diff --git a/drivers/i3c/i3c_common.c b/drivers/i3c/i3c_common.c
index 72e82a787a9beb..d36a5ca6ddc177 100644
--- a/drivers/i3c/i3c_common.c
+++ b/drivers/i3c/i3c_common.c
@@ -591,11 +591,12 @@ int i3c_device_basic_info_get(struct i3c_device_desc *target)
  */
 static int i3c_bus_setdasa(const struct device *dev,
 			   const struct i3c_dev_list *dev_list,
-			   bool *need_daa)
+			   bool *need_daa, bool *need_aasa)
 {
 	int i, ret;
 
 	*need_daa = false;
+	*need_aasa = false;
 
 	/* Loop through the registered I3C devices */
 	for (i = 0; i < dev_list->num_i3c; i++) {
@@ -610,6 +611,17 @@ static int i3c_bus_setdasa(const struct device *dev,
 			continue;
 		}
 
+		/*
+		 * A device that supports SETAASA and will use the same dynamic
+		 * address as its static address if a different dynamic address
+		 * is not requested
+		 */
+		if ((desc->supports_setaasa) && ((desc->init_dynamic_addr == 0) ||
+					       desc->init_dynamic_addr == desc->static_addr)) {
+			*need_aasa = true;
+			continue;
+		}
+
 		LOG_DBG("SETDASA for 0x%x", desc->static_addr);
 
 		ret = i3c_ccc_do_setdasa(desc);
@@ -639,6 +651,7 @@ int i3c_bus_init(const struct device *dev, const struct i3c_dev_list *dev_list)
 {
 	int i, ret = 0;
 	bool need_daa = true;
+	bool need_aasa = true;
 	struct i3c_ccc_events i3c_events;
 
 #ifdef CONFIG_I3C_INIT_RSTACT
@@ -684,11 +697,32 @@ int i3c_bus_init(const struct device *dev, const struct i3c_dev_list *dev_list)
 	/*
 	 * Set static addresses as dynamic addresses.
 	 */
-	ret = i3c_bus_setdasa(dev, dev_list, &need_daa);
+	ret = i3c_bus_setdasa(dev, dev_list, &need_daa, &need_aasa);
 	if (ret != 0) {
 		goto err_out;
 	}
 
+	/*
+	 * Perform Set All Addresses to Static Address if possible.
+	 */
+	if (need_aasa) {
+		ret = i3c_ccc_do_setaasa_all(dev);
+		if (ret != 0) {
+			for (i = 0; i < dev_list->num_i3c; i++) {
+				struct i3c_device_desc *desc = &dev_list->i3c[i];
+				/*
+				 * Only set for devices that support SETAASA and do not
+				 * request a different dynamic address than its SA
+				 */
+				if ((desc->supports_setaasa) && (desc->static_addr != 0) &&
+				    ((desc->init_dynamic_addr == 0) ||
+				     desc->init_dynamic_addr == desc->static_addr)) {
+					desc->dynamic_addr = desc->static_addr;
+				}
+			}
+		}
+	}
+
 	/*
 	 * Perform Dynamic Address Assignment if needed.
 	 */
diff --git a/drivers/i3c/i3c_shell.c b/drivers/i3c/i3c_shell.c
index dd9955520ed35e..454d5bde145b55 100644
--- a/drivers/i3c/i3c_shell.c
+++ b/drivers/i3c/i3c_shell.c
@@ -550,7 +550,8 @@ static int cmd_i3c_ccc_setaasa(const struct shell *shell_ctx, size_t argc, char
 		SYS_SLIST_FOR_EACH_NODE(&data->attached_dev.devices.i3c, node) {
 			struct i3c_device_desc *desc =
 				CONTAINER_OF(node, struct i3c_device_desc, node);
-			if ((desc->dynamic_addr == 0) && (desc->static_addr != 0)) {
+			if ((desc->supports_setaasa) && (desc->dynamic_addr == 0) &&
+			    (desc->static_addr != 0)) {
 				desc->dynamic_addr = desc->static_addr;
 			}
 		}
diff --git a/dts/bindings/i3c/i3c-device.yaml b/dts/bindings/i3c/i3c-device.yaml
index 48a0bd01e71f25..297e28e632577d 100644
--- a/dts/bindings/i3c/i3c-device.yaml
+++ b/dts/bindings/i3c/i3c-device.yaml
@@ -61,3 +61,9 @@ properties:
     type: int
     description: |
       Dynamic address to be assigned to the device.
+
+  supports-setaasa:
+    type: boolean
+    description: |
+      Indicates if the device supports the CCC SETAASA. If true, it will
+      be used as an optimization for bus initialization.
diff --git a/include/zephyr/drivers/i3c.h b/include/zephyr/drivers/i3c.h
index 4eed486092cf21..9c0a5e241d1397 100644
--- a/include/zephyr/drivers/i3c.h
+++ b/include/zephyr/drivers/i3c.h
@@ -949,6 +949,14 @@ struct i3c_device_desc {
 	 */
 	const uint8_t init_dynamic_addr;
 
+	/**
+	 * Device support for SETAASA
+	 *
+	 * This will be used as an optimization for bus initializtion if the
+	 * device supports SETAASA.
+	 */
+	const bool supports_setaasa;
+
 	/**
 	 * Dynamic Address for this target device used for communication.
 	 *
diff --git a/include/zephyr/drivers/i3c/devicetree.h b/include/zephyr/drivers/i3c/devicetree.h
index 4834b5bbd85ecd..803f17d55179b5 100644
--- a/include/zephyr/drivers/i3c/devicetree.h
+++ b/include/zephyr/drivers/i3c/devicetree.h
@@ -71,6 +71,7 @@ extern "C" {
 		       | DT_PROP_BY_IDX(node_id, reg, 2),		\
 		.init_dynamic_addr =					\
 			DT_PROP_OR(node_id, assigned_address, 0),	\
+		.supports_setaasa = DT_PROP(node_id, supports_setaasa), \
 	},
 
 /**