diff --git a/.changeset/heavy-moose-appear.md b/.changeset/heavy-moose-appear.md
new file mode 100644
index 00000000..f4ae25e8
--- /dev/null
+++ b/.changeset/heavy-moose-appear.md
@@ -0,0 +1,28 @@
+---
+'@twilio-labs/serverless-runtime-types': major
+'twilio-run': major
+'create-twilio-function': minor
+'@twilio/runtime-handler': minor
+---
+
+feat: Upgrade Twilio SDK to v5.6.0 & peer dependency
+
+**IMPACT:**
+- `@twilio-labs/serverless-runtime-types`: Major (peer dependency)
+- `twilio-run`: Major (peer dependency)
+- `create-twilio-function`: Minor (default SDK version)
+- `@twilio/runtime-handler`: Minor (version upgrade)
+
+**WHAT:**
+- Twilio SDK upgraded to v5.6.0.
+- `@twilio-labs/serverless-runtime-types` & `twilio-run` now require `twilio` as a `peerDependency`.
+- Type definitions updated for Twilio v5.x compatibility.
+- Default dependencies in `create-twilio-function` updated.
+
+**WHY:**
+- Latest Twilio SDK features and fixes.
+- Prevents type conflicts by centralizing `twilio` dependency in user projects.
+
+**ACTION:**
+- **BREAKING:** Projects using `@twilio-labs/twilio-run` or `@twilio-labs/serverless-runtime-types` MUST add `twilio@^5.6.0` as a direct dependency (`npm install twilio@^5.6.0` or `yarn add twilio@^5.6.0`).
+- Clean install (`node_modules` deletion and lock file removal) is required after updating toolkit packages and adding `twilio`.
diff --git a/package.json b/package.json
index 3d599527..24e185ec 100644
--- a/package.json
+++ b/package.json
@@ -26,7 +26,7 @@
     "@changesets/cli": "^2.26.0",
     "@commitlint/cli": "^19.1.0",
     "@commitlint/config-conventional": "^19.1.0",
-    "@twilio/test-dep": "npm:twilio@4.22.0",
+    "@twilio/test-dep": "npm:twilio@5.6.0",
     "@types/jest": "^29.2.4",
     "all-contributors-cli": "^6.1.2",
     "commitizen": "^4.2.4",
@@ -45,6 +45,9 @@
     "typedoc": "^0.27.4",
     "typescript": "^5.3.3"
   },
+  "peerDependencies": {
+			"twilio": "^5.6.0"
+  },		
   "lint-staged": {
     "*.{js,jsx,ts,tsx}": [
       "prettier --write",
diff --git a/packages/create-twilio-function/package.json b/packages/create-twilio-function/package.json
index a3f8e8b7..4021a22f 100644
--- a/packages/create-twilio-function/package.json
+++ b/packages/create-twilio-function/package.json
@@ -24,7 +24,7 @@
   },
   "license": "MIT",
   "devDependencies": {
-    "@twilio/runtime-handler": "^2.0.3",
+    "@twilio/runtime-handler": "^2.1.0",
     "nock": "^11.3.4"
   },
   "dependencies": {
diff --git a/packages/create-twilio-function/src/create-twilio-function/versions.js b/packages/create-twilio-function/src/create-twilio-function/versions.js
index cb65f86d..3e135fdd 100644
--- a/packages/create-twilio-function/src/create-twilio-function/versions.js
+++ b/packages/create-twilio-function/src/create-twilio-function/versions.js
@@ -1,13 +1,13 @@
 const pkgJson = require('../../package.json');
 
 module.exports = {
-  twilio: '5.0.3',
+  twilio: '5.6.0',
   twilioRuntimeHandler: pkgJson.devDependencies[
     '@twilio/runtime-handler'
   ].replace(/[\^~]/, ''),
   twilioRun: pkgJson.dependencies['twilio-run'],
   node: '22',
-  typescript: '^5.3.3',
-  serverlessRuntimeTypes: '^4.0.0',
+  typescript: '^5.8.0',
+  serverlessRuntimeTypes: '^4.0.1',
   copyfiles: '^2.4.1',
 };
diff --git a/packages/runtime-handler/README.md b/packages/runtime-handler/README.md
index bd40d152..44586c89 100644
--- a/packages/runtime-handler/README.md
+++ b/packages/runtime-handler/README.md
@@ -7,7 +7,7 @@ Define the version of the `@twilio/runtime-handler` inside your `dependencies` s
 ```json
 {
   "dependencies": {
-    "@twilio/runtime-handler": "1.1.0"
+    "@twilio/runtime-handler": "2.1.0"
   }
 }
 ```
diff --git a/packages/runtime-handler/package.json b/packages/runtime-handler/package.json
index ba9a62d0..eb4424ab 100644
--- a/packages/runtime-handler/package.json
+++ b/packages/runtime-handler/package.json
@@ -39,7 +39,7 @@
     "clean": "rimraf ./dist"
   },
   "devDependencies": {
-    "@twilio/test-dep": "npm:twilio@4.22.0",
+    "@twilio/test-dep": "npm:twilio@5.6.0",
     "@types/common-tags": "^1.8.0",
     "@types/cookie-parser": "^1.4.2",
     "@types/debug": "^4.1.4",
@@ -70,7 +70,7 @@
     "nocache": "^2.1.0",
     "normalize.css": "^8.0.1",
     "serialize-error": "^7.0.1",
-    "twilio": "4.23.0"
+    "twilio": "5.6.0"
   },
   "gitHead": "6db273648ed19474f4125042556b10c051529912"
 }
diff --git a/packages/serverless-runtime-types/README.md b/packages/serverless-runtime-types/README.md
index 716c4209..550d64c2 100644
--- a/packages/serverless-runtime-types/README.md
+++ b/packages/serverless-runtime-types/README.md
@@ -22,6 +22,17 @@
 npm install @twilio-labs/serverless-runtime-types
 ```
 
+**Peer Dependency Requirement:**
+
+This package requires the core `twilio` Node.js library as a **peer dependency** (version `^5.6.0` or compatible). This is necessary to ensure type consistency and prevent version conflicts within your project.
+
+**You MUST explicitly install both `@twilio-labs/serverless-runtime-types` and a compatible version of `twilio` in your project.**
+
+```bash
+# Using npm
+npm install @twilio-labs/serverless-runtime-types twilio@^5.6.0 --save-dev
+```
+
 ## Example
 
 ### In JavaScript
diff --git a/packages/serverless-runtime-types/package.json b/packages/serverless-runtime-types/package.json
index 03691c36..263853de 100644
--- a/packages/serverless-runtime-types/package.json
+++ b/packages/serverless-runtime-types/package.json
@@ -29,12 +29,14 @@
   },
   "dependencies": {
     "@types/express": "^4.17.21",
-    "@types/qs": "^6.9.4",
-    "twilio": "^4.23.0"
+    "@types/qs": "^6.9.4"
   },
+  "peerDependencies": {
+		"twilio": "^5.6.0"
+  },		
   "devDependencies": {
     "all-contributors-cli": "^6.7.0",
-    "typescript": "^5.3.3"
+    "typescript": "^5.8.0"
   },
   "publishConfig": {
     "access": "public"
diff --git a/packages/serverless-runtime-types/types.d.ts b/packages/serverless-runtime-types/types.d.ts
index 0d682b92..ae3acd37 100644
--- a/packages/serverless-runtime-types/types.d.ts
+++ b/packages/serverless-runtime-types/types.d.ts
@@ -2,7 +2,7 @@ import * as twilio from 'twilio';
 import { ServiceContext } from 'twilio/lib/rest/sync/v1/service';
 import { SyncListListInstance } from 'twilio/lib/rest/sync/v1/service/syncList';
 import { SyncMapListInstance } from 'twilio/lib/rest/sync/v1/service/syncMap';
-import { TwilioClientOptions } from 'twilio/lib/rest/Twilio';
+import { ClientOpts } from 'twilio';
 
 export type EnvironmentVariables = {
   [key: string]: string | undefined;
@@ -187,7 +187,7 @@ export interface TwilioResponse {
   removeCookie(key: string): TwilioResponse;
 }
 
-export type RuntimeSyncClientOptions = TwilioClientOptions & {
+export type RuntimeSyncClientOptions = ClientOpts & {
   serviceName?: string;
 };
 
@@ -360,7 +360,7 @@ export type Context<T = {}> = {
    * };
    * ```
    */
-  getTwilioClient(options?: TwilioClientOptions): twilio.Twilio;
+  getTwilioClient(options?: ClientOpts): twilio.Twilio;
   /**
    * The domain name for the Service that contains this Function.
    */
@@ -412,6 +412,7 @@ export type GlobalTwilio = Omit<typeof twilio, 'default'> & {
 export { ServiceContext } from 'twilio/lib/rest/sync/v1/service';
 export { SyncListListInstance } from 'twilio/lib/rest/sync/v1/service/syncList';
 export { SyncMapListInstance } from 'twilio/lib/rest/sync/v1/service/syncMap';
-export { TwilioClientOptions } from 'twilio/lib/rest/Twilio';
+export { ClientOpts as TwilioClientOptions } from 'twilio/lib/rest/Twilio';
+
 export type TwilioClient = twilio.Twilio;
 export type TwilioPackage = typeof twilio;
diff --git a/packages/twilio-run/package.json b/packages/twilio-run/package.json
index 1ea3d6ef..5ddf4cdb 100644
--- a/packages/twilio-run/package.json
+++ b/packages/twilio-run/package.json
@@ -76,12 +76,14 @@
     "serialize-error": "^7.0.1",
     "terminal-link": "^1.3.0",
     "title": "^3.4.1",
-    "twilio": "^4.23.0",
     "type-fest": "^0.15.1",
     "window-size": "^1.1.1",
     "wrap-ansi": "^7.0.0",
     "yargs": "^17.2.1"
   },
+  "peerDependencies": {
+	  "twilio": "^5.6.0"
+	},		
   "optionalDependencies": {
     "ngrok": "^3.3.0"
   },
@@ -113,7 +115,7 @@
     "nock": "^12.0.2",
     "supertest": "^3.1.0",
     "typescript": "^4.9.4",
-    "@twilio/test-dep": "npm:twilio@4.22.0"
+    "@twilio/test-dep": "npm:twilio@5.6.0"
   },
   "files": [
     "bin/",
diff --git a/packages/twilio-run/src/runtime/internal/runtime.ts b/packages/twilio-run/src/runtime/internal/runtime.ts
index 62a02ea4..87e57591 100644
--- a/packages/twilio-run/src/runtime/internal/runtime.ts
+++ b/packages/twilio-run/src/runtime/internal/runtime.ts
@@ -16,7 +16,7 @@ import { getDebugFunction } from '../../utils/logger';
 
 const debug = getDebugFunction('twilio-run:runtime');
 
-const { getCachedResources } = require('./route-cache');
+import { getCachedResources } from './route-cache';
 
 function getAssets(): AssetResourceMap {
   const { assets } = getCachedResources();
@@ -72,9 +72,9 @@ export function create({ env }: StartCliConfig): RuntimeInstance {
         .join(',')})`,
     });
     const client = twilio(env.ACCOUNT_SID, env.AUTH_TOKEN, options);
-    const service = (client.sync.v1.services(
+    const service = client.sync.v1.services(
       serviceName || 'default'
-    ) as unknown) as RuntimeSyncServiceContext;
+    ) as unknown as RuntimeSyncServiceContext;
 
     service.maps = service.syncMaps;
     service.lists = service.syncLists;
diff --git a/packages/twilio-run/src/runtime/route.ts b/packages/twilio-run/src/runtime/route.ts
index 342fa55a..4480c09f 100644
--- a/packages/twilio-run/src/runtime/route.ts
+++ b/packages/twilio-run/src/runtime/route.ts
@@ -4,6 +4,7 @@ import {
   ServerlessEventObject,
   ServerlessFunctionSignature,
 } from '@twilio-labs/serverless-runtime-types/types';
+
 import { fork } from 'child_process';
 import {
   NextFunction,
@@ -23,7 +24,6 @@ import { cleanUpStackTrace } from '../utils/stack-trace/clean-up';
 import { Reply } from './internal/functionRunner';
 import { Response } from './internal/response';
 import * as Runtime from './internal/runtime';
-import * as PATH from 'path';
 
 const RUNNER_PATH =
   process.env.NODE_ENV === 'test'
@@ -40,7 +40,7 @@ export function constructEvent<T extends ServerlessEventObject>(
   return { ...req.query, ...req.body };
 }
 
-export function constructContext<T extends {} = {}>(
+export function constructContext(
   { url, env }: StartCliConfig,
   functionPath: string
 ): Context<{