diff --git a/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceContextServiceCEImpl.java b/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceContextServiceCEImpl.java
index 93babde9a1..9ebea2c22b 100644
--- a/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceContextServiceCEImpl.java
+++ b/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceContextServiceCEImpl.java
@@ -116,7 +116,7 @@ public class DatasourceContextServiceCEImpl implements DatasourceContextServiceC
                                     .setAuthentication(
                                             ((UpdatableConnection) connection).getAuthenticationDTO(
                                                     datasource.getDatasourceConfiguration().getAuthentication()));
-                            datasourceMono1 = datasourceService.update(datasource.getId(), datasource);
+                            datasourceMono1 = datasourceService.update(datasource.getId(), datasource, Boolean.TRUE);
                         }
                         return datasourceMono1.thenReturn(connection);
                     })
diff --git a/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceServiceCE.java b/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceServiceCE.java
index ed668eae23..8f68633a68 100644
--- a/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceServiceCE.java
+++ b/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceServiceCE.java
@@ -33,5 +33,8 @@ public interface DatasourceServiceCE extends CrudService<Datasource, String> {
 
     Mono<Datasource> populateHintMessages(Datasource datasource);
 
+    Mono<Datasource> update(String datasourceId, Datasource datasource, Boolean isServerRefreshedUpdate);
+
     Mono<Datasource> getValidDatasourceFromActionMono(ActionDTO actionDTO, AclPermission aclPermission);
+
 }
diff --git a/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceServiceCEImpl.java b/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceServiceCEImpl.java
index 221883da13..1b00df0c73 100644
--- a/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceServiceCEImpl.java
+++ b/app/server/appsmith-server/src/main/java/com/appsmith/server/services/ce/DatasourceServiceCEImpl.java
@@ -198,6 +198,13 @@ public class DatasourceServiceCEImpl extends BaseService<DatasourceRepository, D
 
     @Override
     public Mono<Datasource> update(String id, Datasource datasource) {
+        // since there was no datasource update differentiator between server invoked due to refresh token,
+        // and user invoked. Hence the update is overloaded to provide the boolean for key diff.
+        // since the base controller uses the default method from CRUD interface, we are adding keys manually for the user invoked flow
+        return update(id, datasource, Boolean.FALSE);
+    }
+
+    public Mono<Datasource> update(String id, Datasource datasource, Boolean isServerRefreshedUpdate) {
         if (id == null) {
             return Mono.error(new AppsmithException(AppsmithError.INVALID_PARAMETER, FieldName.ID));
         }
@@ -207,6 +214,7 @@ public class DatasourceServiceCEImpl extends BaseService<DatasourceRepository, D
 
         Mono<Datasource> datasourceMono = repository.findById(id)
                 .switchIfEmpty(Mono.error(new AppsmithException(AppsmithError.NO_RESOURCE_FOUND, FieldName.DATASOURCE, id)));
+
         return datasourceMono
                 .map(dbDatasource -> {
                     copyNestedNonNullProperties(datasource, dbDatasource);
@@ -218,9 +226,19 @@ public class DatasourceServiceCEImpl extends BaseService<DatasourceRepository, D
                     return dbDatasource;
                 })
                 .flatMap(this::validateAndSaveDatasourceToRepository)
-                .flatMap(savedDatasource ->
-                        analyticsService.sendUpdateEvent(savedDatasource, getAnalyticsProperties(savedDatasource))
-                )
+                .flatMap(savedDatasource -> {
+
+                    // this key will present in the analytics as a diff b/w server and user invoked flows
+                    String isDatasourceUpdateServerInvokedKey = "isDatasourceUpdateServerInvoked";
+                    Map<String, Object> analyticsProperties = getAnalyticsProperties(savedDatasource);
+
+                    if (isServerRefreshedUpdate.equals(Boolean.TRUE)) {
+                        analyticsProperties.put(isDatasourceUpdateServerInvokedKey, Boolean.TRUE);
+                    } else {
+                        analyticsProperties.put(isDatasourceUpdateServerInvokedKey, Boolean.FALSE);
+                    }
+                    return analyticsService.sendUpdateEvent(savedDatasource, analyticsProperties);
+                })
                 .flatMap(this::populateHintMessages);
     }
 
@@ -302,13 +320,13 @@ public class DatasourceServiceCEImpl extends BaseService<DatasourceRepository, D
                 .map(this::sanitizeDatasource)
                 .flatMap(this::validateDatasource)
                 .flatMap(unsavedDatasource -> {
-
-                    return repository.save(unsavedDatasource).map(savedDatasource -> {
-                        // datasource.pluginName is a transient field. It was set by validateDatasource method
-                        // object from db will have pluginName=null so set it manually from the unsaved datasource obj
-                        savedDatasource.setPluginName(unsavedDatasource.getPluginName());
-                        return savedDatasource;
-                    });
+                    return repository.save(unsavedDatasource)
+                            .map(savedDatasource -> {
+                                // datasource.pluginName is a transient field. It was set by validateDatasource method
+                                // object from db will have pluginName=null so set it manually from the unsaved datasource obj
+                                savedDatasource.setPluginName(unsavedDatasource.getPluginName());
+                                return savedDatasource;
+                            });
                 });
     }
 
diff --git a/app/server/appsmith-server/src/main/java/com/appsmith/server/solutions/ce/AuthenticationServiceCEImpl.java b/app/server/appsmith-server/src/main/java/com/appsmith/server/solutions/ce/AuthenticationServiceCEImpl.java
index 96135adb8f..02c518d02f 100644
--- a/app/server/appsmith-server/src/main/java/com/appsmith/server/solutions/ce/AuthenticationServiceCEImpl.java
+++ b/app/server/appsmith-server/src/main/java/com/appsmith/server/solutions/ce/AuthenticationServiceCEImpl.java
@@ -255,7 +255,7 @@ public class AuthenticationServiceCEImpl implements AuthenticationServiceCE {
                                 }
                                 oAuth2.setAuthenticationResponse(authenticationResponse);
                                 datasource.getDatasourceConfiguration().setAuthentication(oAuth2);
-                                return datasourceService.update(datasource.getId(), datasource);
+                                return datasourceService.update(datasource.getId(), datasource, Boolean.TRUE);
                             });
                 })
                 // We have no use of the datasource object during redirection, we merely send the response as a success state
@@ -367,7 +367,7 @@ public class AuthenticationServiceCEImpl implements AuthenticationServiceCE {
                                         .getDatasourceConfiguration()
                                         .getAuthentication()
                                         .setAuthenticationStatus(AuthenticationDTO.AuthenticationStatus.IN_PROGRESS);
-                                return datasourceService.update(datasource.getId(), datasource).thenReturn(appsmithToken);
+                                return datasourceService.update(datasource.getId(), datasource, Boolean.TRUE).thenReturn(appsmithToken);
                             })
                             .onErrorMap(ConnectException.class,
                                     error -> new AppsmithException(
@@ -432,7 +432,7 @@ public class AuthenticationServiceCEImpl implements AuthenticationServiceCE {
                                 return Mono.just(datasource);
                             });
                 })
-                .flatMap(datasource -> datasourceService.update(datasource.getId(), datasource))
+                .flatMap(datasource -> datasourceService.update(datasource.getId(), datasource, Boolean.TRUE))
                 .onErrorMap(ConnectException.class,
                         error -> new AppsmithException(
                                 AppsmithError.AUTHENTICATION_FAILURE,
@@ -479,7 +479,7 @@ public class AuthenticationServiceCEImpl implements AuthenticationServiceCE {
                                 // We return the same object instead of the update value because the updates value
                                 // will be in the encrypted form
                                 return datasourceService
-                                        .update(datasource.getId(), datasource)
+                                        .update(datasource.getId(), datasource, Boolean.TRUE)
                                         .thenReturn(datasource);
                             });
                 })