diff --git a/CHANGELOG.md b/CHANGELOG.md
index 07510f643c..17daa10f08 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -28,6 +28,8 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
   ([#2823](https://github.com/open-telemetry/opentelemetry-python-contrib/pull/2823))
 - `opentelemetry-instrumentation-system-metrics` fix `process.runtime.cpu.utilization` values to be shown in range of 0 to 1
   ([#2812](https://github.com/open-telemetry/opentelemetry-python-contrib/pull/2812))
+- `opentelemetry-instrumentation-psycopg2` Fix psycopg2 instrument issue
+  ([#2795](https://github.com/open-telemetry/opentelemetry-python-contrib/pull/2795))
 - `opentelemetry-instrumentation-fastapi` fix `fastapi` auto-instrumentation by removing `fastapi-slim` support, `fastapi-slim` itself is discontinued from maintainers
   ([#2783](https://github.com/open-telemetry/opentelemetry-python-contrib/pull/2783))
 - `opentelemetry-instrumentation-aws-lambda` Avoid exception when a handler is not present.
diff --git a/instrumentation/opentelemetry-instrumentation-psycopg2/src/opentelemetry/instrumentation/psycopg2/__init__.py b/instrumentation/opentelemetry-instrumentation-psycopg2/src/opentelemetry/instrumentation/psycopg2/__init__.py
index de2e49f4c3..f2c20a43d7 100644
--- a/instrumentation/opentelemetry-instrumentation-psycopg2/src/opentelemetry/instrumentation/psycopg2/__init__.py
+++ b/instrumentation/opentelemetry-instrumentation-psycopg2/src/opentelemetry/instrumentation/psycopg2/__init__.py
@@ -110,6 +110,7 @@
     cursor as pg_cursor,  # pylint: disable=no-name-in-module
 )
 from psycopg2.sql import Composed  # pylint: disable=no-name-in-module
+from wrapt import ObjectProxy
 
 from opentelemetry.instrumentation import dbapi
 from opentelemetry.instrumentation.instrumentor import BaseInstrumentor
@@ -158,24 +159,25 @@ def _uninstrument(self, **kwargs):
         dbapi.unwrap_connect(psycopg2, "connect")
 
     # TODO(owais): check if core dbapi can do this for all dbapi implementations e.g, pymysql and mysql
-    @staticmethod
-    def instrument_connection(connection, tracer_provider=None):
-        if not hasattr(connection, "_is_instrumented_by_opentelemetry"):
-            connection._is_instrumented_by_opentelemetry = False
-
-        if not connection._is_instrumented_by_opentelemetry:
-            setattr(
-                connection, _OTEL_CURSOR_FACTORY_KEY, connection.cursor_factory
-            )
-            connection.cursor_factory = _new_cursor_factory(
-                tracer_provider=tracer_provider
-            )
-            connection._is_instrumented_by_opentelemetry = True
-        else:
+    def instrument_connection(self, connection, tracer_provider=None):
+        if isinstance(connection, ObjectProxy):
             _logger.warning(
                 "Attempting to instrument Psycopg connection while already instrumented"
             )
-        return connection
+            return connection
+
+        db_integration = DatabaseApiIntegration(
+            __name__,
+            self._DATABASE_SYSTEM,
+            connection_attributes=self._CONNECTION_ATTRIBUTES,
+            version=__version__,
+            tracer_provider=tracer_provider,
+        )
+        db_integration.get_connection_attributes(connection)
+        db_integration.cursor_factory = _new_cursor_factory(
+            tracer_provider=tracer_provider
+        )
+        return dbapi.get_traced_connection_proxy(connection, db_integration)
 
     # TODO(owais): check if core dbapi can do this for all dbapi implementations e.g, pymysql and mysql
     @staticmethod
@@ -184,7 +186,7 @@ def uninstrument_connection(connection):
             connection, _OTEL_CURSOR_FACTORY_KEY, None
         )
 
-        return connection
+        return dbapi.uninstrument_connection(connection)
 
 
 # TODO(owais): check if core dbapi can do this for all dbapi implementations e.g, pymysql and mysql
diff --git a/instrumentation/opentelemetry-instrumentation-psycopg2/tests/test_psycopg2_integration.py b/instrumentation/opentelemetry-instrumentation-psycopg2/tests/test_psycopg2_integration.py
index 6671073043..939075d5cb 100644
--- a/instrumentation/opentelemetry-instrumentation-psycopg2/tests/test_psycopg2_integration.py
+++ b/instrumentation/opentelemetry-instrumentation-psycopg2/tests/test_psycopg2_integration.py
@@ -191,6 +191,7 @@ def test_instrument_connection(self):
         self.assertEqual(len(spans_list), 0)
 
         cnx = Psycopg2Instrumentor().instrument_connection(cnx)
+        self.assertFalse(hasattr(cnx, "_is_instrumented_by_opentelemetry"))
         cursor = cnx.cursor()
         cursor.execute(query)
 
@@ -209,6 +210,7 @@ def test_instrument_connection_with_instrument(self):
 
         Psycopg2Instrumentor().instrument()
         cnx = Psycopg2Instrumentor().instrument_connection(cnx)
+        self.assertFalse(hasattr(cnx, "_is_instrumented_by_opentelemetry"))
         cursor = cnx.cursor()
         cursor.execute(query)
 
@@ -236,7 +238,7 @@ def test_uninstrument_connection_with_instrument(self):
     # pylint: disable=unused-argument
     def test_uninstrument_connection_with_instrument_connection(self):
         cnx = psycopg2.connect(database="test")
-        Psycopg2Instrumentor().instrument_connection(cnx)
+        cnx = Psycopg2Instrumentor().instrument_connection(cnx)
         query = "SELECT * FROM test"
         cursor = cnx.cursor()
         cursor.execute(query)
@@ -281,3 +283,30 @@ def test_no_op_tracer_provider(self):
         cursor.execute(query)
         spans_list = self.memory_exporter.get_finished_spans()
         self.assertEqual(len(spans_list), 0)
+
+    # pylint: disable=unused-argument
+    def test_duplicated_instrumentation_works(self):
+        cnx = psycopg2.connect(database="test")
+        query = "SELECT * FROM test"
+        cursor = cnx.cursor()
+        cursor.execute(query)
+
+        spans_list = self.memory_exporter.get_finished_spans()
+        self.assertEqual(len(spans_list), 0)
+
+        Psycopg2Instrumentor().instrument()
+        Psycopg2Instrumentor().instrument()
+        cnx = Psycopg2Instrumentor().instrument_connection(cnx)
+        self.assertFalse(hasattr(cnx, "_is_instrumented_by_opentelemetry"))
+        cursor = cnx.cursor()
+        cursor.execute(query)
+
+        spans_list = self.memory_exporter.get_finished_spans()
+        self.assertEqual(len(spans_list), 1)
+
+        cnx = Psycopg2Instrumentor().uninstrument_connection(cnx)
+        cursor = cnx.cursor()
+        cursor.execute(query)
+
+        spans_list = self.memory_exporter.get_finished_spans()
+        self.assertEqual(len(spans_list), 1)