diff --git a/tools/test/toolchains/api_test.py b/tools/test/toolchains/api_test.py
index f48ea1dc0d0..ef42af86093 100644
--- a/tools/test/toolchains/api_test.py
+++ b/tools/test/toolchains/api_test.py
@@ -55,7 +55,7 @@ def test_arm_version_check(_run_cmd):
 def test_iar_version_check(_run_cmd):
     set_targets_json_location()
     _run_cmd.return_value = ("""
-    IAR ANSI C/C++ Compiler V7.80.1.28/LNX for ARM
+    IAR ANSI C/C++ Compiler V8.32.1/LNX for ARM
     """, "", 0)
     notifier = MockNotifier()
     toolchain = TOOLCHAIN_CLASSES["IAR"](TARGET_MAP["K64F"], notify=notifier)
diff --git a/tools/toolchains/iar.py b/tools/toolchains/iar.py
index dd3906a1627..7751795aadc 100644
--- a/tools/toolchains/iar.py
+++ b/tools/toolchains/iar.py
@@ -33,7 +33,7 @@ class IAR(mbedToolchain):
     DIAGNOSTIC_PATTERN = re.compile('"(?P<file>[^"]+)",(?P<line>[\d]+)\s+(?P<severity>Warning|Error|Fatal error)(?P<message>.+)')
     INDEX_PATTERN  = re.compile('(?P<col>\s*)\^')
     IAR_VERSION_RE = re.compile(b"IAR ANSI C/C\+\+ Compiler V(\d+\.\d+)")
-    IAR_VERSION = LooseVersion("7.80")
+    IAR_VERSION = LooseVersion("8.32")
 
     @staticmethod
     def check_executable():