diff --git a/test/eager/test_eager_with_torch_compile.py b/test/eager/test_eager_with_torch_compile.py
new file mode 100644
index 00000000000..e7604658aa5
--- /dev/null
+++ b/test/eager/test_eager_with_torch_compile.py
@@ -0,0 +1,56 @@
+import unittest
+import sys
+
+import torch
+import torch_xla
+import torch_xla.debug.metrics as met
+import torch_xla.core.xla_model as xm
+
+
+class EagerWithTorchCompileTest(unittest.TestCase):
+
+  @classmethod
+  def setUpClass(cls):
+    torch_xla.experimental.eager_mode(True)
+
+  def dummy_cos_sin(self, tensor):
+    return torch.cos(torch.sin(tensor))
+
+  def test_eager_with_compile_basic(self):
+    met.clear_all()
+    self.assertTrue(torch_xla.experimental.is_eager_mode())
+    device = torch_xla.device()
+
+    # this part happens eagerly
+    t1 = torch.randn(5, 5, device=device)
+    t1 *= 5
+
+    t2 = self.dummy_cos_sin(t1)
+    t2_compiled = torch.compile(self.dummy_cos_sin, backend="openxla")(t1)
+    self.assertTrue(torch.allclose(t2, t2_compiled))
+    xm.wait_device_ops()
+    # We execute one compiled graph
+    self.assertEqual(met.metric_data("ExecuteTime")[0], 1)
+    # and many eager ops
+    self.assertGreater(met.metric_data("EagerOpExecuteTime")[0], 5)
+
+
+def test_eager_execute_compiled_multiple_times(self):
+  met.clear_all()
+  self.assertTrue(torch_xla.experimental.is_eager_mode())
+  device = torch_xla.device()
+  # this part happens eagerly
+  t1 = torch.randn(10, 5, device=device)
+  t1.add_(0.5)
+  compiled = torch.compile(self.dummy_cos_sin, backend="openxla")
+  res = compiled(compiled(t1))
+  self.assertTrue(
+      torch.allclose(res * 0.3,
+                     self.dummy_cos_sin(self.dummy_cos_sin(t1)) * 0.3))
+  xm.wait_device_ops()
+  self.assertEqual(met.metric_data("ExecuteTime")[0], 2)
+
+
+if __name__ == '__main__':
+  test = unittest.main()
+  sys.exit(0 if test.result.wasSuccessful() else 1)
diff --git a/test/run_tests.sh b/test/run_tests.sh
index b72b00e9c8e..ae5455a1142 100755
--- a/test/run_tests.sh
+++ b/test/run_tests.sh
@@ -199,12 +199,13 @@ function run_xla_op_tests1 {
   run_save_tensor_hlo "$CDIR/spmd/test_spmd_graph_dump.py"
 }
 
-# DO NOT MODIFY
 function run_xla_op_tests2 {
   run_downcast_bf16 "$CDIR/test_data_type.py"
   run_test "$CDIR/pjrt/test_dtypes.py"
   run_test "$CDIR/test_fori_loop_with_while_loop_simple_add_dispatch_in_torch.py"
-  run_test "$CDIR/test_autocast.py"  # TODO(yeounoh) this is expensive on GPU
+  run_test "$CDIR/test_autocast.py"
+  run_test "$CDIR/eager/test_eager_with_xla_compile.py"
+  run_test "$CDIR/eager/test_eager_with_torch_compile.py"  
 }
 
 # All the new xla op tests should go to run_xla_op_tests3
diff --git a/torch_xla/core/dynamo_bridge.py b/torch_xla/core/dynamo_bridge.py
index f6d7a3b6e00..1ef3bc97d4f 100644
--- a/torch_xla/core/dynamo_bridge.py
+++ b/torch_xla/core/dynamo_bridge.py
@@ -598,6 +598,12 @@ def allow_cpu_device(self, node: torch.fx.Node):
 
 
 def extract_compiled_graph(xla_model: torch.fx.GraphModule, xla_args):
+  # graph extraction must happens under tracing mode
+  with torch_xla.experimental.eager_mode_context(False):
+    return extract_compiled_graph_helper(xla_model, xla_args)
+
+
+def extract_compiled_graph_helper(xla_model: torch.fx.GraphModule, xla_args):
   if _args_on_cuda(xla_args):
     xla_args = tuple(_maybe_move_tensors_to_device(xla_args, xm.xla_device()))
 
diff --git a/torch_xla/csrc/debug_util.cpp b/torch_xla/csrc/debug_util.cpp
index c82369045bf..43c9210f6a3 100644
--- a/torch_xla/csrc/debug_util.cpp
+++ b/torch_xla/csrc/debug_util.cpp
@@ -317,7 +317,7 @@ void DebugUtil::analyze_graph_execution_python_frame(
                endsWith(frames[1].file, "profiler.py")) {
       ss << debug_output_prefix
          << "  mark_step when exiting a profiler StepTrace region\n";
-    } else if ((frames[1].function == "extract_compiled_graph" ||
+    } else if ((frames[1].function == "extract_compiled_graph_helper" ||
                 frames[1].function == "extract_internal") &&
                endsWith(frames[1].file, "dynamo_bridge.py")) {
       ss << debug_output_prefix
diff --git a/torch_xla/experimental/__init__.py b/torch_xla/experimental/__init__.py
index 1676e7d6349..8c0be4922e5 100644
--- a/torch_xla/experimental/__init__.py
+++ b/torch_xla/experimental/__init__.py
@@ -1,7 +1,8 @@
-from .eager import eager_mode, compile, is_eager_mode
+from .eager import eager_mode, compile, is_eager_mode, eager_mode_context
 
 __all__ = [
     "eager_mode",
     "compile",
     "is_eager_mode",
+    "eager_mode_context",
 ]
diff --git a/torch_xla/experimental/eager.py b/torch_xla/experimental/eager.py
index 085df0419c3..bfc8dd69ca6 100644
--- a/torch_xla/experimental/eager.py
+++ b/torch_xla/experimental/eager.py
@@ -1,4 +1,5 @@
 import functools
+from contextlib import contextmanager
 
 import torch_xla
 
@@ -18,6 +19,18 @@ def is_eager_mode() -> bool:
   return torch_xla._XLAC._get_use_eager_mode()
 
 
+@contextmanager
+def eager_mode_context(enable: bool):
+  """Context manager to enable/disable the eager mode.
+  """
+  saved_eager_mode = is_eager_mode()
+  eager_mode(enable)
+  try:
+    yield saved_eager_mode
+  finally:
+    eager_mode(saved_eager_mode)
+
+
 def compile(func):
   """Compile the func with Lazy Tensor.
 
@@ -35,12 +48,12 @@ def wrapper(*args, **kwargs):
     try:
       # Target Function Execution
       result = func(*args, **kwargs)
+      # Sync the graph generated by the target function.
+      torch_xla.sync()
     except Exception as e:
       # Handle exceptions (if needed)
       print(f"Error in target function: {e}")
       raise  # Re-raise the exception
-    # Sync the graph generated by the target function.
-    torch_xla.sync()
     torch_xla._XLAC._set_use_eager_mode(True)
 
     return result