diff --git a/examples/restate_attribute_demo.rs b/examples/restate_attribute_demo.rs
new file mode 100644
index 0000000..f1b9b09
--- /dev/null
+++ b/examples/restate_attribute_demo.rs
@@ -0,0 +1,99 @@
+use restate_sdk::prelude::*;
+
+/// This example demonstrates the new #[restate(...)] attribute syntax
+/// for configuring handler behavior.
+#[restate_sdk::object]
+trait ProductInventory {
+    /// Shared handler with timeout configuration
+    /// This handler can run concurrently with others and has a 30-second inactivity timeout
+    #[restate(shared, inactivity_timeout = "30s")]
+    async fn get_stock() -> Result<u32, TerminalError>;
+
+    /// Regular handler with custom timeouts
+    /// This handler has exclusive access to state and custom timeout settings
+    #[restate(inactivity_timeout = "1m", abort_timeout = "10s")]
+    async fn update_stock(quantity: u32) -> Result<(), TerminalError>;
+
+    /// Shared handler with lazy state enabled
+    /// Useful for read-heavy operations where state is loaded on-demand
+    #[restate(shared = true, lazy_state = true, inactivity_timeout = "45s")]
+    async fn check_availability() -> Result<bool, TerminalError>;
+
+    /// Regular handler without special configuration
+    async fn reserve_stock(quantity: u32) -> Result<bool, TerminalError>;
+
+    /// Handler demonstrating different duration formats
+    #[restate(inactivity_timeout = "500ms", abort_timeout = "2h")]
+    async fn quick_check() -> Result<(), TerminalError>;
+}
+
+struct ProductInventoryImpl;
+
+const STOCK_KEY: &str = "stock";
+
+impl ProductInventory for ProductInventoryImpl {
+    async fn get_stock(&self, ctx: SharedObjectContext<'_>) -> Result<u32, TerminalError> {
+        println!("Getting stock");
+        Ok(ctx.get::<u32>(STOCK_KEY).await?.unwrap_or(0))
+    }
+
+    async fn update_stock(
+        &self,
+        ctx: ObjectContext<'_>,
+        quantity: u32,
+    ) -> Result<(), TerminalError> {
+        println!("Updating stock to {}", quantity);
+        ctx.set(STOCK_KEY, quantity);
+        Ok(())
+    }
+
+    async fn check_availability(
+        &self,
+        ctx: SharedObjectContext<'_>,
+    ) -> Result<bool, TerminalError> {
+        println!("Checking availability");
+        let stock = ctx.get::<u32>(STOCK_KEY).await?.unwrap_or(0);
+        Ok(stock > 0)
+    }
+
+    async fn reserve_stock(
+        &self,
+        ctx: ObjectContext<'_>,
+        quantity: u32,
+    ) -> Result<bool, TerminalError> {
+        println!("Reserving {} units", quantity);
+        let current = ctx.get::<u32>(STOCK_KEY).await?.unwrap_or(0);
+
+        if current >= quantity {
+            ctx.set(STOCK_KEY, current - quantity);
+            Ok(true)
+        } else {
+            Ok(false)
+        }
+    }
+
+    async fn quick_check(&self, _ctx: ObjectContext<'_>) -> Result<(), TerminalError> {
+        println!("Quick check");
+        Ok(())
+    }
+}
+
+#[tokio::main]
+async fn main() {
+    tracing_subscriber::fmt::init();
+
+    println!("Starting Product Inventory service with new #[restate(...)] attribute syntax");
+    println!("This example demonstrates:");
+    println!("  - Shared handlers with configurable timeouts");
+    println!("  - Lazy state loading");
+    println!("  - Various duration formats (ms, s, m, h)");
+    println!("  - Mixing multiple configuration options");
+
+    HttpServer::new(
+        Endpoint::builder()
+            .bind(ProductInventoryImpl.serve())
+            .build(),
+    )
+    .listen_and_serve("0.0.0.0:9080".parse().unwrap())
+    .await;
+}
diff --git a/macros/Cargo.toml b/macros/Cargo.toml
index 6a26bc8..ab7ae07 100644
--- a/macros/Cargo.toml
+++ b/macros/Cargo.toml
@@ -13,4 +13,5 @@ proc-macro = true
 [dependencies]
 proc-macro2 = "1.0"
 quote = "1.0"
+humantime = "2.3"
 syn = { version = "2.0", features = ["full"] }
diff --git a/macros/src/ast.rs b/macros/src/ast.rs
index 010de80..7cbe4b6 100644
--- a/macros/src/ast.rs
+++ b/macros/src/ast.rs
@@ -11,12 +11,13 @@
 // Some parts copied from https://github.com/dtolnay/thiserror/blob/39aaeb00ff270a49e3c254d7b38b10e934d3c7a5/impl/src/ast.rs
 // License Apache-2.0 or MIT
 
+use quote::ToTokens;
 use syn::ext::IdentExt;
 use syn::parse::{Parse, ParseStream};
 use syn::spanned::Spanned;
 use syn::token::Comma;
 use syn::{
-    Attribute, Error, Expr, ExprLit, FnArg, GenericArgument, Ident, Lit, Pat, PatType, Path,
+    Attribute, Error, Expr, ExprLit, FnArg, GenericArgument, Ident, Lit, Meta, Pat, PatType, Path,
     PathArguments, Result, ReturnType, Token, Type, Visibility, braced, parenthesized, parse_quote,
 };
 
@@ -83,7 +84,7 @@ impl ServiceInner {
         while !content.is_empty() {
             let h: Handler = content.parse()?;
 
-            if h.is_shared && service_type == ServiceType::Service {
+            if h.config.shared && service_type == ServiceType::Service {
                 return Err(Error::new(
                     h.ident.span(),
                     "Service handlers cannot be annotated with #[shared]",
@@ -139,10 +140,78 @@ impl ServiceInner {
     }
 }
 
+/// Parsed configuration from #[restate(...)] attribute
+#[derive(Default)]
+pub(crate) struct HandlerConfig {
+    pub(crate) shared: bool,
+    pub(crate) lazy_state: bool,
+    pub(crate) inactivity_timeout: Option<u64>,
+    pub(crate) abort_timeout: Option<u64>,
+}
+
+/// Parse a duration string like "30s", "5m", "1h" into milliseconds
+fn parse_duration_ms(s: &str, span: proc_macro2::Span) -> Result<u64> {
+    let duration: humantime::Duration = s
+        .trim()
+        .parse()
+        .map_err(|err| Error::new(span, format!("Failed to parse duration: {err}")))?;
+
+    u64::try_from(duration.as_millis()).map_err(|_| Error::new(span, "Duration overflows u64"))
+}
+
+/// Parse #[restate(...)] attribute
+fn parse_restate_attr(attr: &Attribute) -> Result<HandlerConfig> {
+    let mut result = HandlerConfig::default();
+
+    let meta_list = match &attr.meta {
+        Meta::List(list) => list,
+        _ => return Err(Error::new_spanned(attr, "Expected #[restate(...)]")),
+    };
+
+    // Parse the nested meta items
+    meta_list.parse_nested_meta(|meta| {
+        let path = &meta.path;
+
+        // Check if this is a boolean flag (e.g., "shared") or named value (e.g., "shared=true")
+        if path.is_ident("shared") {
+            if meta.input.peek(Token![=]) {
+                // Parse as "shared = true" or "shared = false"
+                let value: syn::LitBool = meta.value()?.parse()?;
+                result.shared = value.value;
+            } else {
+                // Parse as just "shared" (flag syntax)
+                result.shared = true;
+            }
+        } else if path.is_ident("lazy_state") {
+            if meta.input.peek(Token![=]) {
+                let value: syn::LitBool = meta.value()?.parse()?;
+                result.lazy_state = value.value;
+            } else {
+                result.lazy_state = true;
+            }
+        } else if path.is_ident("inactivity_timeout") {
+            let value: syn::LitStr = meta.value()?.parse()?;
+            result.inactivity_timeout = Some(parse_duration_ms(&value.value(), value.span())?);
+        } else if path.is_ident("abort_timeout") {
+            let value: syn::LitStr = meta.value()?.parse()?;
+            result.abort_timeout = Some(parse_duration_ms(&value.value(), value.span())?);
+        } else {
+            return Err(meta.error(format!(
+                "Unknown restate attribute: {}. Supported attributes are: \
+                shared, lazy_state, inactivity_timeout, abort_timeout",
+                path.to_token_stream()
+            )));
+        }
+
+        Ok(())
+    })?;
+
+    Ok(result)
+}
+
 pub(crate) struct Handler {
     pub(crate) attrs: Vec<Attribute>,
-    pub(crate) is_shared: bool,
-    pub(crate) is_lazy_state: bool,
+    pub(crate) config: HandlerConfig,
     pub(crate) restate_name: String,
     pub(crate) ident: Ident,
     pub(crate) arg: Option<PatType>,
@@ -198,7 +267,8 @@ impl Parse for Handler {
             ReturnType::Default => {
                 return Err(Error::new(
                     return_type.span(),
-                    "The return type cannot be empty, only Result or restate_sdk::prelude::HandlerResult is supported as return type",
+                    "The return type cannot be empty, only Result or \
+                     restate_sdk::prelude::HandlerResult is supported as return type",
                 ));
             }
             ReturnType::Type(_, ty) => {
@@ -214,15 +284,16 @@ impl Parse for Handler {
         };
 
         // Process attributes
-        let mut is_shared = false;
-        let mut is_lazy_state = false;
         let mut restate_name = ident.to_string();
         let mut attrs = vec![];
+        let mut config = HandlerConfig::default();
+        let mut has_legacy_shared = false;
         for attr in parsed_attrs {
             if is_shared_attr(&attr) {
-                is_shared = true;
-            } else if is_lazy_state_attr(&attr) {
-                is_lazy_state = true;
+                // support deprecated shared
+                has_legacy_shared = true;
+            } else if is_restate_attr(&attr) {
+                config = parse_restate_attr(&attr)?;
             } else if let Some(name) = read_literal_attribute_name(&attr)? {
                 restate_name = name;
             } else {
@@ -231,10 +302,13 @@ impl Parse for Handler {
             }
         }
 
+        if has_legacy_shared {
+            config.shared = true;
+        }
+
         Ok(Self {
             attrs,
-            is_shared,
-            is_lazy_state,
+            config,
             restate_name,
             ident,
             arg: args.pop(),
@@ -251,11 +325,12 @@ fn is_shared_attr(attr: &Attribute) -> bool {
         .is_ok_and(|i| i == "shared")
 }
 
-fn is_lazy_state_attr(attr: &Attribute) -> bool {
-    attr.meta
-        .require_path_only()
-        .and_then(Path::require_ident)
-        .is_ok_and(|i| i == "lazy_state")
+fn is_restate_attr(attr: &Attribute) -> bool {
+    if let Meta::List(list) = &attr.meta {
+        list.path.is_ident("restate")
+    } else {
+        false
+    }
 }
 
 fn read_literal_attribute_name(attr: &Attribute) -> Result<Option<String>> {
diff --git a/macros/src/generator.rs b/macros/src/generator.rs
index 929f021..f396681 100644
--- a/macros/src/generator.rs
+++ b/macros/src/generator.rs
@@ -1,4 +1,4 @@
-use crate::ast::{Handler, Object, Service, ServiceInner, ServiceType, Workflow};
+use crate::ast::{Handler, HandlerConfig, Object, Service, ServiceInner, ServiceType, Workflow};
 use proc_macro2::TokenStream as TokenStream2;
 use proc_macro2::{Ident, Literal};
 use quote::{ToTokens, format_ident, quote};
@@ -55,10 +55,10 @@ impl<'a> ServiceGenerator<'a> {
         let handler_fns = handlers
             .iter()
             .map(
-                |Handler { attrs, ident, arg, is_shared, output_ok, output_err, .. }| {
+                |Handler { attrs, ident, arg, config: HandlerConfig{shared, ..}, output_ok, output_err, .. }| {
                     let args = arg.iter();
 
-                    let ctx = match (&service_ty, is_shared) {
+                    let ctx = match (&service_ty, shared) {
                         (ServiceType::Service, _) => quote! { ::restate_sdk::prelude::Context },
                         (ServiceType::Object, true) => quote! { ::restate_sdk::prelude::SharedObjectContext },
                         (ServiceType::Object, false) => quote! { ::restate_sdk::prelude::ObjectContext },
@@ -185,7 +185,7 @@ impl<'a> ServiceGenerator<'a> {
         let handlers = handlers.iter().map(|handler| {
             let handler_literal = Literal::string(&handler.restate_name);
 
-            let handler_ty = if handler.is_shared {
+            let handler_ty = if handler.config.shared {
                 quote! { Some(::restate_sdk::discovery::HandlerType::Shared) }
             } else if *service_ty == ServiceType::Workflow {
                 quote! { Some(::restate_sdk::discovery::HandlerType::Workflow) }
@@ -194,12 +194,20 @@ impl<'a> ServiceGenerator<'a> {
                 quote! { None }
             };
 
-            let lazy_state = if handler.is_lazy_state {
+            let lazy_state = if handler.config.lazy_state {
                 quote! { Some(true) }
             } else {
                 quote! { None}
             };
 
+            let inactivity_timeout = handler.config.inactivity_timeout.map(|timeout| {
+                quote! { Some(#timeout) }
+            }).unwrap_or_else(|| quote! { None });
+
+            let abort_timeout = handler.config.abort_timeout.map(|timeout| {
+                quote! { Some(#timeout) }
+            }).unwrap_or_else(|| quote! { None });
+
             let input_schema = match &handler.arg {
                 Some(PatType { ty, .. }) => {
                     quote! {
@@ -229,8 +237,8 @@ impl<'a> ServiceGenerator<'a> {
                     ty: #handler_ty,
                     documentation: None,
                     metadata: Default::default(),
-                    abort_timeout: None,
-                    inactivity_timeout: None,
+                    abort_timeout: #abort_timeout,
+                    inactivity_timeout: #inactivity_timeout,
                     journal_retention: None,
                     idempotency_retention: None,
                     workflow_completion_retention: None,
diff --git a/tests/backward_compat_test.rs b/tests/backward_compat_test.rs
new file mode 100644
index 0000000..cab3f8e
--- /dev/null
+++ b/tests/backward_compat_test.rs
@@ -0,0 +1,40 @@
+use restate_sdk::prelude::*;
+
+// Test backward compatibility with the old #[shared] attribute
+#[restate_sdk::object]
+trait BackwardCompatObject {
+    // Old syntax should still work
+    #[shared]
+    async fn legacy_shared() -> HandlerResult<String>;
+
+    // Mix old and new syntax (as long as they don't conflict)
+    #[shared]
+    #[restate(inactivity_timeout = "30s")]
+    async fn mixed_syntax() -> HandlerResult<String>;
+
+    // New syntax
+    #[restate(shared)]
+    async fn new_shared() -> HandlerResult<String>;
+}
+
+struct BackwardCompatObjectImpl;
+
+impl BackwardCompatObject for BackwardCompatObjectImpl {
+    async fn legacy_shared(&self, _ctx: SharedObjectContext<'_>) -> HandlerResult<String> {
+        Ok("legacy".to_string())
+    }
+
+    async fn mixed_syntax(&self, _ctx: SharedObjectContext<'_>) -> HandlerResult<String> {
+        Ok("mixed".to_string())
+    }
+
+    async fn new_shared(&self, _ctx: SharedObjectContext<'_>) -> HandlerResult<String> {
+        Ok("new".to_string())
+    }
+}
+
+#[test]
+fn test_backward_compatibility() {
+    // This test verifies backward compatibility with old attributes
+    let _service = BackwardCompatObjectImpl.serve();
+}
diff --git a/tests/restate_attribute_test.rs b/tests/restate_attribute_test.rs
new file mode 100644
index 0000000..c7c76a0
--- /dev/null
+++ b/tests/restate_attribute_test.rs
@@ -0,0 +1,86 @@
+use restate_sdk::prelude::*;
+
+// Test the new #[restate(...)] attribute with various configurations
+#[restate_sdk::object]
+trait TestObject {
+    // Test using just the shared flag
+    #[restate(shared)]
+    async fn test_shared_flag() -> HandlerResult<String>;
+
+    // Test using named boolean syntax
+    #[restate(shared = true)]
+    async fn test_shared_named() -> HandlerResult<String>;
+
+    // Test using lazy_state flag
+    #[restate(lazy_state)]
+    async fn test_lazy_state_flag() -> HandlerResult<String>;
+
+    // Test combining multiple attributes
+    #[restate(shared, lazy_state = false)]
+    async fn test_combined() -> HandlerResult<String>;
+
+    // Test with timeout configuration
+    #[restate(inactivity_timeout = "30s")]
+    async fn test_inactivity_timeout() -> HandlerResult<()>;
+
+    // Test with multiple timeout configurations
+    #[restate(shared, inactivity_timeout = "30s", abort_timeout = "5m")]
+    async fn test_multiple_timeouts() -> HandlerResult<String>;
+
+    // Test with various duration formats
+    #[restate(inactivity_timeout = "100ms")]
+    async fn test_milliseconds() -> HandlerResult<()>;
+
+    #[restate(abort_timeout = "2h")]
+    async fn test_hours() -> HandlerResult<()>;
+
+    // Regular handler without any special config
+    async fn regular_handler() -> HandlerResult<()>;
+}
+
+struct TestObjectImpl;
+
+impl TestObject for TestObjectImpl {
+    async fn test_shared_flag(&self, _ctx: SharedObjectContext<'_>) -> HandlerResult<String> {
+        Ok("shared flag".to_string())
+    }
+
+    async fn test_shared_named(&self, _ctx: SharedObjectContext<'_>) -> HandlerResult<String> {
+        Ok("shared named".to_string())
+    }
+
+    async fn test_lazy_state_flag(&self, _ctx: ObjectContext<'_>) -> HandlerResult<String> {
+        Ok("lazy state flag".to_string())
+    }
+
+    async fn test_combined(&self, _ctx: SharedObjectContext<'_>) -> HandlerResult<String> {
+        Ok("combined".to_string())
+    }
+
+    async fn test_inactivity_timeout(&self, _ctx: ObjectContext<'_>) -> HandlerResult<()> {
+        Ok(())
+    }
+
+    async fn test_multiple_timeouts(&self, _ctx: SharedObjectContext<'_>) -> HandlerResult<String> {
+        Ok("multiple timeouts".to_string())
+    }
+
+    async fn test_milliseconds(&self, _ctx: ObjectContext<'_>) -> HandlerResult<()> {
+        Ok(())
+    }
+
+    async fn test_hours(&self, _ctx: ObjectContext<'_>) -> HandlerResult<()> {
+        Ok(())
+    }
+
+    async fn regular_handler(&self, _ctx: ObjectContext<'_>) -> HandlerResult<()> {
+        Ok(())
+    }
+}
+
+#[test]
+fn test_restate_attribute_compiles() {
+    // This test just verifies that the code compiles correctly
+    // The actual functionality is tested through the discovery mechanism
+    let _service = TestObjectImpl.serve();
+}