diff --git a/core/runtime/TRTEngine.cpp b/core/runtime/TRTEngine.cpp
index 5a5c1ad83d..52ac58dae5 100644
--- a/core/runtime/TRTEngine.cpp
+++ b/core/runtime/TRTEngine.cpp
@@ -307,6 +307,9 @@ bool TRTEngine::set_device_memory_budget(int64_t budget) {
   if (profile_execution) {
     enable_profiling();
   }
+  // Indicates to reevaluate the runtime settings
+  has_context_changed = true;
+
   return result;
 }
 
diff --git a/core/runtime/TRTEngine.h b/core/runtime/TRTEngine.h
index 88fb7ab275..9d8b7a91ba 100644
--- a/core/runtime/TRTEngine.h
+++ b/core/runtime/TRTEngine.h
@@ -102,6 +102,7 @@ struct TRTEngine : torch::CustomClassHolder {
   std::vector<at::Tensor> input_buffers = {};
   std::vector<at::Tensor> output_buffers = {};
   std::string shape_key;
+  bool has_context_changed = false;
 
   // TODO: Implement a call method
   // c10::List<at::Tensor> Run(c10::List<at::Tensor> inputs);
diff --git a/core/runtime/execute_engine.cpp b/core/runtime/execute_engine.cpp
index a7908468f4..7aef810818 100644
--- a/core/runtime/execute_engine.cpp
+++ b/core/runtime/execute_engine.cpp
@@ -115,11 +115,15 @@ std::vector<at::Tensor> execute_engine(std::vector<at::Tensor> inputs, c10::intr
   }
 
   // Whether cudagraphs needs to record the graph on this pass
-  bool need_cudagraphs_record = (CUDAGRAPHS_MODE && (!_cudagraphs_validate_shapes(inputs, compiled_engine)));
+  bool need_cudagraphs_record =
+      (CUDAGRAPHS_MODE &&
+       (!_cudagraphs_validate_shapes(inputs, compiled_engine) || compiled_engine->has_context_changed));
 
-  if (!CUDAGRAPHS_MODE) {
+  if (!CUDAGRAPHS_MODE || compiled_engine->has_context_changed) {
     compiled_engine->cudagraph.reset();
   }
+  // Reset the flag
+  compiled_engine->has_context_changed = false;
 
   // this is a buffer to store shape tensor input addresses throughout the runtime scope
   std::list<std::vector<int64_t>> inputShapeTensorValues;
diff --git a/py/torch_tensorrt/dynamo/runtime/_PythonTorchTensorRTModule.py b/py/torch_tensorrt/dynamo/runtime/_PythonTorchTensorRTModule.py
index e31d73f337..f55eb63e54 100644
--- a/py/torch_tensorrt/dynamo/runtime/_PythonTorchTensorRTModule.py
+++ b/py/torch_tensorrt/dynamo/runtime/_PythonTorchTensorRTModule.py
@@ -107,6 +107,7 @@ def __init__(
         self.engine = None
         self.weight_name_map = weight_name_map
         self.target_platform = Platform.current_platform()
+        self.has_context_changed = False
 
         if self.serialized_engine is not None and not self.settings.lazy_engine_init:
             self.setup_engine()
@@ -126,6 +127,9 @@ def set_device_memory_budget(self, budget_bytes: int) -> int:
             del self.context
         budget_bytes = self._set_device_memory_budget(budget_bytes)
         self.context = self.engine.create_execution_context()
+        # Indicates to reevaluate the runtime settings
+        self.has_context_changed = True
+
         return budget_bytes
 
     def _set_device_memory_budget(self, budget_bytes: int) -> int:
@@ -247,18 +251,21 @@ def forward(self, *inputs: torch.Tensor) -> torch.Tensor | Tuple[torch.Tensor, .
             self._check_initialized()
 
             cudagraphs_enabled = torch_tensorrt.runtime.get_cudagraphs_mode()
-            need_cudagraphs_record = (
-                cudagraphs_enabled and not self.cudagraphs_validate_shapes(inputs)
+            need_cudagraphs_record = cudagraphs_enabled and (
+                not self.cudagraphs_validate_shapes(inputs) or self.has_context_changed
             )
 
             if need_cudagraphs_record:
                 self._input_buffers = [None] * len(self.input_names)
                 self._output_buffers = [None] * len(self.output_names)
 
-            if not cudagraphs_enabled and self.cudagraph:
+            if self.cudagraph and (not cudagraphs_enabled or self.has_context_changed):
                 self.cudagraph.reset()
                 self.cudagraph = None
 
+            # Reset the flag
+            self.has_context_changed = False
+
             # If in safe mode, check at each iteration for for whether a switch is required
             if (
                 torch_tensorrt.runtime._multi_device_safe_mode._PY_RT_MULTI_DEVICE_SAFE_MODE