diff --git a/arm/Microsoft.Compute/availabilitySets/deploy.bicep b/arm/Microsoft.Compute/availabilitySets/deploy.bicep
index eb668cc85e..086dff0903 100644
--- a/arm/Microsoft.Compute/availabilitySets/deploy.bicep
+++ b/arm/Microsoft.Compute/availabilitySets/deploy.bicep
@@ -38,14 +38,16 @@ module pid_cuaId '.bicep/nested_cuaId.bicep' = if (!empty(cuaId)) {
   params: {}
 }
 
-resource availabilitySet 'Microsoft.Compute/availabilitySets@2021-04-01' = {
+resource availabilitySet 'Microsoft.Compute/availabilitySets@2021-07-01' = {
   name: name
   location: location
   tags: tags
   properties: {
     platformFaultDomainCount: availabilitySetFaultDomain
     platformUpdateDomainCount: availabilitySetUpdateDomain
-    proximityPlacementGroup: !empty(proximityPlacementGroupId) ? proximityPlacementGroupId : null
+    proximityPlacementGroup: !empty(proximityPlacementGroupId) ? {
+      id: proximityPlacementGroupId
+    } : null
   }
   sku: {
     name: availabilitySetSku
diff --git a/arm/Microsoft.Compute/availabilitySets/readme.md b/arm/Microsoft.Compute/availabilitySets/readme.md
index 2e8b9ad15f..f45a250756 100644
--- a/arm/Microsoft.Compute/availabilitySets/readme.md
+++ b/arm/Microsoft.Compute/availabilitySets/readme.md
@@ -8,7 +8,7 @@ This template deploys an availability set
 | :-- | :-- |
 | `Microsoft.Authorization/locks` | 2017-04-01 |
 | `Microsoft.Authorization/roleAssignments` | 2021-04-01-preview |
-| `Microsoft.Compute/availabilitySets` | 2021-04-01 |
+| `Microsoft.Compute/availabilitySets` | 2021-07-01 |
 
 ## Parameters
 
@@ -74,6 +74,6 @@ Tag names and tag values can be provided as needed. A tag can be left without a
 
 ## Template references
 
-- [Availabilitysets](https://docs.microsoft.com/en-us/azure/templates/Microsoft.Compute/2021-04-01/availabilitySets)
+- [Availabilitysets](https://docs.microsoft.com/en-us/azure/templates/Microsoft.Compute/2021-07-01/availabilitySets)
 - [Locks](https://docs.microsoft.com/en-us/azure/templates/Microsoft.Authorization/2017-04-01/locks)
 - [Roleassignments](https://docs.microsoft.com/en-us/azure/templates/Microsoft.Authorization/roleAssignments)