diff --git a/CHANGELOG.md b/CHANGELOG.md
index 7c734120f..538b01f1e 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -89,6 +89,8 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 
 ### Changed
 
+- Upgraded `deepgram-sdk` to 4.1.0.
+
 - Updated `GoogleTTSService` to use Google's streaming TTS API. The default
   voice also updated to `en-US-Chirp3-HD-Charon`.
 
@@ -145,6 +147,9 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 
 ### Fixed
 
+- Fixed a `DeegramSTTService` connection issue when the user provided their own
+  `LiveOptions`.
+
 - Fixed a `DailyTransport` issue that would cause images needing resize to block
   the event loop.
 
diff --git a/pyproject.toml b/pyproject.toml
index 7452ca1cd..a2e50906d 100644
--- a/pyproject.toml
+++ b/pyproject.toml
@@ -48,7 +48,7 @@ cartesia = [ "cartesia~=2.0.3", "websockets~=13.1" ]
 cerebras = []
 deepseek = []
 daily = [ "daily-python~=0.19.0" ]
-deepgram = [ "deepgram-sdk~=3.8.0" ]
+deepgram = [ "deepgram-sdk~=4.1.0" ]
 elevenlabs = [ "websockets~=13.1" ]
 fal = [ "fal-client~=0.5.9" ]
 fireworks = []
diff --git a/src/pipecat/services/deepgram/stt.py b/src/pipecat/services/deepgram/stt.py
index 07cc6a9d2..a223da143 100644
--- a/src/pipecat/services/deepgram/stt.py
+++ b/src/pipecat/services/deepgram/stt.py
@@ -78,17 +78,19 @@ class DeepgramSTTService(STTService):
             vad_events=False,
         )
 
-        merged_options = default_options
+        merged_options = default_options.to_dict()
         if live_options:
-            merged_options = LiveOptions(**{**default_options.to_dict(), **live_options.to_dict()})
+            default_model = default_options.model
+            merged_options.update(live_options.to_dict())
+            # NOTE(aleix): Fixes an in deepgram-sdk where `model` is initialized
+            # to the string "None" instead of the value `None`.
+            if "model" in merged_options and merged_options["model"] == "None":
+                merged_options["model"] = default_model
 
-        # deepgram connection requires language to be a string
-        if isinstance(merged_options.language, Language) and hasattr(
-            merged_options.language, "value"
-        ):
-            merged_options.language = merged_options.language.value
+        if "language" in merged_options and isinstance(merged_options["language"], Language):
+            merged_options["language"] = merged_options["language"].value
 
-        self._settings = merged_options.to_dict()
+        self._settings = merged_options
         self._addons = addons
 
         self._client = DeepgramClient(