diff --git a/cardano-cli/src/Cardano/CLI/EraBased/Run/Transaction.hs b/cardano-cli/src/Cardano/CLI/EraBased/Run/Transaction.hs
index 46a9042ab6..e4174ea24b 100644
--- a/cardano-cli/src/Cardano/CLI/EraBased/Run/Transaction.hs
+++ b/cardano-cli/src/Cardano/CLI/EraBased/Run/Transaction.hs
@@ -766,9 +766,11 @@ toTxOutInAnyEra era (TxOutAnyEra addr' val' mDatumHash refScriptFp) = do
         TxOutDatumByValue sDataOrFile -> do
           sData <- firstExceptT TxCmdScriptDataError $ readScriptDataOrFile sDataOrFile
           pure (TxOutDatumInTx supp sData)
-        TxOutInlineDatumByValue _ ->
-          txFeatureMismatch era TxFeatureInlineDatums
-
+        TxOutInlineDatumByValue sDataOrFile -> do
+          let cEra = alonzoEraOnwardsToCardanoEra supp
+          babbageOnwards <- maybe (txFeatureMismatch cEra TxFeatureInlineDatums) pure $ forEraMaybeEon cEra
+          sData <- firstExceptT TxCmdScriptDataError $ readScriptDataOrFile sDataOrFile
+          pure $ TxOutDatumInline babbageOnwards sData
 
 -- TODO: Currently we specify the policyId with the '--mint' option on the cli
 -- and we added a separate '--policy-id' parser that parses the policy id for the