diff --git a/ChangeLog.d/fix_kdf_incorrect_initial_capacity.txt b/ChangeLog.d/fix_kdf_incorrect_initial_capacity.txt
new file mode 100644
index 0000000000..11b82782fb
--- /dev/null
+++ b/ChangeLog.d/fix_kdf_incorrect_initial_capacity.txt
@@ -0,0 +1,3 @@
+Bugfix
+   * Correct initial capacities for key derivation algorithms:TLS12_PRF,
+     TLS12_PSK_TO_MS
diff --git a/library/psa_crypto.c b/library/psa_crypto.c
index 533ded6ff9..ec5934e0e0 100644
--- a/library/psa_crypto.c
+++ b/library/psa_crypto.c
@@ -4375,21 +4375,10 @@ static psa_status_t psa_hash_try_support(psa_algorithm_t alg)
     return status;
 }
 
-static psa_status_t psa_key_derivation_setup_kdf(
+static psa_status_t psa_key_derivation_set_maximum_capacity(
     psa_key_derivation_operation_t *operation,
     psa_algorithm_t kdf_alg)
 {
-    /* Make sure that operation->ctx is properly zero-initialised. (Macro
-     * initialisers for this union leave some bytes unspecified.) */
-    memset(&operation->ctx, 0, sizeof(operation->ctx));
-
-    /* Make sure that kdf_alg is a supported key derivation algorithm. */
-    if (!is_kdf_alg_supported(kdf_alg)) {
-        return PSA_ERROR_NOT_SUPPORTED;
-    }
-
-    /* All currently supported key derivation algorithms are based on a
-     * hash algorithm. */
     psa_algorithm_t hash_alg = PSA_ALG_HKDF_GET_HASH(kdf_alg);
     size_t hash_size = PSA_HASH_LENGTH(hash_alg);
     if (hash_size == 0) {
@@ -4404,14 +4393,48 @@ static psa_status_t psa_key_derivation_setup_kdf(
         return status;
     }
 
-    if ((PSA_ALG_IS_TLS12_PRF(kdf_alg) ||
-         PSA_ALG_IS_TLS12_PSK_TO_MS(kdf_alg)) &&
-        !(hash_alg == PSA_ALG_SHA_256 || hash_alg == PSA_ALG_SHA_384)) {
+#if defined(PSA_WANT_ALG_HKDF)
+    if (PSA_ALG_IS_HKDF(kdf_alg)) {
+        operation->capacity = 255 * hash_size;
+    } else
+#endif
+#if defined(PSA_WANT_ALG_TLS12_PRF)
+    if (PSA_ALG_IS_TLS12_PRF(kdf_alg) &&
+        (hash_alg == PSA_ALG_SHA_256 || hash_alg == PSA_ALG_SHA_384)) {
+        operation->capacity = SIZE_MAX;
+    } else
+#endif
+#if defined(PSA_WANT_ALG_TLS12_PSK_TO_MS)
+    if (PSA_ALG_IS_TLS12_PSK_TO_MS(kdf_alg) &&
+        (hash_alg == PSA_ALG_SHA_256 || hash_alg == PSA_ALG_SHA_384)) {
+        /* Master Secret is always 48 bytes
+         * https://datatracker.ietf.org/doc/html/rfc5246.html#section-8.1 */
+        operation->capacity = 48U;
+    } else
+#endif
+    {
+        (void) hash_size;
+        status = PSA_ERROR_NOT_SUPPORTED;
+    }
+    return status;
+}
+
+
+static psa_status_t psa_key_derivation_setup_kdf(
+    psa_key_derivation_operation_t *operation,
+    psa_algorithm_t kdf_alg)
+{
+    /* Make sure that operation->ctx is properly zero-initialised. (Macro
+     * initialisers for this union leave some bytes unspecified.) */
+    memset(&operation->ctx, 0, sizeof(operation->ctx));
+    /* Make sure that kdf_alg is a supported key derivation algorithm. */
+    if (!is_kdf_alg_supported(kdf_alg)) {
         return PSA_ERROR_NOT_SUPPORTED;
     }
 
-    operation->capacity = 255 * hash_size;
-    return PSA_SUCCESS;
+    psa_status_t status = psa_key_derivation_set_maximum_capacity(operation,
+                                                                  kdf_alg);
+    return status;
 }
 
 static psa_status_t psa_key_agreement_try_support(psa_algorithm_t alg)
diff --git a/tests/suites/test_suite_psa_crypto.data b/tests/suites/test_suite_psa_crypto.data
index 03cc2ffe67..718b10c5dc 100644
--- a/tests/suites/test_suite_psa_crypto.data
+++ b/tests/suites/test_suite_psa_crypto.data
@@ -3597,6 +3597,25 @@ PSA key derivation: HKDF SHA-1, request too much capacity
 depends_on:PSA_WANT_ALG_HKDF:PSA_WANT_ALG_SHA_1
 derive_set_capacity:PSA_ALG_HKDF(PSA_ALG_SHA_1):255 * PSA_HASH_LENGTH(PSA_ALG_SHA_1) + 1:PSA_ERROR_INVALID_ARGUMENT
 
+# TLS 1.2 PRF does not have a maximum capacity therefore
+# derive_set_capacity negative test case is not added
+
+PSA key derivation: TLS 1.2 PSK-to-MS SHA-256, request too much capacity
+depends_on:PSA_WANT_ALG_SHA_256:PSA_WANT_ALG_TLS12_PSK_TO_MS
+derive_set_capacity:PSA_ALG_TLS12_PSK_TO_MS(PSA_ALG_SHA_256):48U + 1U:PSA_ERROR_INVALID_ARGUMENT
+
+PSA key derivation: TLS 1.2 PSK-to-MS SHA-384, request too much capacity
+depends_on:PSA_WANT_ALG_SHA_384:PSA_WANT_ALG_TLS12_PSK_TO_MS
+derive_set_capacity:PSA_ALG_TLS12_PSK_TO_MS(PSA_ALG_SHA_384):48U + 1U:PSA_ERROR_INVALID_ARGUMENT
+
+PSA key derivation: TLS 1.2 PRF SHA-256, request maximum capacity
+depends_on:PSA_WANT_ALG_TLS12_PRF:PSA_WANT_ALG_SHA_256
+derive_set_capacity:PSA_ALG_TLS12_PRF(PSA_ALG_SHA_256):SIZE_MAX:PSA_SUCCESS
+
+PSA key derivation: TLS 1.2 PRF SHA-384, request maximum capacity
+depends_on:PSA_WANT_ALG_TLS12_PRF:PSA_WANT_ALG_SHA_384
+derive_set_capacity:PSA_ALG_TLS12_PRF(PSA_ALG_SHA_384):SIZE_MAX:PSA_SUCCESS
+
 PSA key derivation: over capacity 42: output 42+1
 depends_on:PSA_WANT_ALG_HKDF:PSA_WANT_ALG_SHA_256
 derive_output:PSA_ALG_HKDF(PSA_ALG_SHA_256):PSA_KEY_DERIVATION_INPUT_SALT:"000102030405060708090a0b0c":PSA_KEY_DERIVATION_INPUT_SECRET:"0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b":PSA_KEY_DERIVATION_INPUT_INFO:"f0f1f2f3f4f5f6f7f8f9":42:"3cb25f25faacd57a90434f64d0362f2a2d2d0a90cf1a5a4c5db02d56ecc4c5bf34007208d5b887185865":"ff"
@@ -3617,17 +3636,33 @@ PSA key derivation: HKDF SHA-256, read maximum capacity minus 1
 depends_on:PSA_WANT_ALG_HKDF:PSA_WANT_ALG_SHA_256
 derive_full:PSA_ALG_HKDF(PSA_ALG_SHA_256):"0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b":"000102030405060708090a0b0c":"f0f1f2f3f4f5f6f7f8f9":255 * PSA_HASH_LENGTH(PSA_ALG_SHA_256) - 1
 
+PSA key derivation: HKDF SHA-512, read maximum capacity minus 1
+depends_on:PSA_WANT_ALG_HKDF:PSA_WANT_ALG_SHA_512
+derive_full:PSA_ALG_HKDF(PSA_ALG_SHA_512):"0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b":"000102030405060708090a0b0c":"f0f1f2f3f4f5f6f7f8f9":255 * PSA_HASH_LENGTH(PSA_ALG_SHA_512) - 1
+
 PSA key derivation: HKDF SHA-256, read maximum capacity
 depends_on:PSA_WANT_ALG_HKDF:PSA_WANT_ALG_SHA_256
 derive_full:PSA_ALG_HKDF(PSA_ALG_SHA_256):"0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b":"000102030405060708090a0b0c":"f0f1f2f3f4f5f6f7f8f9":255 * PSA_HASH_LENGTH(PSA_ALG_SHA_256)
 
-PSA key derivation: TLS 1.2 PRF SHA-256, read maximum capacity minus 1
-depends_on:PSA_WANT_ALG_SHA_256:PSA_WANT_ALG_TLS12_PRF
-derive_full:PSA_ALG_TLS12_PRF(PSA_ALG_SHA_256):"0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b":"000102030405060708090a0b0c":"f0f1f2f3f4f5f6f7f8f9":255 * PSA_HASH_LENGTH(PSA_ALG_SHA_256) - 1
+PSA key derivation: HKDF SHA-512, read maximum capacity
+depends_on:PSA_WANT_ALG_HKDF:PSA_WANT_ALG_SHA_512
+derive_full:PSA_ALG_HKDF(PSA_ALG_SHA_512):"0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b":"000102030405060708090a0b0c":"f0f1f2f3f4f5f6f7f8f9":255 * PSA_HASH_LENGTH(PSA_ALG_SHA_512)
 
-PSA key derivation: TLS 1.2 PRF SHA-256, read maximum capacity
-depends_on:PSA_WANT_ALG_SHA_256:PSA_WANT_ALG_TLS12_PRF
-derive_full:PSA_ALG_TLS12_PRF(PSA_ALG_SHA_256):"0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b0b":"000102030405060708090a0b0c":"f0f1f2f3f4f5f6f7f8f9":255 * PSA_HASH_LENGTH(PSA_ALG_SHA_256)
+PSA key derivation: TLS 1.2 PSK-to-MS SHA-256, read maximum capacity minus 1
+depends_on:PSA_WANT_ALG_SHA_256:PSA_WANT_ALG_TLS12_PSK_TO_MS
+derive_full:PSA_ALG_TLS12_PSK_TO_MS(PSA_ALG_SHA_256):"01020304":"5bc0b19b4a8b24b07afe7ec65c471e94a7d518fcef06c3574315255c52afe21b5bc0b19b872b9b26508458f03603744d575f463a11ae7f1b090c012606fd3e9f":"6d617374657220736563726574":47
+
+PSA key derivation: TLS 1.2 PSK-to-MS SHA-384, read maximum capacity minus 1
+depends_on:PSA_WANT_ALG_SHA_384:PSA_WANT_ALG_TLS12_PSK_TO_MS
+derive_full:PSA_ALG_TLS12_PSK_TO_MS(PSA_ALG_SHA_384):"01020304":"5bc0b19b4a8b24b07afe7ec65c471e94a7d518fcef06c3574315255c52afe21b5bc0b19b872b9b26508458f03603744d575f463a11ae7f1b090c012606fd3e9f":"6d617374657220736563726574":47
+
+PSA key derivation: TLS 1.2 PSK-to-MS SHA-256, read maximum capacity
+depends_on:PSA_WANT_ALG_SHA_256:PSA_WANT_ALG_TLS12_PSK_TO_MS
+derive_full:PSA_ALG_TLS12_PSK_TO_MS(PSA_ALG_SHA_256):"01020304":"5bc0b19b4a8b24b07afe7ec65c471e94a7d518fcef06c3574315255c52afe21b5bc0b19b872b9b26508458f03603744d575f463a11ae7f1b090c012606fd3e9f":"6d617374657220736563726574":48
+
+PSA key derivation: TLS 1.2 PSK-to-MS SHA-384, read maximum capacity
+depends_on:PSA_WANT_ALG_SHA_384:PSA_WANT_ALG_TLS12_PSK_TO_MS
+derive_full:PSA_ALG_TLS12_PSK_TO_MS(PSA_ALG_SHA_384):"01020304":"5bc0b19b4a8b24b07afe7ec65c471e94a7d518fcef06c3574315255c52afe21b5bc0b19b872b9b26508458f03603744d575f463a11ae7f1b090c012606fd3e9f":"6d617374657220736563726574":48
 
 PSA key derivation: HKDF SHA-256, exercise AES128-CTR
 depends_on:PSA_WANT_ALG_CTR:PSA_WANT_ALG_HKDF:PSA_WANT_ALG_SHA_256:PSA_WANT_KEY_TYPE_AES
diff --git a/tests/suites/test_suite_psa_crypto.function b/tests/suites/test_suite_psa_crypto.function
index 0db5bff79a..21b768bd3a 100644
--- a/tests/suites/test_suite_psa_crypto.function
+++ b/tests/suites/test_suite_psa_crypto.function
@@ -4466,7 +4466,7 @@ exit:
 /* END_CASE */
 
 /* BEGIN_CASE */
-void derive_set_capacity(int alg_arg, int capacity_arg,
+void derive_set_capacity(int alg_arg, int64_t capacity_arg,
                          int expected_status_arg)
 {
     psa_algorithm_t alg = alg_arg;
@@ -4788,7 +4788,7 @@ void derive_full(int alg_arg,
     psa_algorithm_t alg = alg_arg;
     size_t requested_capacity = requested_capacity_arg;
     psa_key_derivation_operation_t operation = PSA_KEY_DERIVATION_OPERATION_INIT;
-    unsigned char output_buffer[16];
+    unsigned char output_buffer[32];
     size_t expected_capacity = requested_capacity;
     size_t current_capacity;
     psa_key_attributes_t attributes = PSA_KEY_ATTRIBUTES_INIT;