diff --git a/examples/src/wait_for_callback/external_system.py b/examples/src/wait_for_callback/external_system.py
new file mode 100644
index 0000000..b6013df
--- /dev/null
+++ b/examples/src/wait_for_callback/external_system.py
@@ -0,0 +1,185 @@
+import threading
+import queue
+from enum import StrEnum
+from time import sleep
+from typing import Callable, Optional
+
+
+class RunnerMode(StrEnum):
+    """Runner mode for local or cloud execution."""
+
+    LOCAL = "local"
+    CLOUD = "cloud"
+
+
+class ExternalSystem:
+    _instance = None
+    _lock = threading.Lock()
+
+    def __new__(cls):
+        if cls._instance is None:
+            with cls._lock:
+                if cls._instance is None:
+                    cls._instance = super().__new__(cls)
+                    cls._instance._initialized = False
+        return cls._instance
+
+    def __init__(self):
+        if self._initialized:
+            return
+        self._call_queue = queue.Queue()
+        self._worker_thread = None
+        self._shutdown_flag = threading.Event()
+
+        self._mode = RunnerMode.CLOUD
+        self._success_handler = self._cloud_success_handler
+        self._failure_handler = self._cloud_failure_handler
+        self._heartbeat_handler = self._cloud_heartbeat_handler
+        self._initialized = True
+
+    @property
+    def mode(self) -> RunnerMode:
+        return self._mode
+
+    def activate_local_mode(
+        self,
+        success_handler: Optional[Callable[[str, bytes], None]] = None,
+        failure_handler: Optional[Callable[[str, Exception], None]] = None,
+        heartbeat_handler: Optional[Callable[[str], None]] = None,
+    ):
+        """Activate local mode with custom handlers."""
+        self._mode = RunnerMode.LOCAL
+        self._success_handler = success_handler
+        self._failure_handler = failure_handler
+        self._heartbeat_handler = heartbeat_handler
+
+    def activate_cloud_mode(self):
+        """Activate cloud mode with boto3 handlers."""
+        self._mode = RunnerMode.CLOUD
+        self._success_handler = self._cloud_success_handler
+        self._failure_handler = self._cloud_failure_handler
+        self._heartbeat_handler = self._cloud_heartbeat_handler
+
+    def send_success(self, callback_id: str, msg: bytes):
+        """Send success callback."""
+        self._call_queue.put(("success", callback_id, msg), timeout=0.5)
+
+    def send_failure(self, callback_id: str, error: Exception):
+        """Send failure callback."""
+        self._call_queue.put(("failure", callback_id, error), timeout=0.5)
+
+    def send_heartbeat(self, callback_id: str):
+        """Send heartbeat callback."""
+        self._call_queue.put(("heartbeat", callback_id, None), timeout=0.5)
+
+    def start(self):
+        if self._worker_thread is None or not self._worker_thread.is_alive():
+            self._worker_thread = threading.Thread(target=self._worker, daemon=True)
+            self._worker_thread.start()
+
+    def _worker(self):
+        """Background worker that processes callbacks."""
+        while not self._shutdown_flag.is_set():
+            try:
+                operation_type, callback_id, data = self._call_queue.get(timeout=0.5)
+
+                if operation_type == "success" and self._success_handler:
+                    self._success_handler(callback_id, data)
+                elif operation_type == "failure" and self._failure_handler:
+                    self._failure_handler(callback_id, data)
+                elif operation_type == "heartbeat" and self._heartbeat_handler:
+                    self._heartbeat_handler(callback_id)
+
+                self._call_queue.task_done()
+            except queue.Empty:
+                continue
+
+    def reset(self):
+        """Reset the external system state."""
+        # Clear the queue
+        while not self._call_queue.empty():
+            try:
+                self._call_queue.get_nowait()
+                self._call_queue.task_done()
+            except queue.Empty:
+                break
+
+    def shutdown(self):
+        """Shutdown the worker thread."""
+        self._shutdown_flag.set()
+
+        # Clear the queue
+        while not self._call_queue.empty():
+            try:
+                self._call_queue.get_nowait()
+                self._call_queue.task_done()
+            except queue.Empty:
+                break
+
+        # Wait for thread to finish
+        if self._worker_thread and self._worker_thread.is_alive():
+            self._worker_thread.join(timeout=1)
+
+        # Reset for next test
+        self._worker_thread = None
+        self._shutdown_flag.clear()
+
+    @classmethod
+    def reset_instance(cls):
+        """Reset the singleton instance."""
+        with cls._lock:
+            if cls._instance:
+                cls._instance.shutdown()
+            cls._instance = None
+
+    def _cloud_success_handler(self, callback_id: str, msg: bytes):
+        """Default cloud success handler using boto3."""
+        try:
+            import boto3
+            import os
+
+            client = boto3.client(
+                "lambdainternal",
+                endpoint_url=os.environ.get("LAMBDA_ENDPOINT"),
+                region_name=os.environ.get("AWS_REGION", "us-west-2"),
+            )
+
+            client.send_durable_execution_callback_success(
+                CallbackId=callback_id, Result=msg.decode("utf-8") if msg else None
+            )
+        except Exception:
+            pass  # Fail silently in cloud mode
+
+    def _cloud_failure_handler(self, callback_id: str, error: Exception):
+        """Default cloud failure handler using boto3."""
+        try:
+            import boto3
+            import os
+
+            client = boto3.client(
+                "lambdainternal",
+                endpoint_url=os.environ.get("LAMBDA_ENDPOINT"),
+                region_name=os.environ.get("AWS_REGION", "us-west-2"),
+            )
+
+            client.send_durable_execution_callback_failure(
+                CallbackId=callback_id, Error=str(error)
+            )
+        except Exception:
+            pass  # Fail silently in cloud mode
+
+    def _cloud_heartbeat_handler(self, callback_id: str):
+        """Default cloud heartbeat handler using boto3."""
+        try:
+            import boto3
+            import os
+
+            client = boto3.client(
+                "lambdainternal",
+                endpoint_url=os.environ.get("LAMBDA_ENDPOINT"),
+                region_name=os.environ.get("AWS_REGION", "us-west-2"),
+            )
+
+            client.send_durable_execution_callback_heartbeat(CallbackId=callback_id)
+        except Exception:
+            pass  # Fail silently in cloud mode
diff --git a/examples/src/wait_for_callback/wait_for_callback_failure.py b/examples/src/wait_for_callback/wait_for_callback_failure.py
new file mode 100644
index 0000000..f153b2c
--- /dev/null
+++ b/examples/src/wait_for_callback/wait_for_callback_failure.py
@@ -0,0 +1,28 @@
+from typing import Any
+
+from aws_durable_execution_sdk_python import DurableContext, durable_execution
+from aws_durable_execution_sdk_python.config import WaitForCallbackConfig, Duration
+from .external_system import ExternalSystem  # noqa: TID252
+
+external_system = ExternalSystem()  # Singleton instance
+
+
+@durable_execution
+def handler(_event: Any, context: DurableContext) -> str:
+    name = "Callback Failure"
+    config = WaitForCallbackConfig(timeout=Duration(10), retry_strategy=None)
+
+    def submitter(callback_id: str) -> None:
+        """Submitter function that triggers failure."""
+        try:
+            raise Exception("Callback failed")
+        except Exception as e:
+            external_system.send_failure(callback_id, e)
+            external_system.start()
+
+    try:
+        context.wait_for_callback(submitter, name=name, config=config)
+        return "OK"
+    except Exception as e:
+        result = str(e)
+        return result
diff --git a/examples/src/wait_for_callback/wait_for_callback_heartbeat.py b/examples/src/wait_for_callback/wait_for_callback_heartbeat.py
new file mode 100644
index 0000000..f89f4d2
--- /dev/null
+++ b/examples/src/wait_for_callback/wait_for_callback_heartbeat.py
@@ -0,0 +1,22 @@
+from typing import Any
+
+from aws_durable_execution_sdk_python import DurableContext, durable_execution
+from aws_durable_execution_sdk_python.config import WaitForCallbackConfig, Duration
+from .external_system import ExternalSystem  # noqa: TID252
+
+external_system = ExternalSystem()  # Singleton instance
+
+
+@durable_execution
+def handler(_event: Any, context: DurableContext) -> str:
+    name = "Callback Heartbeat"
+    config = WaitForCallbackConfig(timeout=Duration(30), retry_strategy=None)
+
+    def submitter(callback_id: str) -> None:
+        """Submitter function that sends heartbeat then succeeds."""
+        external_system.send_heartbeat(callback_id)
+        external_system.send_success(callback_id, b"")
+        external_system.start()
+
+    context.wait_for_callback(submitter, name=name, config=config)
+    return "OK"
diff --git a/examples/src/wait_for_callback/wait_for_callback_success.py b/examples/src/wait_for_callback/wait_for_callback_success.py
new file mode 100644
index 0000000..b978bde
--- /dev/null
+++ b/examples/src/wait_for_callback/wait_for_callback_success.py
@@ -0,0 +1,22 @@
+from typing import Any
+
+from aws_durable_execution_sdk_python import DurableContext, durable_execution
+from aws_durable_execution_sdk_python.config import WaitForCallbackConfig, Duration
+from .external_system import ExternalSystem  # noqa: TID252
+
+external_system = ExternalSystem()  # Singleton instance
+
+
+@durable_execution
+def handler(_event: Any, context: DurableContext) -> str:
+    name = "Callback Waiting"
+    config = WaitForCallbackConfig(timeout=Duration(30), retry_strategy=None)
+
+    def submitter(callback_id: str) -> None:
+        """Submitter function."""
+        external_system.send_success(callback_id, b"")
+        external_system.start()
+
+    context.wait_for_callback(submitter, name=name, config=config)
+
+    return "OK"
diff --git a/examples/test/conftest.py b/examples/test/conftest.py
index 1f329d4..b901780 100644
--- a/examples/test/conftest.py
+++ b/examples/test/conftest.py
@@ -10,7 +10,10 @@
 from typing import Any
 
 import pytest
-from aws_durable_execution_sdk_python.lambda_service import OperationPayload
+from aws_durable_execution_sdk_python.lambda_service import (
+    ErrorObject,
+    OperationPayload,
+)
 from aws_durable_execution_sdk_python.serdes import ExtendedTypeSerDes
 
 from aws_durable_execution_sdk_python_testing.runner import (
@@ -122,6 +125,29 @@ def __exit__(self, exc_type, exc_val, exc_tb):
             return self._runner.__exit__(exc_type, exc_val, exc_tb)
         return None
 
+    def succeed_callback(self, callback_id: str, result: bytes) -> None:
+        """Send callback success response."""
+        if self.mode == RunnerMode.LOCAL:
+            self._runner.send_callback_success(callback_id=callback_id, result=result)
+        else:
+            logger.warning("Current runner does not support callback success")
+
+    def fail_callback(self, callback_id: str, error: Exception | None = None) -> None:
+        """Send callback failure response."""
+        if self.mode == RunnerMode.LOCAL:
+            error_obj = ErrorObject.from_exception(error) if error else None
+            self._runner.send_callback_failure(callback_id=callback_id, error=error_obj)
+        else:
+            logger.warning("Current runner does not support callback failure")
+
+    def heartbeat_callback(self, callback_id: str) -> None:
+        """Send callback heartbeat to keep callback alive."""
+
+        if self.mode == RunnerMode.LOCAL:
+            self._runner.send_callback_heartbeat(callback_id=callback_id)
+        else:
+            logger.warning("Current runner does not support callback heartbeat")
+
 
 @pytest.fixture
 def durable_runner(request):
diff --git a/examples/test/wait_for_callback/test_wait_for_callback_failure.py b/examples/test/wait_for_callback/test_wait_for_callback_failure.py
new file mode 100644
index 0000000..81829fc
--- /dev/null
+++ b/examples/test/wait_for_callback/test_wait_for_callback_failure.py
@@ -0,0 +1,43 @@
+"""Tests for callback failure example."""
+
+from asyncio import sleep
+
+import pytest
+from aws_durable_execution_sdk_python.execution import InvocationStatus
+
+from wait_for_callback import wait_for_callback_failure
+from test.conftest import deserialize_operation_payload
+from wait_for_callback.external_system import ExternalSystem
+
+
+@pytest.mark.example
+@pytest.mark.durable_execution(
+    handler=wait_for_callback_failure.handler,
+    lambda_function_name="wait for callback failure",
+)
+def test_callback_failure(durable_runner):
+    """Test callback failure handling."""
+
+    with durable_runner:
+        external_system = ExternalSystem()
+        # Configure external system for local mode if needed
+        if durable_runner.mode == "local":
+
+            def failure_handler(callback_id: str, error: Exception):
+                sleep(0.5)  # Simulate async work
+                durable_runner.fail_callback(callback_id, str(error))
+
+            def success_handler(callback_id: str, msg: bytes):
+                durable_runner.succeed_callback(callback_id, msg)
+
+            external_system.activate_local_mode(
+                success_handler=success_handler, failure_handler=failure_handler
+            )
+
+        result = durable_runner.run(input="test", timeout=10)
+        external_system.shutdown()
+
+    # Should handle the failure gracefully
+    assert result.status is InvocationStatus.SUCCEEDED
+    assert result.result != "OK"
+    assert result.result == '"Callback failed"'
diff --git a/examples/test/wait_for_callback/test_wait_for_callback_heartbeat.py b/examples/test/wait_for_callback/test_wait_for_callback_heartbeat.py
new file mode 100644
index 0000000..e5a792c
--- /dev/null
+++ b/examples/test/wait_for_callback/test_wait_for_callback_heartbeat.py
@@ -0,0 +1,42 @@
+"""Tests for callback heartbeat example."""
+
+from asyncio import sleep
+
+import pytest
+from aws_durable_execution_sdk_python.execution import InvocationStatus
+
+from wait_for_callback import wait_for_callback_heartbeat
+from test.conftest import deserialize_operation_payload
+from wait_for_callback.external_system import ExternalSystem
+
+
+@pytest.mark.example
+@pytest.mark.durable_execution(
+    handler=wait_for_callback_heartbeat.handler,
+    lambda_function_name="wait for callback heartbeat",
+)
+def test_callback_heartbeat(durable_runner):
+    """Test callback heartbeat functionality."""
+
+    with durable_runner:
+        external_system = ExternalSystem()
+        # Configure external system for local mode if needed
+        if durable_runner.mode == "local":
+
+            def heartbeat_handler(callback_id: str):
+                sleep(0.1)  # Simulate async work
+                # durable_runner.heartbeat_callback(callback_id)
+
+            def success_handler(callback_id: str, msg: bytes):
+                sleep(0.5)
+                durable_runner.succeed_callback(callback_id, msg)
+
+            external_system.activate_local_mode(
+                success_handler=success_handler, heartbeat_handler=heartbeat_handler
+            )
+
+        result = durable_runner.run(input="test", timeout=30)
+        external_system.shutdown()
+
+    assert result.status is InvocationStatus.SUCCEEDED
+    assert deserialize_operation_payload(result.result) == "OK"
diff --git a/examples/test/wait_for_callback/test_wait_for_callback_success.py b/examples/test/wait_for_callback/test_wait_for_callback_success.py
new file mode 100644
index 0000000..e4d15f5
--- /dev/null
+++ b/examples/test/wait_for_callback/test_wait_for_callback_success.py
@@ -0,0 +1,41 @@
+"""Tests for run_in_child_context example."""
+
+from asyncio import sleep
+
+import pytest
+from aws_durable_execution_sdk_python.execution import InvocationStatus
+
+from wait_for_callback import wait_for_callback_success
+from test.conftest import deserialize_operation_payload
+from wait_for_callback.external_system import ExternalSystem
+
+
+@pytest.mark.example
+@pytest.mark.durable_execution(
+    handler=wait_for_callback_success.handler,
+    lambda_function_name="wait for callback success",
+)
+def test_callback_success(durable_runner):
+    """Test run_in_child_context example."""
+    with durable_runner:
+        external_system = ExternalSystem()  # Singleton instance
+        # Configure external system for local mode if needed
+        if durable_runner.mode == "local":
+
+            def success_handler(callback_id: str, msg: bytes):
+                sleep(0.5)
+                durable_runner.succeed_callback(callback_id, msg)
+
+            external_system.activate_local_mode(success_handler=success_handler)
+
+        result = durable_runner.run(input="test", timeout=10)
+        external_system.shutdown()
+
+    assert result.status is InvocationStatus.SUCCEEDED
+    assert deserialize_operation_payload(result.result) == "OK"
+
+    # Verify child context operation exists
+    context_ops = [
+        op for op in result.operations if op.operation_type.value == "CONTEXT"
+    ]
+    assert len(context_ops) >= 1
diff --git a/src/aws_durable_execution_sdk_python_testing/runner.py b/src/aws_durable_execution_sdk_python_testing/runner.py
index cb88999..d0bd528 100644
--- a/src/aws_durable_execution_sdk_python_testing/runner.py
+++ b/src/aws_durable_execution_sdk_python_testing/runner.py
@@ -558,6 +558,15 @@ def run(
         execution: Execution = self._store.load(output.execution_arn)
         return DurableFunctionTestResult.create(execution=execution)
 
+    def send_callback_success(self, callback_id: str, result: bytes):
+        self._executor.send_callback_success(callback_id=callback_id, result=result)
+
+    def send_callback_failure(self, callback_id: str, error: ErrorObject | None):
+        self._executor.send_callback_failure(callback_id=callback_id, error=error)
+
+    def send_callback_heartbeat(self, callback_id: str):
+        self._executor.send_callback_heartbeat(callback_id=callback_id)
+
 
 class DurableChildContextTestRunner(DurableFunctionTestRunner):
     """Test a durable block, annotated with @durable_with_child_context, in isolation."""