diff --git a/templates/next-image/src/app/api/edit-image/route.ts b/templates/next-image/src/app/api/edit-image/route.ts
index 11c52b38e..6743d651e 100644
--- a/templates/next-image/src/app/api/edit-image/route.ts
+++ b/templates/next-image/src/app/api/edit-image/route.ts
@@ -17,13 +17,7 @@ const providers = {
   gemini: handleGoogleEdit,
 };
 
-export const config = {
-  api: {
-    bodyParser: {
-      sizeLimit: '4mb',
-    },
-  },
-};
+export const maxDuration = 60;
 
 export async function POST(req: Request) {
   try {
diff --git a/templates/next-image/src/app/api/generate-image/route.ts b/templates/next-image/src/app/api/generate-image/route.ts
index 15bf30c3a..372ba0584 100644
--- a/templates/next-image/src/app/api/generate-image/route.ts
+++ b/templates/next-image/src/app/api/generate-image/route.ts
@@ -19,13 +19,7 @@ const providers = {
   gemini: handleGoogleGenerate,
 };
 
-export const config = {
-  api: {
-    bodyParser: {
-      sizeLimit: '4mb',
-    },
-  },
-};
+export const maxDuration = 60;
 
 export async function POST(req: Request) {
   try {
diff --git a/templates/next-image/src/components/image-generator.tsx b/templates/next-image/src/components/image-generator.tsx
index e585d3cc5..b3f6c09d9 100644
--- a/templates/next-image/src/components/image-generator.tsx
+++ b/templates/next-image/src/components/image-generator.tsx
@@ -25,7 +25,7 @@ import { Button } from '@/components/ui/button';
 import { X } from 'lucide-react';
 import { useCallback, useEffect, useRef, useState } from 'react';
 
-import { fileToDataUrl } from '@/lib/image-utils';
+import { fileToDataUrl, resizeImageFile } from '@/lib/image-utils';
 import type {
   EditImageRequest,
   GeneratedImage,
@@ -219,12 +219,14 @@ export default function ImageGenerator() {
           try {
             const imageUrls = await Promise.all(
               imageFiles.map(async imageFile => {
-                // Convert blob URL to data URL for API
+                // Convert blob URL to resized data URL for API
+                // Resizing prevents 413 Request Entity Too Large errors
                 const response = await fetch(imageFile.url);
                 const blob = await response.blob();
-                return await fileToDataUrl(
-                  new File([blob], 'image', { type: imageFile.mediaType })
-                );
+                const file = new File([blob], 'image', {
+                  type: imageFile.mediaType,
+                });
+                return await resizeImageFile(file);
               })
             );
 
diff --git a/templates/next-image/src/lib/image-utils.ts b/templates/next-image/src/lib/image-utils.ts
index cefb219f3..84e814371 100644
--- a/templates/next-image/src/lib/image-utils.ts
+++ b/templates/next-image/src/lib/image-utils.ts
@@ -4,6 +4,12 @@
  * Simple, clean API with just data URLs. No complex conversions.
  */
 
+/**
+ * Maximum dimension (width or height) for resized images before upload.
+ * Prevents 413 Request Entity Too Large errors on serverless functions.
+ */
+const MAX_RESIZE_DIMENSION = 1024;
+
 /**
  * Converts a File to a data URL
  */
@@ -16,6 +22,64 @@ export async function fileToDataUrl(file: File): Promise<string> {
   });
 }
 
+/**
+ * Resizes an image File to fit within MAX_RESIZE_DIMENSION while preserving aspect ratio.
+ * Returns a JPEG data URL for smaller payload sizes.
+ * If the image is already small enough, returns the original data URL unchanged.
+ */
+export async function resizeImageFile(file: File): Promise<string> {
+  return new Promise((resolve, reject) => {
+    const img = new Image();
+    const url = URL.createObjectURL(file);
+
+    img.onload = () => {
+      URL.revokeObjectURL(url);
+
+      let { width, height } = img;
+
+      // If already within limits, just convert to data URL as-is
+      if (width <= MAX_RESIZE_DIMENSION && height <= MAX_RESIZE_DIMENSION) {
+        const canvas = document.createElement('canvas');
+        canvas.width = width;
+        canvas.height = height;
+        const ctx = canvas.getContext('2d');
+        if (!ctx) {
+          reject(new Error('Failed to get canvas context'));
+          return;
+        }
+        ctx.drawImage(img, 0, 0);
+        resolve(canvas.toDataURL('image/jpeg', 0.9));
+        return;
+      }
+
+      // Scale down preserving aspect ratio
+      const scale = MAX_RESIZE_DIMENSION / Math.max(width, height);
+      width = Math.round(width * scale);
+      height = Math.round(height * scale);
+
+      const canvas = document.createElement('canvas');
+      canvas.width = width;
+      canvas.height = height;
+      const ctx = canvas.getContext('2d');
+      if (!ctx) {
+        reject(new Error('Failed to get canvas context'));
+        return;
+      }
+
+      ctx.drawImage(img, 0, 0, width, height);
+      // Use JPEG at 90% quality for smaller payload
+      resolve(canvas.toDataURL('image/jpeg', 0.9));
+    };
+
+    img.onerror = () => {
+      URL.revokeObjectURL(url);
+      reject(new Error('Failed to load image for resizing'));
+    };
+
+    img.src = url;
+  });
+}
+
 /**
  * Converts a data URL to a File object
  */