environment variables KCP_KUBECONFIG and SKR_KUBECONFIG.
+inputs:
+  context_name:
+    description: The name of the context to use.
+    required: true
+runs:
+  using: composite
+  steps:
+    - name: Export kubeconfigs
+      shell: bash
+      run: |
+        k3d kubeconfig merge -a -d
+        echo "KCP_KUBECONFIG=$(k3d kubeconfig write kcp)" >> $GITHUB_ENV
+        echo "SKR_KUBECONFIG=$(k3d kubeconfig write skr)" >> $GITHUB_ENV
diff --git a/.github/actions/get-configuration/action.yaml b/.github/actions/get-configuration/action.yaml
new file mode 100644
index 0000000000..f91d5db4ed
--- /dev/null
+++ b/.github/actions/get-configuration/action.yaml
@@ -0,0 +1,38 @@
+name: Get configuration
+description: Defines configuration variables such as versions. Exposes globally needed environment variables.
+outputs:
+  k8s_version:
+    description: The version of k8s to use. For example, 1.28.7.
+    value: ${{ steps.define-variables.outputs.k8s_version }}
+  istio_version:
+    description: The version of Istio to install. For example, 1.20.3.
+    value: ${{ steps.define-variables.outputs.istio_version }}
+  k3d_version:
+    description: The version of k3d to install. For example, 5.6.0.
+    value: ${{ steps.define-variables.outputs.k3d_version }}
+  cert_manager_version:
+    description: The version of cert-manager to deploy. For example, 1.13.3.
+    value: ${{ steps.define-variables.outputs.cert_manager_version }}
+  klm_version_tag:
+    description: The version tag for the KLM image. For example, PR-123.
+    value: ${{ steps.define-variables.outputs.klm_version_tag }}
+  klm_image_repo:
+    description: The repository for the KLM image. For example, dev.
+    value: ${{ steps.define-variables.outputs.klm_image_repo }}
+runs:
+  using: composite
+  steps:
+    - name: Define variables
+      id: define-variables
+      shell: bash
+      run: |
+        echo "k8s_version=${{ github.event.inputs.k8s_version || '1.28.7' }}" >> $GITHUB_OUTPUT
+        echo "istio_version=1.20.3" >> $GITHUB_OUTPUT
+        echo "k3d_version=5.6.0" >> $GITHUB_OUTPUT
+        echo "cert_manager_version=1.13.3" >> $GITHUB_OUTPUT
+        echo "klm_version_tag=PR-${{ github.event.pull_request.number }}" >> $GITHUB_OUTPUT
+        echo "klm_image_repo=dev" >> $GITHUB_OUTPUT
+    - name: Expose environment variables
+      shell: bash
+      run: |
+        echo "GOSUMDB=off" >> $GITHUB_ENV
diff --git a/.github/actions/install-cmctl/action.yaml b/.github/actions/install-cmctl/action.yaml
new file mode 100644
index 0000000000..1c83e91bb8
--- /dev/null
+++ b/.github/actions/install-cmctl/action.yaml
@@ -0,0 +1,14 @@
+name: Install cmctl
+description: Downloads cmctl (cert-manager Command Line Tool) and installs it locally.
+runs:
+  using: composite
+  steps:
+    - name: Install cmctl
+      shell: bash
+      run: |
+        OS=$(go env GOOS)
+        ARCH=$(go env GOARCH)
+        
+        curl -fsSL -o cmctl.tar.gz https://github.com/cert-manager/cert-manager/releases/latest/download/cmctl-$OS-$ARCH.tar.gz
+        tar xzf cmctl.tar.gz
+        sudo mv cmctl /usr/local/bin
diff --git a/.github/actions/install-istioctl/action.yaml b/.github/actions/install-istioctl/action.yaml
new file mode 100644
index 0000000000..24dbd52971
--- /dev/null
+++ b/.github/actions/install-istioctl/action.yaml
@@ -0,0 +1,15 @@
+name: Install istioctl
+description: Downloads istioctl and installs it locally.
+inputs:
+  istio_version:
+    description: The version of istioctl to install. For example, 1.20.3.
+    required: true
+runs:
+  using: composite
+  steps:
+    - name: Install istioctl
+      shell: bash
+      run: |
+        curl -L https://istio.io/downloadIstio | ISTIO_VERSION=${{ inputs.istio_version }} TARGET_ARCH=x86_64 sh -
+        chmod +x istio-${{ inputs.istio_version }}/bin/istioctl
+        mv istio-${{ inputs.istio_version }}/bin/istioctl /usr/local/bin
diff --git a/.github/actions/install-k3d/action.yaml b/.github/actions/install-k3d/action.yaml
new file mode 100644
index 0000000000..b7aacf6df2
--- /dev/null
+++ b/.github/actions/install-k3d/action.yaml
@@ -0,0 +1,13 @@
+name: Install k3d
+description: Downloads k3d and installs it locally.
+inputs:
+  k3d_version:
+    description: The version of k3d to install. For example, 5.6.0.
+    required: true
+runs:
+  using: composite
+  steps:
+    - name: Install k3d
+      shell: bash
+      run: |
+        wget -qO - https://raw.githubusercontent.com/k3d-io/k3d/main/install.sh | TAG=v${{ inputs.k3d_version }} bash
diff --git a/.github/actions/install-kubectl/action.yaml b/.github/actions/install-kubectl/action.yaml
new file mode 100644
index 0000000000..b74b463cfb
--- /dev/null
+++ b/.github/actions/install-kubectl/action.yaml
@@ -0,0 +1,32 @@
+name: Install kubectl
+description: Downloads kubectl and installs it locally. Follows the instructions for Debian-based distributions at https://kubernetes.io/docs/tasks/tools/install-kubectl-linux/#install-using-native-package-management.
+inputs:
+  k8s_version:
+    description: The version of Kubernetes to install. For example, 1.28.7.
+    required: true
+runs:
+  using: composite
+  steps:
+    - name: Parse K8s minor version
+      id: parse_k8s_minor_version
+      shell: bash
+      run: |
+        full_version=${{ inputs.k8s_version }}
+        split=( ${full_version//./ } )
+        k8s_minor_version=${split[0]}.${split[1]}
+
+        echo Using K8s minor version ${k8s_minor_version}
+        echo "k8s_minor_version=${k8s_minor_version}" >> $GITHUB_OUTPUT
+    - name: Download the public signing key for the Kubernetes package repositories
+      shell: bash
+      run: |
+        curl -fsSL https://pkgs.k8s.io/core:/stable:/v${{ steps.parse_k8s_minor_version.outputs.k8s_minor_version }}/deb/Release.key | sudo gpg --batch --yes --dearmor -o /etc/apt/keyrings/kubernetes-apt-keyring.gpg
+    - name: Add the appropriate Kubernetes apt repository
+      shell: bash
+      run: |
+        echo 'deb [signed-by=/etc/apt/keyrings/kubernetes-apt-keyring.gpg] https://pkgs.k8s.io/core:/stable:/v${{ steps.parse_k8s_minor_version.outputs.k8s_minor_version }}/deb/ /' | sudo tee /etc/apt/sources.list.d/kubernetes.list
+    - name: Install kubectl
+      shell: bash
+      run: |
+        sudo apt-get update
+        sudo apt-get install -y kubectl
diff --git a/.github/actions/install-kyma-cli/action.yaml b/.github/actions/install-kyma-cli/action.yaml
new file mode 100644
index 0000000000..1e2e347155
--- /dev/null
+++ b/.github/actions/install-kyma-cli/action.yaml
@@ -0,0 +1,12 @@
+name: Install kyma-cli
+description: Downloads kyma-cli and installs it locally.
+runs:
+  using: composite
+  steps:
+    - name: Install kyma-cli
+      shell: bash
+      run: |
+        wget https://storage.googleapis.com/kyma-cli-unstable/kyma-linux
+        chmod +x kyma-linux && mv kyma-linux /usr/local/bin/kyma-unstable
+        echo "PATH=/usr/local/bin/kyma-unstable" >> $GITHUB_OUTPUT
+        ln -s /usr/local/bin/kyma-unstable /usr/local/bin/kyma
diff --git a/.github/actions/setup-test-clusters/action.yaml b/.github/actions/setup-test-clusters/action.yaml
new file mode 100644
index 0000000000..47c8106bd9
--- /dev/null
+++ b/.github/actions/setup-test-clusters/action.yaml
@@ -0,0 +1,31 @@
+name: Setup test clusters
+description: Creates and configures the KCP and SKR clusters.
+inputs:
+  k8s_version:
+    description: The version of k8s to use. For example, 1.28.7
+    required: true
+  cert_manager_version:
+    description: The version of cert-manager to depoy. For example, 1.13.3.
+    required: true
+runs:
+  using: composite
+  steps:
+    - uses: ./lifecycle-manager/.github/actions/configure-hosts
+    - uses: ./lifecycle-manager/.github/actions/create-k3d-cluster
+      with:
+        cluster_name: skr
+        k8s_version: ${{ inputs.k8s_version }}
+        args: "-p 10080:80@loadbalancer;-p 10443:443@loadbalancer"
+    - uses: ./lifecycle-manager/.github/actions/create-k3d-cluster
+      with:
+        cluster_name: kcp
+        k8s_version: ${{ inputs.k8s_version }}
+        args: "-p 9443:443@loadbalancer;-p 9080:80@loadbalancer;-p 9081:8080@loadbalancer;--registry-create k3d-kcp-registry:5111"
+    - uses: ./lifecycle-manager/.github/actions/export-kubeconfigs
+    - uses: ./lifecycle-manager/.github/actions/switch-kubectl-context
+      with:
+        context_name: k3d-kcp
+    - uses: ./lifecycle-manager/.github/actions/deploy-istio
+    - uses: ./lifecycle-manager/.github/actions/deploy-cert-manager
+      with:
+        cert_manager_version: ${{ inputs.cert_manager_version }}
diff --git a/.github/actions/setup-tools/action.yaml b/.github/actions/setup-tools/action.yaml
new file mode 100644
index 0000000000..f9ed2a9a2c
--- /dev/null
+++ b/.github/actions/setup-tools/action.yaml
@@ -0,0 +1,36 @@
+name: Setup tools
+description: Downloads, installs and configures all the tools needed to setup and run the tests.
+inputs:
+  k8s_version:
+    description: The version of Kubernetes to install. For example, 1.28.7.
+    required: true
+  istio_version:
+    description: The version of Istio to install. For example, 1.20.3.
+    required: true
+  k3d_version:
+    description: The version of k3d to install. For example, 5.6.0.
+    required: true
+  go-version-file: 
+    description: The path to the Go version file.
+    required: true
+  cache-dependency-path:
+    description: The path to the Go dependency file.
+    required: true
+runs:
+  using: composite
+  steps:
+    - uses: ./lifecycle-manager/.github/actions/install-kubectl
+      with:
+        k8s_version: ${{ inputs.k8s_version }}
+    - uses: ./lifecycle-manager/.github/actions/install-istioctl
+      with:
+        istio_version: ${{ inputs.istio_version }}
+    - uses: ./lifecycle-manager/.github/actions/install-kyma-cli
+    - uses: ./lifecycle-manager/.github/actions/install-cmctl
+    - uses: ./lifecycle-manager/.github/actions/install-k3d
+      with:
+        k3d_version: ${{ inputs.k3d_version }}
+    - uses: actions/setup-go@v4
+      with:
+        go-version-file: ${{ inputs.go-version-file }}
+        cache-dependency-path: ${{ inputs.cache-dependency-path }}
diff --git a/.github/actions/switch-kubectl-context/action.yaml b/.github/actions/switch-kubectl-context/action.yaml
new file mode 100644
index 0000000000..c173dd74e8
--- /dev/null
+++ b/.github/actions/switch-kubectl-context/action.yaml
@@ -0,0 +1,13 @@
+name: Switch kubectl context
+description: Switches kubectl to use the context with the provided name.
+inputs:
+  context_name:
+    description: The name of the context to use.
+    required: true
+runs:
+  using: composite
+  steps:
+    - name: Configure kubectl
+      shell: bash
+      run: |
+        kubectl config use-context ${{ inputs.context_name }}
diff --git a/.github/actions/wait-for-image-build/action.yaml b/.github/actions/wait-for-image-build/action.yaml
new file mode 100644
index 0000000000..74005f6803
--- /dev/null
+++ b/.github/actions/wait-for-image-build/action.yaml
@@ -0,0 +1,34 @@
+name: Wait for image build
+description: Waits for the image to be built. Exits with error if not built within the given timeout.
+inputs:
+  token:
+    description: The GitHub token to use for making API requests.
+    required: true
+  statusName: 
+    description: The name of the GitHub status check to wait for. For example, `build` or `deploy`.
+    required: true
+  timeoutSeconds:
+    description: The number of seconds to wait for the status check to complete.
+    required: false
+    default: "900"
+  intervalSeconds:
+    description: The number of seconds to wait before each poll of the GitHub API.
+    required: false
+    default: "10"
+runs:
+  using: composite
+  steps:
+    - name: Wait for image build
+      id: wait-for-build
+      with:
+        token: ${{ inputs.token }}
+        statusName: ${{ inputs.statusName }}
+        timeoutSeconds: ${{ inputs.timeoutSeconds }}
+        intervalSeconds: ${{ inputs.intervalSeconds }}
+      uses: autotelic/action-wait-for-status-check@v1
+    - name: Exit if build failed
+      if: steps.wait-for-build.outputs.state != 'success'
+      shell: bash
+      run: |
+        echo "Image build did not succeed!"
+        exit 1
diff --git a/.github/workflows/test-e2e.yaml b/.github/workflows/test-e2e.yaml
new file mode 100644
index 0000000000..85d38c5a02
--- /dev/null
+++ b/.github/workflows/test-e2e.yaml
@@ -0,0 +1,94 @@
+name: TestSuite E2E
+
+on:
+  pull_request:
+    branches:
+      - main
+  workflow_dispatch:
+    inputs:
+      k8s_version:
+        description: With Kubernetes version
+        required: false
+
+jobs:
+  wait-for-image-build:
+    name: Wait for image build
+    runs-on: ubuntu-latest
+    steps:
+      - uses: actions/checkout@v4
+      - uses: ./.github/actions/wait-for-image-build
+        with:
+          token: ${{ secrets.GITHUB_TOKEN }}
+          statusName: pull-lifecycle-mgr-build
+  e2e-integration:
+    name: E2E
+    needs: wait-for-image-build
+    strategy:
+      matrix:
+        e2e-test:
+          - watcher-enqueue
+          - kyma-deprovision-with-foreground-propagation
+          - kyma-deprovision-with-background-propagation
+          - module-status-propagation
+          - kyma-metrics
+          - module-without-default-cr
+          - module-consistency
+          - non-blocking-deletion
+          - upgrade-under-deletion
+          - purge-controller
+          - purge-metrics
+          - module-upgrade-channel-switch
+          - module-upgrade-new-version
+          - skip-manifest-reconciliation
+          - ca-certificate-rotation
+          - self-signed-certificate-rotation
+          - mandatory-module
+          - mandatory-module-metrics
+          - misconfigured-kyma-secret
+          - rbac-privileges
+    runs-on: ubuntu-latest
+    timeout-minutes: 20
+    steps:
+      - name: Checkout lifecycle-manager
+        uses: actions/checkout@v4
+        with:
+          path: lifecycle-manager
+
+      - name: Checkout template-operator
+        uses: actions/checkout@v4
+        with:
+          repository: kyma-project/template-operator
+          path: template-operator
+
+      - name: Get configuration
+        uses: ./lifecycle-manager/.github/actions/get-configuration
+        id: configuration
+
+      - name: Setup tools
+        uses: ./lifecycle-manager/.github/actions/setup-tools
+        with:
+          k8s_version: ${{ steps.configuration.outputs.k8s_version }}
+          istio_version: ${{ steps.configuration.outputs.istio_version }}
+          k3d_version: ${{ steps.configuration.outputs.k3d_version }}
+          go-version-file: lifecycle-manager/go.mod
+          cache-dependency-path: lifecycle-manager/go.sum
+
+      - name: Setup test clusters
+        uses: ./lifecycle-manager/.github/actions/setup-test-clusters
+        with:
+          k8s_version: ${{ steps.configuration.outputs.k8s_version }}
+          cert_manager_version: ${{ steps.configuration.outputs.cert_manager_version }}
+
+      - name: Deploy lifecycle-manager
+        uses: ./lifecycle-manager/.github/actions/deploy-lifecycle-manager-e2e
+        with:
+          klm_version_tag: ${{ steps.configuration.outputs.klm_version_tag }}
+          klm_image_repo: ${{ steps.configuration.outputs.klm_image_repo }}
+
+      - name: Deploy template-operator
+        uses: ./lifecycle-manager/.github/actions/deploy-template-operator
+
+      - name: Run '${{ matrix.e2e-test }}' test
+        working-directory: lifecycle-manager
+        run: |
+          make -C tests/e2e ${{ matrix.e2e-test }}
diff --git a/.github/workflows/test-e2e.yml b/.github/workflows/test-e2e.yml
deleted file mode 100644
index a8e8b0c10a..0000000000
--- a/.github/workflows/test-e2e.yml
+++ /dev/null
@@ -1,324 +0,0 @@
-name: TestSuite E2E
-
-on:
-  pull_request:
-    branches: [ "main" ]
-  workflow_dispatch:
-    inputs:
-      k8s_version:
-        description: "With Kubernetes version"
-        required: false
-jobs:
-  wait-for-img:
-    name: "Wait for Image Build"
-    runs-on: ubuntu-latest
-    steps:
-      - uses: autotelic/action-wait-for-status-check@v1
-        id: wait-for-build
-        with:
-          token: ${{ secrets.GITHUB_TOKEN }}
-          # Context for which we should look for the matching status
-          statusName: ${{ (github.event_name == 'pull_request') && 'pull-lifecycle-mgr-build' || 'main-lifecycle-mgr-build' }}
-          timeoutSeconds: 900
-          intervalSeconds: 10
-      - name: Exit If Failing Build Requirement
-        if: steps.wait-for-build.outputs.state != 'success'
-        run: |
-          echo "Image build did not succeed, skipping E2E Test!"
-          exit 1
-
-  e2e-integration:
-    strategy:
-      matrix:
-        e2e-test: [ "watcher-enqueue",
-                    "kyma-deprovision-with-foreground-propagation",
-                    "kyma-deprovision-with-background-propagation",
-                    "module-status-propagation",
-                    "kyma-metrics",
-                    "module-without-default-cr",
-                    "module-consistency",
-                    "non-blocking-deletion",
-                    "upgrade-under-deletion",
-                    "purge-controller",
-                    "purge-metrics",
-                    "module-upgrade-channel-switch",
-                    "module-upgrade-new-version",
-                    "skip-manifest-reconciliation",
-                    "ca-certificate-rotation",
-                    "self-signed-certificate-rotation",
-                    "mandatory-module",
-                    "mandatory-module-metrics",
-                    "misconfigured-kyma-secret",
-                    "rbac-privileges"
-        ]
-    name: "E2E"
-    needs: [wait-for-img]
-    runs-on: ubuntu-latest
-    timeout-minutes: 20
-    env:
-      K3D_VERSION: v5.6.0
-      K8S_VERSION: ${{ github.event.inputs.k8s_version || '1.28.7' }}
-      ISTIO_VERSION: 1.20.3
-      CM_VERSION: v1.13.3
-      KLM_VERSION_TAG: latest
-      KLM_IMAGE_REPO: prod
-      GOSUMDB: off
-    steps:
-      - name: Install prerequisites
-        run: |
-          curl -fsSL https://pkgs.k8s.io/core:/stable:/v1.28/deb/Release.key | sudo gpg --batch --yes --dearmor -o /etc/apt/keyrings/kubernetes-apt-keyring.gpg
-          echo 'deb [signed-by=/etc/apt/keyrings/kubernetes-apt-keyring.gpg] https://pkgs.k8s.io/core:/stable:/v1.28/deb/ /' | sudo tee /etc/apt/sources.list.d/kubernetes.list
-          sudo apt update -y
-          sudo apt install kubectl -y
-      - name: Checkout lifecycle-manager
-        uses: actions/checkout@v4
-        with:
-          path: lifecycle-manager
-      - name: Set up Go
-        uses: actions/setup-go@v4
-        with:
-          go-version-file: 'lifecycle-manager/go.mod'
-          cache-dependency-path: 'lifecycle-manager/go.sum'
-      - name: Install Istio CLI
-        run: |
-          curl -L https://istio.io/downloadIstio | TARGET_ARCH=x86_64 sh -
-          chmod +x istio-$ISTIO_VERSION/bin/istioctl
-          mv istio-$ISTIO_VERSION/bin/istioctl /usr/local/bin
-      - name: Install Kyma CLI
-        run: |
-          wget https://storage.googleapis.com/kyma-cli-unstable/kyma-linux
-          chmod +x kyma-linux && mv kyma-linux /usr/local/bin/kyma-unstable
-          echo "PATH=/usr/local/bin/kyma-unstable" >> $GITHUB_OUTPUT
-      - run: ln -s /usr/local/bin/kyma-unstable /usr/local/bin/kyma
-      - name: Install Cert Manager Command Line Tool
-        run: |
-          OS=$(go env GOOS); ARCH=$(go env GOARCH); curl -fsSL -o cmctl.tar.gz https://github.com/cert-manager/cert-manager/releases/latest/download/cmctl-$OS-$ARCH.tar.gz
-          tar xzf cmctl.tar.gz
-          sudo mv cmctl /usr/local/bin
-      - name: Install k3d
-        run: wget -qO - https://raw.githubusercontent.com/k3d-io/k3d/main/install.sh | TAG=$K3D_VERSION bash
-      - name: Provision SKR cluster
-        run: |
-          k3d cluster create skr \
-            -p 10080:80@loadbalancer \
-            -p 10443:443@loadbalancer \
-            --image rancher/k3s:v$K8S_VERSION-k3s1 \
-            --k3s-arg '--disable=traefik@server:*' \
-            --k3s-arg '--tls-san=host.k3d.internal@server:*'
-      - name: Provision KCP cluster
-        run: |
-          k3d cluster create kcp \
-            -p 9443:443@loadbalancer \
-            -p 9080:80@loadbalancer \
-            -p 9081:8080@loadbalancer \
-            --image rancher/k3s:v$K8S_VERSION-k3s1 \
-            --registry-create k3d-kcp-registry:5111 \
-            --k3s-arg '--disable=traefik@server:*' \
-            --k3s-arg '--tls-san=host.k3d.internal@server:*'
-      - name: Update Kubeconfigs
-        run: k3d kubeconfig merge -a -d
-      - name: Export required Kubeconfig Env vars
-        run: |
-          echo "KCP_KUBECONFIG=$(k3d kubeconfig write kcp)" >> $GITHUB_ENV
-          echo "SKR_KUBECONFIG=$(k3d kubeconfig write skr)" >> $GITHUB_ENV
-      - name: Patch /etc/hosts
-        run: |
-          FILE=/etc/hosts
-          if [ -f "$FILE" ]; then
-              sudo echo "127.0.0.1 k3d-kcp-registry" | sudo tee -a $FILE
-          else
-              echo "$FILE does not exist."
-              exit 1
-          fi
-          echo "/etc/hosts file patched"
-      - name: Switch kubeconfig context to KCP cluster
-        run: kubectl config use-context k3d-kcp
-      - name: Deploy Istio on KCP Cluster
-        run: |
-          istioctl install --set profile=demo -y
-      - name: Deploy Cert Manager on KCP Cluster
-        run: |
-          kubectl apply -f https://github.com/cert-manager/cert-manager/releases/download/$CM_VERSION/cert-manager.yaml
-          cmctl check api --wait=2m
-      - name: Override Kustomize Controller Image TAG and Image repository environment variables in Pull Request to PR Image
-        if: ${{ github.event_name == 'pull_request' }}
-        run: |
-          echo "KLM_VERSION_TAG=PR-${{ github.event.pull_request.number }}" >> $GITHUB_ENV
-          echo "KLM_IMAGE_REPO=dev" >> $GITHUB_ENV
-      - name: Patch purge finalizer flags
-        if: ${{ matrix.e2e-test == 'purge-controller' ||  matrix.e2e-test == 'purge-metrics'}}
-        working-directory: lifecycle-manager
-        run: |
-          pushd config/watcher_local_test
-          echo \
-          "- op: add
-            path: /spec/template/spec/containers/0/args/-
-            value: --enable-purge-finalizer=true
-          - op: add
-            path: /spec/template/spec/containers/0/args/-
-            value: --purge-finalizer-timeout=5s" >> purge_finalizer.yaml
-          cat purge_finalizer.yaml
-          kustomize edit add patch --path purge_finalizer.yaml --kind Deployment
-          popd
-      - name: Patch metrics cleanup interval
-        if : ${{ matrix.e2e-test == 'kyma-metrics' }}
-        working-directory: lifecycle-manager
-        run: |
-          pushd config/watcher_local_test
-          echo \
-          "- op: add
-            path: /spec/template/spec/containers/0/args/-
-            value: --metrics-cleanup-interval=1" >> metrics_cleanup.yaml
-          cat metrics_cleanup.yaml
-          kustomize edit add patch --path metrics_cleanup.yaml --kind Deployment
-          popd
-      - name: Patch self signed certificate lifetime
-        if: ${{matrix.e2e-test == 'self-signed-certificate-rotation'}}
-        working-directory: lifecycle-manager
-        run: |
-          pushd config/watcher_local_test
-          echo \
-          "- op: add
-            path: /spec/template/spec/containers/0/args/-
-            value: --self-signed-cert-duration=1h
-          - op: add
-            path: /spec/template/spec/containers/0/args/-
-            value: --self-signed-cert-renew-before=59m
-          - op: add
-            path: /spec/template/spec/containers/0/args/-
-            value: --self-signed-cert-renew-buffer=1m" >> self-signed-cert.yaml
-          cat self-signed-cert.yaml
-          kustomize edit add patch --path self-signed-cert.yaml --kind Deployment
-          popd
-      - name: Patch CA certificate renewBefore
-        if: ${{matrix.e2e-test == 'ca-certificate-rotation'}}
-        working-directory: lifecycle-manager
-        run: |
-          pushd config/watcher_local_test
-          echo \
-          "- op: replace
-            path: /spec/renewBefore
-            value: 59m 
-          - op: replace
-            path: /spec/duration
-            value: 1h">> certificate_renewal.yaml
-          cat certificate_renewal.yaml
-          kustomize edit add patch --path certificate_renewal.yaml --kind Certificate --group cert-manager.io --version v1 --name watcher-serving-cert
-          popd
-      - name: Deploy LM local testing kustomize
-        working-directory: lifecycle-manager
-        run: |
-          maxRetry=5
-          for retry in $(seq 1 $maxRetry)
-          do
-            if make local-deploy-with-watcher IMG=europe-docker.pkg.dev/kyma-project/$KLM_IMAGE_REPO/lifecycle-manager:$KLM_VERSION_TAG; then
-              kubectl wait pods -n kcp-system -l app.kubernetes.io/name=lifecycle-manager --for condition=Ready --timeout=90s
-              echo "KLM deployed successfully"
-              exit 0
-            elif [[ $retry -lt $maxRetry ]]; then
-              echo "Deploy encountered some error, will retry after 20 seconds"
-              sleep 20
-            else
-              echo "KLM deployment failed"
-              exit 1
-            fi
-          done
-      - name: Checkout template-operator
-        uses: actions/checkout@v4
-        with:
-          repository: kyma-project/template-operator
-          path: template-operator
-      - name: Create Template Operator Module and apply
-        working-directory: template-operator
-        if: ${{ matrix.e2e-test == 'kyma-metrics' ||
-          matrix.e2e-test == 'non-blocking-deletion' ||
-          matrix.e2e-test == 'purge-controller' ||
-          matrix.e2e-test == 'purge-metrics' ||
-          matrix.e2e-test == 'kyma-deprovision-with-foreground-propagation' ||
-          matrix.e2e-test == 'kyma-deprovision-with-background-propagation' ||
-          matrix.e2e-test == 'module-consistency' ||
-          matrix.e2e-test == 'skip-manifest-reconciliation' ||
-          matrix.e2e-test == 'misconfigured-kyma-secret'
-          }}
-        run: |
-          make build-manifests
-          kyma alpha create module --module-config-file ./module-config.yaml --path . --registry k3d-kcp-registry:5111 --insecure
-          sed -i 's/k3d-kcp-registry:5111/k3d-kcp-registry:5000/g' ./template.yaml
-          kubectl config use-context k3d-kcp
-          kubectl get crds
-          kubectl apply -f template.yaml
-      - name: Create Template Operator Module for regular and fast channels
-        working-directory: lifecycle-manager
-        if: ${{ matrix.e2e-test == 'module-upgrade-channel-switch' || 
-          matrix.e2e-test == 'module-upgrade-new-version' || 
-          matrix.e2e-test == 'upgrade-under-deletion' 
-          }}
-        run: |
-          kubectl apply -f tests/moduletemplates/moduletemplate_template_operator_v2_fast.yaml
-          kubectl apply -f tests/moduletemplates/moduletemplate_template_operator_v1_regular.yaml
-      - name: Create Template Operator Module as Mandatory Module
-        working-directory: lifecycle-manager
-        if: ${{ matrix.e2e-test == 'mandatory-module' ||
-          matrix.e2e-test == 'mandatory-module-metrics' 
-          }}
-        run: |
-          kubectl apply -f tests/moduletemplates/mandatory_moduletemplate_template_operator_v1.yaml
-      - name: Apply Template Operator Module V2, fast channel
-        working-directory: ./lifecycle-manager
-        if: ${{ matrix.e2e-test == 'non-blocking-deletion' }}
-        run: |
-          kubectl apply -f tests/moduletemplates/moduletemplate_template_operator_v2_fast.yaml
-      - name: Create Template Operator Module with final state and final deletion state as `Warning` and apply
-        working-directory: template-operator
-        if: ${{ matrix.e2e-test == 'module-status-propagation'}}
-        run: |
-          pushd config/default
-          echo \
-          "- op: replace
-            path: /spec/template/spec/containers/0/args/1
-            value: --final-state=Warning
-          - op: replace
-            path: /spec/template/spec/containers/0/args/2
-            value: --final-deletion-state=Warning" >> warning_patch.yaml
-          cat warning_patch.yaml
-          kustomize edit add patch --path warning_patch.yaml --kind Deployment
-          popd
-          kyma alpha create module --kubebuilder-project  --channel=regular --name kyma.project.io/module/template-operator --version 1.1.1 --path . --registry k3d-kcp-registry:5111 --insecure --module-archive-version-overwrite /
-          sed -i 's/k3d-kcp-registry:5111/k3d-kcp-registry:5000/g' ./template.yaml
-          kubectl config use-context k3d-kcp
-          kubectl get crds
-          kubectl apply -f template.yaml
-      - name: Create Template Operator Module without default CR and apply
-        working-directory: template-operator
-        if: ${{ matrix.e2e-test == 'module-without-default-cr' }}
-        run: |
-          make build-manifests
-          echo "name: kyma-project.io/module/template-operator
-          channel: regular
-          version: v1.0.0
-          manifest: template-operator.yaml
-          security: sec-scanners-config.yaml
-          annotations:
-            operator.kyma-project.io/doc-url: https://kyma-project.io" >> module-config-no-cr.yaml
-          kyma alpha create module \
-          --module-config-file ./module-config-no-cr.yaml \
-          --path . \
-          --registry k3d-kcp-registry:5111 \
-          --insecure
-          sed -i 's/k3d-kcp-registry:5111/k3d-kcp-registry:5000/g' ./template.yaml
-          kubectl config use-context k3d-kcp
-          kubectl get crds
-          kubectl apply -f template.yaml
-      - name: Expose Metrics Endpoint
-        working-directory: lifecycle-manager
-        if: ${{ matrix.e2e-test == 'kyma-metrics' ||
-          matrix.e2e-test == 'purge-metrics' ||
-          matrix.e2e-test == 'self-signed-certificate-rotation' ||
-          matrix.e2e-test == 'mandatory-module-metrics'
-          }}
-        run: |
-          kubectl patch svc klm-metrics-service -p '{"spec": {"type": "LoadBalancer"}}' -n kcp-system
-      - name: Run ${{ matrix.e2e-test }}
-        working-directory: lifecycle-manager
-        run: |
-          make -C tests/e2e ${{ matrix.e2e-test }}