diff --git a/doc/source/admin/advanced-configuration-guide.rst b/doc/source/admin/advanced-configuration-guide.rst
index 1ddc8aab72..18b4168dcd 100644
--- a/doc/source/admin/advanced-configuration-guide.rst
+++ b/doc/source/admin/advanced-configuration-guide.rst
@@ -519,7 +519,7 @@ set to ``true`` and some extra configurations are needed:
   be returned by the Compute service.
   This can be done by:
 
-  * by changing nova's ``policy.json`` to allow the user access to the
+  * by changing nova's ``policy.yaml`` to allow the user access to the
     ``extended_server_attributes`` option.
   * by designating an account with privileged rights in the cinder
     configuration:
diff --git a/doc/source/admin/configuration-guide.rst b/doc/source/admin/configuration-guide.rst
index 24b5a4ba36..a0400f58c3 100644
--- a/doc/source/admin/configuration-guide.rst
+++ b/doc/source/admin/configuration-guide.rst
@@ -161,11 +161,19 @@ for instance provisioning.
 Policy configuration
 --------------------
 
+.. warning::
+
+   JSON formatted policy file is deprecated since Sahara 15.0.0 (Xena).
+   This `oslopolicy-convert-json-to-yaml`__ tool will migrate your existing
+   JSON-formatted policy file to YAML in a backward-compatible way.
+
+.. __: https://docs.openstack.org/oslo.policy/victoria/cli/oslopolicy-convert-json-to-yaml.html
+
 Sahara's public API calls may be restricted to certain sets of users by
 using a policy configuration file. The location of the policy file(s)
 is controlled by the ``policy_file`` and ``policy_dirs`` parameters
 in the ``[oslo_policy]`` section. By default sahara will search for
-a ``policy.json`` file in the same directory as the ``sahara.conf``
+a ``policy.yaml`` file in the same directory as the ``sahara.conf``
 configuration file.
 
 Examples
diff --git a/lower-constraints.txt b/lower-constraints.txt
index 23d6ecf2dd..a811c86e74 100644
--- a/lower-constraints.txt
+++ b/lower-constraints.txt
@@ -67,21 +67,21 @@ os-service-types==1.2.0
 osc-lib==1.10.0
 oslo.cache==1.29.0
 oslo.concurrency==3.26.0
-oslo.config==5.2.0
-oslo.context==2.19.2
+oslo.config==6.8.0
+oslo.context==2.22.0
 oslo.db==6.0.0
 oslo.i18n==3.15.3
 oslo.log==3.36.0
 oslo.messaging==10.2.0
 oslo.middleware==3.31.0
-oslo.policy==1.30.0
+oslo.policy==3.6.0
 oslo.rootwrap==5.8.0
 oslo.serialization==2.18.0
 oslo.service==1.31.0
-oslo.upgradecheck==0.1.0
-oslo.utils==3.33.0
+oslo.upgradecheck==1.3.0
+oslo.utils==4.5.0
 oslotest==3.2.0
-packaging==17.1
+packaging==20.4
 paramiko==2.7.1
 Paste==2.0.3
 PasteDeploy==1.5.2
@@ -117,13 +117,13 @@ python-saharaclient==1.4.0
 python-subunit==1.4.0
 python-swiftclient==3.2.0
 pytz==2018.3
-PyYAML==3.13
+PyYAML==5.1
 reno==2.5.0
 repoze.lru==0.7
-requests==2.14.2
+requests==2.23.0
 requestsexceptions==1.4.0
 restructuredtext-lint==1.1.3
-rfc3986==1.1.0
+rfc3986==1.2.0
 Routes==2.4.1
 simplejson==3.13.2
 six==1.14.0
diff --git a/releasenotes/notes/deprecate-json-formatted-policy-file-b267f288cba7e325.yaml b/releasenotes/notes/deprecate-json-formatted-policy-file-b267f288cba7e325.yaml
new file mode 100644
index 0000000000..00519ae7be
--- /dev/null
+++ b/releasenotes/notes/deprecate-json-formatted-policy-file-b267f288cba7e325.yaml
@@ -0,0 +1,20 @@
+---
+upgrade:
+  - |
+    The default value of ``[oslo_policy] policy_file`` config option has
+    been changed from ``policy.json`` to ``policy.yaml``.
+    Operators who are utilizing customized or previously generated
+    static policy JSON files (which are not needed by default), should
+    generate new policy files or convert them in YAML format. Use the
+    `oslopolicy-convert-json-to-yaml
+    <https://docs.openstack.org/oslo.policy/latest/cli/oslopolicy-convert-json-to-yaml.html>`_
+    tool to convert a JSON to YAML formatted policy file in
+    backward compatible way.
+deprecations:
+  - |
+    Use of JSON policy files was deprecated by the ``oslo.policy`` library
+    during the Victoria development cycle. As a result, this deprecation is
+    being noted in the Xena cycle with an anticipated future removal of support
+    by ``oslo.policy``. As such operators will need to convert to YAML policy
+    files. Please see the upgrade notes for details on migration of any
+    custom policy files.
diff --git a/requirements.txt b/requirements.txt
index 8f10d3a040..769b84d0b6 100644
--- a/requirements.txt
+++ b/requirements.txt
@@ -15,22 +15,22 @@ jsonschema>=3.2.0 # MIT
 keystoneauth1>=3.4.0 # Apache-2.0
 keystonemiddleware>=4.17.0 # Apache-2.0
 microversion-parse>=0.2.1 # Apache-2.0
-oslo.config>=5.2.0 # Apache-2.0
+oslo.config>=6.8.0 # Apache-2.0
 oslo.concurrency>=3.26.0 # Apache-2.0
-oslo.context>=2.19.2 # Apache-2.0
+oslo.context>=2.22.0 # Apache-2.0
 oslo.db>=6.0.0 # Apache-2.0
 oslo.i18n>=3.15.3 # Apache-2.0
 oslo.log>=3.36.0 # Apache-2.0
 oslo.messaging>=10.2.0 # Apache-2.0
 oslo.middleware>=3.31.0 # Apache-2.0
-oslo.policy>=1.30.0 # Apache-2.0
+oslo.policy>=3.6.0 # Apache-2.0
 oslo.rootwrap>=5.8.0 # Apache-2.0
 oslo.serialization!=2.19.1,>=2.18.0 # Apache-2.0
 oslo.service>=1.31.0 # Apache-2.0
-oslo.upgradecheck>=0.1.0 # Apache-2.0
-oslo.utils>=3.33.0 # Apache-2.0
+oslo.upgradecheck>=1.3.0 # Apache-2.0
+oslo.utils>=4.5.0 # Apache-2.0
 paramiko>=2.7.1 # LGPLv2.1+
-requests>=2.14.2 # Apache-2.0
+requests>=2.23.0 # Apache-2.0
 python-cinderclient!=4.0.0,>=3.3.0 # Apache-2.0
 python-keystoneclient>=3.8.0 # Apache-2.0
 python-manilaclient>=1.16.0 # Apache-2.0
diff --git a/sahara/api/acl.py b/sahara/api/acl.py
index f9a8cff97a..0dcdce041b 100644
--- a/sahara/api/acl.py
+++ b/sahara/api/acl.py
@@ -18,6 +18,7 @@
 import functools
 
 from oslo_config import cfg
+from oslo_policy import opts
 from oslo_policy import policy
 
 from sahara.common import policies
@@ -26,6 +27,12 @@ from sahara import exceptions
 
 ENFORCER = None
 
+# TODO(gmann): Remove setting the default value of config policy_file
+# once oslo_policy change the default value to 'policy.yaml'.
+# https://opendev.org/openstack/oslo.policy/src/commit/d8534850d9238e85ae0ea55bf2ac8583681fdb2b/oslo_policy/opts.py#L49
+DEFAULT_POLICY_FILE = 'policy.yaml'
+opts.set_defaults(cfg.CONF, DEFAULT_POLICY_FILE)
+
 
 def setup_policy():
     global ENFORCER
diff --git a/sahara/cli/sahara_status.py b/sahara/cli/sahara_status.py
index ea9cdc3710..d6ebcf7124 100644
--- a/sahara/cli/sahara_status.py
+++ b/sahara/cli/sahara_status.py
@@ -15,6 +15,7 @@
 import sys
 
 from oslo_config import cfg
+from oslo_upgradecheck import common_checks
 from oslo_upgradecheck import upgradecheck
 
 from sahara.i18n import _
@@ -30,17 +31,9 @@ class Checks(upgradecheck.UpgradeCommands):
     and added to _upgrade_checks tuple.
     """
 
-    def _sample_check(self):
-        """This is sample check added to test the upgrade check framework
-
-        It needs to be removed after adding any real upgrade check
-        """
-        return upgradecheck.Result(upgradecheck.Code.SUCCESS, 'Sample detail')
-
     _upgrade_checks = (
-        # Sample check added for now.
-        # Whereas in future real checks must be added here in tuple
-        (_('Sample Check'), _sample_check),
+        (_("Policy File JSON to YAML Migration"),
+         (common_checks.check_policy_json, {'conf': CONF})),
     )
 
 
diff --git a/sahara/common/config.py b/sahara/common/config.py
index 4ab0e3fbc6..0cbd1ad449 100644
--- a/sahara/common/config.py
+++ b/sahara/common/config.py
@@ -14,12 +14,20 @@
 # limitations under the License.
 
 from oslo_middleware import cors
+from oslo_policy import opts
+
+from sahara import config
 
 
 def set_config_defaults():
     """This method updates all configuration default values."""
     set_cors_middleware_defaults()
 
+    # TODO(gmann): Remove setting the default value of config policy_file
+    # once oslo_policy change the default value to 'policy.yaml'.
+    # https://opendev.org/openstack/oslo.policy/src/commit/d8534850d9238e85ae0ea55bf2ac8583681fdb2b/oslo_policy/opts.py#L49
+    opts.set_defaults(config.CONF, 'policy.yaml')
+
 
 def set_cors_middleware_defaults():
     """Update default configuration options for oslo.middleware."""
diff --git a/sahara/tests/unit/api/test_acl.py b/sahara/tests/unit/api/test_acl.py
index a7d799c76b..875fe9cd90 100644
--- a/sahara/tests/unit/api/test_acl.py
+++ b/sahara/tests/unit/api/test_acl.py
@@ -13,6 +13,8 @@
 # See the License for the specific language governing permissions and
 # limitations under the License.
 
+from unittest import mock
+
 from oslo_policy import policy as cpolicy
 
 from sahara.api import acl
@@ -27,7 +29,9 @@ class TestAcl(base.SaharaTestCase):
         rules = cpolicy.Rules.load_json(json)
         acl.ENFORCER.set_rules(rules, use_conf=False)
 
-    def test_policy_allow(self):
+    @mock.patch('oslo_config.cfg.ConfigOpts.find_file')
+    def test_policy_allow(self, mock_config):
+        mock_config.return_value = '/etc/sahara/'
         @acl.enforce("data-processing:clusters:get_all")
         def test():
             pass
@@ -37,7 +41,9 @@ class TestAcl(base.SaharaTestCase):
 
         test()
 
-    def test_policy_deny(self):
+    @mock.patch('oslo_config.cfg.ConfigOpts.find_file')
+    def test_policy_deny(self, mock_config):
+        mock_config.return_value = '/etc/sahara/'
         @acl.enforce("data-processing:clusters:get_all")
         def test():
             pass
diff --git a/sahara/tests/unit/cli/test_sahara_cli.py b/sahara/tests/unit/cli/test_sahara_cli.py
index 4add2ed318..b7f7a48862 100644
--- a/sahara/tests/unit/cli/test_sahara_cli.py
+++ b/sahara/tests/unit/cli/test_sahara_cli.py
@@ -52,9 +52,10 @@ class TestSaharaCLI(base.SaharaTestCase):
         for patcher in reversed(self.patchers):
             patcher.stop()
 
+    @mock.patch('oslo_config.cfg.ConfigOpts.find_file')
     @mock.patch('sahara.main.setup_sahara_api')
-    def test_main_start_api(self, mock_setup_sahara_api):
-
+    def test_main_start_api(self, mock_setup_sahara_api, mock_config):
+        mock_config.return_value = '/etc/sahara/'
         sahara_api.main()
 
         self.mock_start_server.assert_called_once_with()
@@ -76,8 +77,9 @@ class TestSaharaCLI(base.SaharaTestCase):
         mock_pl.launch_service.assert_called_once_with(mock_get_service)
         mock_pl.wait.assert_called_once_with()
 
-    def test_main_start_all(self):
-
+    @mock.patch('oslo_config.cfg.ConfigOpts.find_file')
+    def test_main_start_all(self, mock_config):
+        mock_config.return_value = '/etc/sahara/'
         sahara_all.main()
 
         self.mock_start_server.assert_called_once_with()
diff --git a/sahara/tests/unit/cli/test_sahara_status.py b/sahara/tests/unit/cli/test_sahara_status.py
index 3ac3c179e1..d7f87e4b56 100644
--- a/sahara/tests/unit/cli/test_sahara_status.py
+++ b/sahara/tests/unit/cli/test_sahara_status.py
@@ -12,6 +12,8 @@
 #    License for the specific language governing permissions and limitations
 #    under the License.
 
+from unittest import mock
+
 from oslo_upgradecheck.upgradecheck import Code
 
 from sahara.cli import sahara_status
@@ -24,7 +26,15 @@ class TestUpgradeChecks(base.SaharaTestCase):
         super(TestUpgradeChecks, self).setUp()
         self.cmd = sahara_status.Checks()
 
-    def test__sample_check(self):
-        check_result = self.cmd._sample_check()
-        self.assertEqual(
-            Code.SUCCESS, check_result.code)
+    @mock.patch('oslo_config.cfg.ConfigOpts.find_file')
+    @mock.patch('oslo_utils.fileutils.is_json')
+    def test_checks(self, mock_util, mock_config):
+        mock_config.return_value = '/etc/sahara/'
+        mock_util.return_value = False
+        for name, func in self.cmd._upgrade_checks:
+            if isinstance(func, tuple):
+                func_name, kwargs = func
+                result = func_name(self, **kwargs)
+            else:
+                result = func(self)
+            self.assertEqual(Code.SUCCESS, result.code)
diff --git a/setup.cfg b/setup.cfg
index 36d7ed8738..952c129d25 100644
--- a/setup.cfg
+++ b/setup.cfg
@@ -74,7 +74,7 @@ oslo.config.opts =
     sahara.config = sahara.config:list_opts
 
 oslo.config.opts.defaults =
-    sahara.config = sahara.common.config:set_cors_middleware_defaults
+    sahara.config = sahara.common.config:set_config_defaults
 
 oslo.policy.policies =
     sahara = sahara.common.policies:list_rules