diff --git a/internal/cloud/backend.go b/internal/cloud/backend.go
index cff9d7e2b..188996177 100644
--- a/internal/cloud/backend.go
+++ b/internal/cloud/backend.go
@@ -636,7 +636,7 @@ func (b *Cloud) Operation(ctx context.Context, op *backend.Operation) (*backend.
 	b.IgnoreVersionConflict()
 
 	// Check if we need to use the local backend to run the operation.
-	if b.forceLocal || !w.Operations {
+	if b.forceLocal || isLocalExecutionMode(w.ExecutionMode) {
 		// Record that we're forced to run operations locally to allow the
 		// command package UI to operate correctly
 		b.forceLocal = true
@@ -825,9 +825,9 @@ func (b *Cloud) VerifyWorkspaceTerraformVersion(workspaceName string) tfdiags.Di
 		return nil
 	}
 
-	// If the workspace has remote operations disabled, the remote Terraform
+	// If the workspace has execution-mode set to local, the remote Terraform
 	// version is effectively meaningless, so we'll skip version verification.
-	if !workspace.Operations {
+	if isLocalExecutionMode(workspace.ExecutionMode) {
 		return nil
 	}
 
@@ -965,6 +965,10 @@ func (wm WorkspaceMapping) Strategy() workspaceStrategy {
 	}
 }
 
+func isLocalExecutionMode(execMode string) bool {
+	return execMode == "local"
+}
+
 func (wm WorkspaceMapping) tfeTags() []*tfe.Tag {
 	var tags []*tfe.Tag
 
diff --git a/internal/cloud/backend_apply_test.go b/internal/cloud/backend_apply_test.go
index d741662cd..6c4ea4106 100644
--- a/internal/cloud/backend_apply_test.go
+++ b/internal/cloud/backend_apply_test.go
@@ -1447,36 +1447,36 @@ func TestCloud_applyVersionCheck(t *testing.T) {
 		localVersion  string
 		remoteVersion string
 		forceLocal    bool
-		hasOperations bool
+		executionMode string
 		wantErr       string
 	}{
 		"versions can be different for remote apply": {
 			localVersion:  "0.14.0",
 			remoteVersion: "0.13.5",
-			hasOperations: true,
+			executionMode: "remote",
 		},
 		"versions can be different for local apply": {
 			localVersion:  "0.14.0",
 			remoteVersion: "0.13.5",
-			hasOperations: false,
+			executionMode: "local",
 		},
 		"force local with remote operations and different versions is acceptable": {
 			localVersion:  "0.14.0",
 			remoteVersion: "0.14.0-acme-provider-bundle",
 			forceLocal:    true,
-			hasOperations: true,
+			executionMode: "remote",
 		},
 		"no error if versions are identical": {
 			localVersion:  "0.14.0",
 			remoteVersion: "0.14.0",
 			forceLocal:    true,
-			hasOperations: true,
+			executionMode: "remote",
 		},
 		"no error if force local but workspace has remote operations disabled": {
 			localVersion:  "0.14.0",
 			remoteVersion: "0.13.5",
 			forceLocal:    true,
-			hasOperations: false,
+			executionMode: "local",
 		},
 	}
 
@@ -1512,7 +1512,7 @@ func TestCloud_applyVersionCheck(t *testing.T) {
 				b.organization,
 				b.WorkspaceMapping.Name,
 				tfe.WorkspaceUpdateOptions{
-					Operations:       tfe.Bool(tc.hasOperations),
+					ExecutionMode:    tfe.String(tc.executionMode),
 					TerraformVersion: tfe.String(tc.remoteVersion),
 				},
 			)
@@ -1566,7 +1566,7 @@ func TestCloud_applyVersionCheck(t *testing.T) {
 				hasRemote := strings.Contains(output, "Running apply in Terraform Cloud")
 				hasSummary := strings.Contains(output, "1 added, 0 changed, 0 destroyed")
 				hasResources := run.State.HasManagedResourceInstanceObjects()
-				if !tc.forceLocal && tc.hasOperations {
+				if !tc.forceLocal && !isLocalExecutionMode(tc.executionMode) {
 					if !hasRemote {
 						t.Errorf("missing TFC header in output: %s", output)
 					}
diff --git a/internal/cloud/backend_test.go b/internal/cloud/backend_test.go
index 3bb9e148d..68e3c4167 100644
--- a/internal/cloud/backend_test.go
+++ b/internal/cloud/backend_test.go
@@ -680,31 +680,31 @@ func TestCloud_StateMgr_versionCheckLatest(t *testing.T) {
 
 func TestCloud_VerifyWorkspaceTerraformVersion(t *testing.T) {
 	testCases := []struct {
-		local      string
-		remote     string
-		operations bool
-		wantErr    bool
+		local         string
+		remote        string
+		executionMode string
+		wantErr       bool
 	}{
-		{"0.13.5", "0.13.5", true, false},
-		{"0.14.0", "0.13.5", true, true},
-		{"0.14.0", "0.13.5", false, false},
-		{"0.14.0", "0.14.1", true, false},
-		{"0.14.0", "1.0.99", true, false},
-		{"0.14.0", "1.1.0", true, false},
-		{"0.14.0", "1.2.0", true, true},
-		{"1.2.0", "1.2.99", true, false},
-		{"1.2.0", "1.3.0", true, true},
-		{"0.15.0", "latest", true, false},
-		{"1.1.5", "~> 1.1.1", true, false},
-		{"1.1.5", "> 1.1.0, < 1.3.0", true, false},
-		{"1.1.5", "~> 1.0.1", true, true},
+		{"0.13.5", "0.13.5", "agent", false},
+		{"0.14.0", "0.13.5", "remote", true},
+		{"0.14.0", "0.13.5", "local", false},
+		{"0.14.0", "0.14.1", "remote", false},
+		{"0.14.0", "1.0.99", "remote", false},
+		{"0.14.0", "1.1.0", "remote", false},
+		{"0.14.0", "1.2.0", "remote", true},
+		{"1.2.0", "1.2.99", "remote", false},
+		{"1.2.0", "1.3.0", "remote", true},
+		{"0.15.0", "latest", "remote", false},
+		{"1.1.5", "~> 1.1.1", "remote", false},
+		{"1.1.5", "> 1.1.0, < 1.3.0", "remote", false},
+		{"1.1.5", "~> 1.0.1", "remote", true},
 		// pre-release versions are comparable within their pre-release stage (dev,
 		// alpha, beta), but not comparable to different stages and not comparable
 		// to final releases.
-		{"1.1.0-beta1", "1.1.0-beta1", true, false},
-		{"1.1.0-beta1", "~> 1.1.0-beta", true, false},
-		{"1.1.0", "~> 1.1.0-beta", true, true},
-		{"1.1.0-beta1", "~> 1.1.0-dev", true, true},
+		{"1.1.0-beta1", "1.1.0-beta1", "remote", false},
+		{"1.1.0-beta1", "~> 1.1.0-beta", "remote", false},
+		{"1.1.0", "~> 1.1.0-beta", "remote", true},
+		{"1.1.0-beta1", "~> 1.1.0-dev", "remote", true},
 	}
 	for _, tc := range testCases {
 		t.Run(fmt.Sprintf("local %s, remote %s", tc.local, tc.remote), func(t *testing.T) {
@@ -735,7 +735,7 @@ func TestCloud_VerifyWorkspaceTerraformVersion(t *testing.T) {
 				b.organization,
 				b.WorkspaceMapping.Name,
 				tfe.WorkspaceUpdateOptions{
-					Operations:       tfe.Bool(tc.operations),
+					ExecutionMode:    &tc.executionMode,
 					TerraformVersion: tfe.String(tc.remote),
 				},
 			); err != nil {
diff --git a/internal/cloud/tfe_client_mock.go b/internal/cloud/tfe_client_mock.go
index 929e39b89..2725d8178 100644
--- a/internal/cloud/tfe_client_mock.go
+++ b/internal/cloud/tfe_client_mock.go
@@ -1165,13 +1165,16 @@ func (m *MockWorkspaces) Create(ctx context.Context, organization string, option
 	}
 	if strings.HasSuffix(*options.Name, "no-operations") {
 		options.Operations = tfe.Bool(false)
+		options.ExecutionMode = tfe.String("local")
 	} else if options.Operations == nil {
 		options.Operations = tfe.Bool(true)
+		options.ExecutionMode = tfe.String("remote")
 	}
 	w := &tfe.Workspace{
-		ID:         GenerateID("ws-"),
-		Name:       *options.Name,
-		Operations: *options.Operations,
+		ID:            GenerateID("ws-"),
+		Name:          *options.Name,
+		ExecutionMode: *options.ExecutionMode,
+		Operations:    *options.Operations,
 		Permissions: &tfe.WorkspacePermissions{
 			CanQueueApply: true,
 			CanQueueRun:   true,
@@ -1276,6 +1279,9 @@ func updateMockWorkspaceAttributes(w *tfe.Workspace, options tfe.WorkspaceUpdate
 	if options.Operations != nil {
 		w.Operations = *options.Operations
 	}
+	if options.ExecutionMode != nil {
+		w.ExecutionMode = *options.ExecutionMode
+	}
 	if options.Name != nil {
 		w.Name = *options.Name
 	}