diff --git a/cmd/utils/flags.go b/cmd/utils/flags.go
index 0b1695d0a5..c51d7916ca 100644
--- a/cmd/utils/flags.go
+++ b/cmd/utils/flags.go
@@ -1491,10 +1491,9 @@ func SetEthConfig(ctx *cli.Context, stack *node.Node, cfg *eth.Config) {
 	CheckExclusive(ctx, LegacyLightServFlag, LightServeFlag, SyncModeFlag, "light")
 	CheckExclusive(ctx, DeveloperFlag, ExternalSignerFlag) // Can't use both ephemeral unlocked and external signer
 	CheckExclusive(ctx, GCModeFlag, "archive", TxLookupLimitFlag)
-	// todo(rjl493456442) make it available for les server
-	// Ancient tx indices pruning is not available for les server now
-	// since light client relies on the server for transaction status query.
-	CheckExclusive(ctx, LegacyLightServFlag, LightServeFlag, TxLookupLimitFlag)
+	if (ctx.GlobalIsSet(LegacyLightServFlag.Name) || ctx.GlobalIsSet(LightServeFlag.Name)) && ctx.GlobalIsSet(TxLookupLimitFlag.Name) {
+		log.Warn("LES server cannot serve old transaction status and cannot connect below les/4 protocol version if transaction lookup index is limited")
+	}
 	var ks *keystore.KeyStore
 	if keystores := stack.AccountManager().Backends(keystore.KeyStoreType); len(keystores) > 0 {
 		ks = keystores[0].(*keystore.KeyStore)
diff --git a/les/odr_requests.go b/les/odr_requests.go
index eb1d3602e0..a8cf8f50a9 100644
--- a/les/odr_requests.go
+++ b/les/odr_requests.go
@@ -488,7 +488,7 @@ func (r *TxStatusRequest) GetCost(peer *serverPeer) uint64 {
 
 // CanSend tells if a certain peer is suitable for serving the given request
 func (r *TxStatusRequest) CanSend(peer *serverPeer) bool {
-	return peer.version >= lpv2
+	return peer.serveTxLookup
 }
 
 // Request sends an ODR request to the LES network (implementation of LesOdrRequest)
diff --git a/les/peer.go b/les/peer.go
index 6004af03f5..0e2ed52c12 100644
--- a/les/peer.go
+++ b/les/peer.go
@@ -341,6 +341,7 @@ type serverPeer struct {
 	onlyAnnounce            bool   // The flag whether the server sends announcement only.
 	chainSince, chainRecent uint64 // The range of chain server peer can serve.
 	stateSince, stateRecent uint64 // The range of state server peer can serve.
+	serveTxLookup           bool   // The server peer can serve tx lookups.
 
 	// Advertised checkpoint fields
 	checkpointNumber uint64                   // The block height which the checkpoint is registered.
@@ -628,6 +629,18 @@ func (p *serverPeer) Handshake(genesis common.Hash, forkid forkid.ID, forkFilter
 		if recv.get("txRelay", nil) != nil {
 			p.onlyAnnounce = true
 		}
+		if p.version >= lpv4 {
+			var recentTx uint
+			if err := recv.get("recentTxLookup", &recentTx); err != nil {
+				return err
+			}
+			// Note: in the current version we only consider the tx index service useful
+			// if it is unlimited. This can be made configurable in the future.
+			p.serveTxLookup = recentTx == txIndexUnlimited
+		} else {
+			p.serveTxLookup = true
+		}
+
 		if p.onlyAnnounce && !p.trusted {
 			return errResp(ErrUselessPeer, "peer cannot serve requests")
 		}
@@ -969,6 +982,20 @@ func (p *clientPeer) freezeClient() {
 // Handshake executes the les protocol handshake, negotiating version number,
 // network IDs, difficulties, head and genesis blocks.
 func (p *clientPeer) Handshake(td *big.Int, head common.Hash, headNum uint64, genesis common.Hash, forkID forkid.ID, forkFilter forkid.Filter, server *LesServer) error {
+	recentTx := server.handler.blockchain.TxLookupLimit()
+	if recentTx != txIndexUnlimited {
+		if recentTx < blockSafetyMargin {
+			recentTx = txIndexDisabled
+		} else {
+			recentTx -= blockSafetyMargin - txIndexRecentOffset
+		}
+	}
+	if server.config.UltraLightOnlyAnnounce {
+		recentTx = txIndexDisabled
+	}
+	if recentTx != txIndexUnlimited && p.version < lpv4 {
+		return errors.New("Cannot serve old clients without a complete tx index")
+	}
 	// Note: clientPeer.headInfo should contain the last head announced to the client by us.
 	// The values announced in the handshake are dummy values for compatibility reasons and should be ignored.
 	p.headInfo = blockInfo{Hash: head, Number: headNum, Td: td}
@@ -981,13 +1008,16 @@ func (p *clientPeer) Handshake(td *big.Int, head common.Hash, headNum uint64, ge
 
 			// If local ethereum node is running in archive mode, advertise ourselves we have
 			// all version state data. Otherwise only recent state is available.
-			stateRecent := uint64(core.TriesInMemory - 4)
+			stateRecent := uint64(core.TriesInMemory - blockSafetyMargin)
 			if server.archiveMode {
 				stateRecent = 0
 			}
 			*lists = (*lists).add("serveRecentState", stateRecent)
 			*lists = (*lists).add("txRelay", nil)
 		}
+		if p.version >= lpv4 {
+			*lists = (*lists).add("recentTxLookup", recentTx)
+		}
 		*lists = (*lists).add("flowControl/BL", server.defParams.BufLimit)
 		*lists = (*lists).add("flowControl/MRR", server.defParams.MinRecharge)
 
diff --git a/les/protocol.go b/les/protocol.go
index aebe0f2c04..39d9f5152f 100644
--- a/les/protocol.go
+++ b/les/protocol.go
@@ -50,6 +50,11 @@ var ProtocolLengths = map[uint]uint64{lpv2: 22, lpv3: 24, lpv4: 24}
 const (
 	NetworkId          = 1
 	ProtocolMaxMsgSize = 10 * 1024 * 1024 // Maximum cap on the size of a protocol message
+	blockSafetyMargin  = 4                // safety margin applied to block ranges specified relative to head block
+
+	txIndexUnlimited    = 0 // this value in the "recentTxLookup" handshake field means the entire tx index history is served
+	txIndexDisabled     = 1 // this value means tx index is not served at all
+	txIndexRecentOffset = 1 // txIndexRecentOffset + N in the handshake field means then tx index of the last N blocks is supported
 )
 
 // les protocol message codes