diff --git a/CHANGELOG.md b/CHANGELOG.md
index 0b503bf..20af2e0 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -1,5 +1,12 @@
 # Changelog
 
+## 1.2.1 (2025-09-10)
+
+- fix: Add proactive DNS resolution check in AWS config check to timely detect configuration drift
+- fix: Add a missing telemetry field in `setup_ended` event
+- chore: Substitute periodic checks with file watchers for LocalStack setup status.
+
+
 ## 1.2.0 (2025-09-09)
 
 - feat: Always show `Start` and `Stop` commands if LocalStack CLI is available
diff --git a/package-lock.json b/package-lock.json
index 1e520bc..c1ecb81 100644
--- a/package-lock.json
+++ b/package-lock.json
@@ -1,12 +1,12 @@
 {
 	"name": "localstack",
-	"version": "1.2.0",
+	"version": "1.2.1",
 	"lockfileVersion": 3,
 	"requires": true,
 	"packages": {
 		"": {
 			"name": "localstack",
-			"version": "1.2.0",
+			"version": "1.2.1",
 			"license": "Apache-2.0",
 			"devDependencies": {
 				"@biomejs/biome": "^2.2.3",
diff --git a/package.json b/package.json
index 36cd037..8bb675e 100644
--- a/package.json
+++ b/package.json
@@ -3,7 +3,7 @@
 	"publisher": "LocalStack",
 	"displayName": "LocalStack Toolkit",
 	"description": "LocalStack - Run locally, deploy globally!",
-	"version": "1.2.0",
+	"version": "1.2.1",
 	"engines": {
 		"node": ">=20",
 		"vscode": "^1.83.0"