diff --git a/.coveragerc b/.coveragerc
index 1190ab96c730..e2bc8347b10a 100644
--- a/.coveragerc
+++ b/.coveragerc
@@ -1,6 +1,5 @@
 [run]
 branch = true
-# relative_files = true # does not work?
 
 source =
     cvat/apps/
diff --git a/.github/codecov.yml b/.github/codecov.yml
new file mode 100644
index 000000000000..31402461a072
--- /dev/null
+++ b/.github/codecov.yml
@@ -0,0 +1,21 @@
+comment:
+  layout: "header, diff, components"
+
+component_management:
+  individual_components:
+    - component_id: cvat-ui
+      name: cvat-ui
+      paths:
+        - cvat-canvas/**
+        - cvat-canvas3d/**
+        - cvat-core/**
+        - cvat-data/**
+        - cvat-ui/**
+    - component_id: cvat-server
+      name: cvat-server
+      paths:
+        - cvat/**
+        - cvat-cli/**
+        - cvat-sdk/**
+        - utils/**
+
diff --git a/.github/workflows/full.yml b/.github/workflows/full.yml
index 8ff4d2fb2a3b..5faf726e3676 100644
--- a/.github/workflows/full.yml
+++ b/.github/workflows/full.yml
@@ -52,12 +52,19 @@ jobs:
       - name: CVAT server. Build and push
         uses: docker/build-push-action@v3
         with:
+          build-args: |
+              "COVERAGE_PROCESS_START=.coveragerc"
           cache-from: type=local,src=/tmp/cvat_cache_server
           context: .
           file: Dockerfile
           tags: cvat/server
           outputs: type=docker,dest=/tmp/cvat_server/image.tar
 
+      - name: Instrumentation of the code then rebuilding the CVAT UI
+        run: |
+          yarn --frozen-lockfile
+          yarn run coverage
+
       - name: CVAT UI. Build and push
         uses: docker/build-push-action@v3
         with:
@@ -154,11 +161,20 @@ jobs:
 
       - name: Running REST API and SDK tests
         id: run_tests
+        env:
+          COVERAGE_PROCESS_START: ".coveragerc"
         run: |
-          pip3 install --user '/tmp/cvat_sdk/[pytorch]'
-          pip3 install --user cvat-cli/
-          pip3 install --user -r tests/python/requirements.txt
-          pytest tests/python/ -s -v
+          pip3 install -r cvat-sdk/gen/requirements.txt
+          ./cvat-sdk/gen/generate.sh
+
+          pip3 install -r ./tests/python/requirements.txt
+          pip3 install -e ./cvat-sdk
+          pip3 install -e ./cvat-cli
+
+          pytest tests/python/ --cov --cov-report xml
+
+      - name: Upload coverage reports to Codecov with GitHub Action
+        uses: codecov/codecov-action@v3
 
       - name: Creating a log file from cvat containers
         if: failure() && steps.run_tests.conclusion == 'failure'
@@ -218,10 +234,13 @@ jobs:
           while [[  $(curl -s -o /dev/null -w "%{http_code}" localhost:8181/health?bundles) != "200" && max_tries -gt 0 ]]; do (( max_tries-- )); sleep 5; done
 
           docker compose -f docker-compose.yml -f docker-compose.dev.yml -f docker-compose.ci.yml run cvat_ci /bin/bash \
-            -c 'python manage.py test cvat/apps -v 2'
+            -c 'coverage run -a manage.py test cvat/apps && coverage json && mv coverage.json ${CONTAINER_COVERAGE_DATA_DIR}'
 
           docker compose -f docker-compose.yml -f docker-compose.dev.yml -f docker-compose.ci.yml run cvat_ci /bin/bash \
-            -c 'yarn --frozen-lockfile --ignore-scripts && yarn workspace cvat-core run test'
+            -c 'yarn --frozen-lockfile --ignore-scripts && yarn workspace cvat-core run test && mv cvat-core/reports/coverage/coverage-final.json ${CONTAINER_COVERAGE_DATA_DIR}'
+
+      - name: Upload coverage reports to Codecov with GitHub Action
+        uses: codecov/codecov-action@v3
 
       - name: Creating a log file from cvat containers
         if: failure()
@@ -317,16 +336,17 @@ jobs:
             npx cypress run \
               --headed \
               --browser chrome \
-              --env coverage=false \
               --config-file cypress_canvas3d.config.js \
               --spec 'cypress/e2e/${{ matrix.specs }}/**/*.js,cypress/e2e/remove_users_tasks_projects_organizations.js'
           else
             npx cypress run \
               --browser chrome \
-              --env coverage=false \
               --spec 'cypress/e2e/${{ matrix.specs }}/**/*.js,cypress/e2e/remove_users_tasks_projects_organizations.js'
           fi
 
+      - name: Upload coverage reports to Codecov with GitHub Action
+        uses: codecov/codecov-action@v3
+
       - name: Creating a log file from "cvat" container logs
         if: failure()
         run: |
diff --git a/.github/workflows/main.yml b/.github/workflows/main.yml
index 71d0412a8514..63a94f25440e 100644
--- a/.github/workflows/main.yml
+++ b/.github/workflows/main.yml
@@ -52,12 +52,19 @@ jobs:
       - name: CVAT server. Build and push
         uses: docker/build-push-action@v3
         with:
+          build-args: |
+              "COVERAGE_PROCESS_START=.coveragerc"
           cache-from: type=local,src=/tmp/cvat_cache_server
           context: .
           file: Dockerfile
           tags: cvat/server
           outputs: type=docker,dest=/tmp/cvat_server/image.tar
 
+      - name: Instrumentation of the code then rebuilding the CVAT UI
+        run: |
+          yarn --frozen-lockfile
+          yarn run coverage
+
       - name: CVAT UI. Build and push
         uses: docker/build-push-action@v3
         with:
@@ -130,12 +137,6 @@ jobs:
           name: cvat_ui
           path: /tmp/cvat_ui/
 
-      - name: Download CVAT SDK package
-        uses: actions/download-artifact@v3
-        with:
-          name: cvat_sdk
-          path: /tmp/cvat_sdk/
-
       - name: Load Docker images
         run: |
           docker load --input /tmp/cvat_server/image.tar
@@ -144,7 +145,6 @@ jobs:
           docker tag cvat/ui:latest cvat/ui:${CVAT_VERSION}
           docker image ls -a
 
-
       - name: Upload expected schema as an artifact
         if: failure() && steps.verify_schema.conclusion == 'failure'
         uses: actions/upload-artifact@v3.1.2
@@ -154,11 +154,20 @@ jobs:
 
       - name: Running REST API and SDK tests
         id: run_tests
+        env:
+          COVERAGE_PROCESS_START: ".coveragerc"
         run: |
-          pip3 install --user '/tmp/cvat_sdk/[pytorch]'
-          pip3 install --user cvat-cli/
-          pip3 install --user -r tests/python/requirements.txt
-          pytest tests/python/ -s -v
+          pip3 install -r cvat-sdk/gen/requirements.txt
+          ./cvat-sdk/gen/generate.sh
+
+          pip3 install -r ./tests/python/requirements.txt
+          pip3 install -e ./cvat-sdk
+          pip3 install -e ./cvat-cli
+
+          pytest tests/python/ --cov --cov-report xml
+
+      - name: Upload coverage reports to Codecov with GitHub Action
+        uses: codecov/codecov-action@v3
 
       - name: Creating a log file from cvat containers
         if: failure() && steps.run_tests.conclusion == 'failure'
@@ -216,10 +225,13 @@ jobs:
           while [[  $(curl -s -o /dev/null -w "%{http_code}" localhost:8181/health?bundles) != "200" && max_tries -gt 0 ]]; do (( max_tries-- )); sleep 5; done
 
           docker compose -f docker-compose.yml -f docker-compose.dev.yml -f docker-compose.ci.yml run cvat_ci /bin/bash \
-            -c 'python manage.py test cvat/apps -v 2'
+            -c 'coverage run -a manage.py test cvat/apps && coverage json && mv coverage.json ${CONTAINER_COVERAGE_DATA_DIR}'
 
           docker compose -f docker-compose.yml -f docker-compose.dev.yml -f docker-compose.ci.yml run cvat_ci /bin/bash \
-            -c 'yarn --frozen-lockfile --ignore-scripts && yarn workspace cvat-core run test'
+            -c 'yarn --frozen-lockfile --ignore-scripts && yarn workspace cvat-core run test && mv cvat-core/reports/coverage/coverage-final.json ${CONTAINER_COVERAGE_DATA_DIR}'
+
+      - name: Upload coverage reports to Codecov with GitHub Action
+        uses: codecov/codecov-action@v3
 
       - name: Creating a log file from cvat containers
         if: failure()
@@ -313,16 +325,17 @@ jobs:
             npx cypress run \
               --headed \
               --browser chrome \
-              --env coverage=false \
               --config-file cypress_canvas3d.config.js \
               --spec 'cypress/e2e/${{ matrix.specs }}/**/*.js,cypress/e2e/remove_users_tasks_projects_organizations.js'
           else
             npx cypress run \
               --browser chrome \
-              --env coverage=false \
               --spec 'cypress/e2e/${{ matrix.specs }}/**/*.js,cypress/e2e/remove_users_tasks_projects_organizations.js'
           fi
 
+      - name: Upload coverage reports to Codecov with GitHub Action
+        uses: codecov/codecov-action@v3
+
       - name: Creating a log file from "cvat" container logs
         if: failure()
         run: |
diff --git a/.github/workflows/schedule.yml b/.github/workflows/schedule.yml
index 097c1b5cc034..ab7297b56011 100644
--- a/.github/workflows/schedule.yml
+++ b/.github/workflows/schedule.yml
@@ -88,6 +88,8 @@ jobs:
       - name: CVAT server. Build and push
         uses: docker/build-push-action@v3
         with:
+          build-args: |
+              "COVERAGE_PROCESS_START=.coveragerc"
           cache-from: type=local,src=/tmp/cvat_cache_server
           context: .
           file: Dockerfile
@@ -163,14 +165,17 @@ jobs:
           ./opa test cvat/apps/iam/rules
 
       - name: REST API and SDK tests
+        env:
+          COVERAGE_PROCESS_START: ".coveragerc"
         run: |
-          pip3 install --user -r cvat-sdk/gen/requirements.txt
+          pip3 install -r cvat-sdk/gen/requirements.txt
           ./cvat-sdk/gen/generate.sh
 
-          pip3 install --user 'cvat-sdk/[pytorch]'
-          pip3 install --user cvat-cli/
-          pip3 install --user -r tests/python/requirements.txt
-          pytest tests/python/
+          pip3 install -r ./tests/python/requirements.txt
+          pip3 install -e ./cvat-sdk
+          pip3 install -e ./cvat-cli
+
+          pytest tests/python/ --cov --cov-report xml
           pytest tests/python/ --stop-services
 
       - name: Unit tests
@@ -183,20 +188,15 @@ jobs:
           while [[  $(curl -s -o /dev/null -w "%{http_code}" localhost:8181/health?bundles) != "200" && max_tries -gt 0 ]]; do (( max_tries-- )); sleep 5; done
 
           docker compose -f docker-compose.yml -f docker-compose.dev.yml -f docker-compose.ci.yml run cvat_ci /bin/bash \
-          -c 'coverage run -a manage.py test cvat/apps && mv .coverage ${CONTAINER_COVERAGE_DATA_DIR}'
+            -c 'coverage run -a manage.py test cvat/apps && coverage json && mv coverage.json ${CONTAINER_COVERAGE_DATA_DIR}'
 
           docker compose -f docker-compose.yml -f docker-compose.dev.yml -f docker-compose.ci.yml run cvat_ci /bin/bash \
-          -c 'yarn --frozen-lockfile --ignore-scripts && yarn workspace cvat-core run test'
+            -c 'yarn --frozen-lockfile --ignore-scripts && yarn workspace cvat-core run test && mv cvat-core/reports/coverage/coverage-final.json ${CONTAINER_COVERAGE_DATA_DIR}'
 
           docker compose -f docker-compose.yml -f docker-compose.dev.yml -f docker-compose.ci.yml down -v
 
-      - name: Uploading code coverage results as an artifact
-        uses: actions/upload-artifact@v3.1.1
-        with:
-          name: coverage_results
-          path: |
-            ${{ github.workspace }}/lcov.info
-            ${{ github.workspace }}/.coverage
+      - name: Upload coverage reports to Codecov with GitHub Action
+        uses: codecov/codecov-action@v3
 
   e2e_testing:
     needs: build
@@ -304,14 +304,15 @@ jobs:
               --browser chrome \
               --config-file cypress_canvas3d.config.js \
               --spec 'cypress/e2e/${{ matrix.specs }}/**/*.js,cypress/e2e/remove_users_tasks_projects_organizations.js'
-            mv ./.nyc_output/out.json ./.nyc_output/out_${{ matrix.specs }}.json
           else
             npx cypress run \
               --browser chrome \
               --spec 'cypress/e2e/${{ matrix.specs }}/**/*.js,cypress/e2e/remove_users_tasks_projects_organizations.js'
-            mv ./.nyc_output/out.json ./.nyc_output/out_${{ matrix.specs }}.json
           fi
 
+      - name: Upload coverage reports to Codecov with GitHub Action
+        uses: codecov/codecov-action@v3
+
       - name: Creating a log file from "cvat" container logs
         if: failure()
         run: |
@@ -330,72 +331,3 @@ jobs:
         with:
           name: cvat_container_logs
           path: ${{ github.workspace }}/tests/cvat.log
-
-      - name: Uploading code coverage results as an artifact
-        uses: actions/upload-artifact@v3.1.1
-        with:
-          name: coverage_results
-          path: ${{ github.workspace }}/tests/.nyc_output
-
-  coveralls:
-    runs-on: ubuntu-latest
-    needs: [unit_testing, e2e_testing]
-    steps:
-      - uses: actions/checkout@v3
-
-      - name: CVAT server. Extract metadata (tags, labels) for Docker
-        id: meta-server
-        uses: docker/metadata-action@master
-        with:
-          images: ${{ secrets.DOCKERHUB_CI_WORKSPACE }}/${{ env.SERVER_IMAGE_TEST_REPO }}
-          tags:
-            type=raw,value=nightly
-
-      - name: Login to Docker Hub
-        uses: docker/login-action@v2
-        with:
-          username: ${{ secrets.DOCKERHUB_CI_USERNAME }}
-          password: ${{ secrets.DOCKERHUB_CI_TOKEN }}
-
-      - name: Pull CVAT server image
-        run: |
-          docker pull ${{ steps.meta-server.outputs.tags }}
-          docker tag ${{ steps.meta-server.outputs.tags }} cvat/server:local
-
-      - name: Downloading coverage results
-        uses: actions/download-artifact@v2
-        with:
-          name: coverage_results
-
-      - name: Combining coverage results
-        run: |
-          mkdir -p ./nyc_output_tmp
-          mv ./out_*.json ./nyc_output_tmp
-          mkdir -p ./.nyc_output
-          yarn --frozen-lockfile
-          npx nyc merge ./nyc_output_tmp ./.nyc_output/out.json
-
-      - name: Sending results to Coveralls
-        env:
-          HOST_COVERAGE_DATA_DIR: ${{ github.workspace }}
-          CONTAINER_COVERAGE_DATA_DIR: "/coverage_data"
-          COVERALLS_SERVICE_NAME: github
-          GITHUB_TOKEN: ${{ secrets.GITHUB_TOKEN }}
-        run: |
-            npx nyc report --reporter=text-lcov >> ${HOST_COVERAGE_DATA_DIR}/lcov.info
-
-            docker compose \
-              -f docker-compose.yml \
-              -f docker-compose.dev.yml \
-              -f docker-compose.ci.yml \
-              run cvat_ci /bin/bash -c 'cd ${CONTAINER_COVERAGE_DATA_DIR} && coveralls-lcov -v -n lcov.info > ${CONTAINER_COVERAGE_DATA_DIR}/coverage.json'
-
-            docker compose \
-              -f docker-compose.yml \
-              -f docker-compose.dev.yml \
-              -f docker-compose.ci.yml \
-              run cvat_ci /bin/bash -c '\
-                ln -s ${CONTAINER_COVERAGE_DATA_DIR}/.git . \
-                && ln -s ${CONTAINER_COVERAGE_DATA_DIR}/.coverage . \
-                && ln -s ${CONTAINER_COVERAGE_DATA_DIR}/coverage.json . \
-                && coveralls --merge=coverage.json'
diff --git a/Dockerfile b/Dockerfile
index 974aab6eb888..855aa61de5ba 100644
--- a/Dockerfile
+++ b/Dockerfile
@@ -178,6 +178,11 @@ COPY --chown=${USER} wait-for-it.sh manage.py backend_entrypoint.sh ${HOME}/
 COPY --chown=${USER} utils/ ${HOME}/utils
 COPY --chown=${USER} cvat/ ${HOME}/cvat
 
+ARG COVERAGE_PROCESS_START
+RUN if [ "${COVERAGE_PROCESS_START}" ]; then \
+        echo "import coverage; coverage.process_startup()" > /opt/venv/lib/python3.10/site-packages/coverage_subprocess.pth; \
+    fi
+
 # RUN all commands below as 'django' user
 USER ${USER}
 WORKDIR ${HOME}
diff --git a/Dockerfile.ci b/Dockerfile.ci
index 1dd4b0c279c0..0438e80bdcc6 100644
--- a/Dockerfile.ci
+++ b/Dockerfile.ci
@@ -25,9 +25,7 @@ RUN apt-get update && \
 COPY cvat/requirements/ /tmp/cvat/requirements/
 COPY utils/dataset_manifest/requirements.txt /tmp/utils/dataset_manifest/requirements.txt
 
-RUN DATUMARO_HEADLESS=1 python3 -m pip install --no-cache-dir -r /tmp/cvat/requirements/${DJANGO_CONFIGURATION}.txt && \
-    python3 -m pip install --no-cache-dir coveralls
-RUN gem install coveralls-lcov
+RUN DATUMARO_HEADLESS=1 python3 -m pip install --no-cache-dir -r /tmp/cvat/requirements/${DJANGO_CONFIGURATION}.txt
 
 COPY cvat-core ${HOME}/cvat-core
 COPY cvat-data ${HOME}/cvat-data
diff --git a/README.md b/README.md
index b038ba67d35c..1b99a09ebe80 100644
--- a/README.md
+++ b/README.md
@@ -256,8 +256,8 @@ questions and get our support.
 [ci-url]: https://github.com/opencv/cvat/actions
 [gitter-img]: https://img.shields.io/gitter/room/opencv-cvat/public?style=flat
 [gitter-url]: https://gitter.im/opencv-cvat
-[coverage-img]: https://coveralls.io/repos/github/cvat-ai/cvat/badge.svg?branch=develop
-[coverage-url]: https://coveralls.io/github/cvat-ai/cvat?branch=develop
+[coverage-img]: https://codecov.io/github/opencv/cvat/branch/develop/graph/badge.svg
+[coverage-url]: https://codecov.io/github/opencv/cvat
 [doi-img]: https://zenodo.org/badge/139156354.svg
 [doi-url]: https://zenodo.org/badge/latestdoi/139156354
 [discord-img]: https://img.shields.io/discord/1000789942802337834?label=discord
diff --git a/cvat-core/package.json b/cvat-core/package.json
index 8f20feefc61f..4cd658b3df60 100644
--- a/cvat-core/package.json
+++ b/cvat-core/package.json
@@ -6,7 +6,6 @@
   "scripts": {
     "build": "webpack",
     "test": "jest --config=jest.config.js --coverage",
-    "coveralls": "cat ./reports/coverage/lcov.info | coveralls",
     "type-check": "tsc --noEmit",
     "type-check:watch": "yarn run type-check --watch"
   },
@@ -19,7 +18,6 @@
     "> 2%"
   ],
   "devDependencies": {
-    "coveralls": "^3.0.5",
     "jest": "^29.5.0",
     "jest-config": "^29.5.0",
     "jest-environment-jsdom": "^29.5.0",
diff --git a/cvat/requirements/production.in b/cvat/requirements/production.in
index 530545b6a4c0..c349f996c947 100644
--- a/cvat/requirements/production.in
+++ b/cvat/requirements/production.in
@@ -1,2 +1,4 @@
 -r base.in
 uvicorn[standard]==0.22.0
+coverage==7.2.3 # to collect the coverage for REST API tests.
+# It will be enabled only if COVERAGE_PROCESS_START env is defined.
diff --git a/cvat/requirements/production.txt b/cvat/requirements/production.txt
index a142cfdc6af2..3899e8286174 100644
--- a/cvat/requirements/production.txt
+++ b/cvat/requirements/production.txt
@@ -26,5 +26,7 @@ watchfiles==0.19.0
     # via uvicorn
 websockets==11.0.3
     # via uvicorn
+coverage==7.2.3
+    # via -r cvat/requirements/production.in
 
 # The following packages are considered to be unsafe in a requirements file:
diff --git a/cvat/requirements/testing.in b/cvat/requirements/testing.in
index ff5ff5ca91dd..e2c70b149ea2 100644
--- a/cvat/requirements/testing.in
+++ b/cvat/requirements/testing.in
@@ -1,3 +1,3 @@
 -r development.in
-coveralls
 fakeredis==2.10.3
+coverage==7.2.3
diff --git a/cvat/requirements/testing.txt b/cvat/requirements/testing.txt
index 6de652fc0d2a..a868cb1c6b0c 100644
--- a/cvat/requirements/testing.txt
+++ b/cvat/requirements/testing.txt
@@ -1,4 +1,4 @@
-# SHA1:8dec2a1cde7e68bd79ee31cdec270084f7e3266b
+# SHA1:910e8edd8fcfdbe7c9a7278ba499bcfad1313c19
 #
 # This file is autogenerated by pip-compile-multi
 # To update, run:
@@ -8,15 +8,11 @@
 -r development.txt
 --no-binary av
 
-coverage==6.5.0
-    # via coveralls
-coveralls==3.3.1
-    # via -r cvat/requirements/testing.in
-docopt==0.6.2
-    # via coveralls
 fakeredis==2.10.3
     # via -r cvat/requirements/testing.in
 sortedcontainers==2.4.0
     # via fakeredis
+coverage==7.2.3
+    # via -r cvat/requirements/testing.in
 
 # The following packages are considered to be unsafe in a requirements file:
diff --git a/cvat/rqworker.py b/cvat/rqworker.py
index 2d68a419f95b..78319ff2e841 100644
--- a/cvat/rqworker.py
+++ b/cvat/rqworker.py
@@ -1,8 +1,10 @@
 # Copyright (C) 2018-2022 Intel Corporation
-# Copyright (C) 2022 CVAT.ai Corporation
+# Copyright (C) 2022-2023 CVAT.ai Corporation
 #
 # SPDX-License-Identifier: MIT
 
+import os
+
 from rq import Worker
 
 import cvat.utils.remote_debugger as debug
@@ -62,3 +64,15 @@ def execute_job(self, *args, **kwargs):
             return super().execute_job(*args, **kwargs)
 
     DefaultWorker = RemoteDebugWorker
+
+
+if os.environ.get("COVERAGE_PROCESS_START"):
+    import coverage
+
+    def coverage_exit():
+        cov = coverage.Coverage.current()
+        cov.stop()
+        cov.save()
+        os._exit(0)
+
+    os._exit = coverage_exit
diff --git a/docker-compose.ci.yml b/docker-compose.ci.yml
index bc1628548c77..177d40011498 100644
--- a/docker-compose.ci.yml
+++ b/docker-compose.ci.yml
@@ -14,7 +14,6 @@ services:
     depends_on:
       - cvat_server
     environment:
-      COVERALLS_SERVICE_NAME:
       CONTAINER_COVERAGE_DATA_DIR:
       GITHUB_ACTIONS:
       GITHUB_TOKEN:
diff --git a/docker-compose.dev.yml b/docker-compose.dev.yml
index 03a16b43b138..01d8d2f6bcb6 100644
--- a/docker-compose.dev.yml
+++ b/docker-compose.dev.yml
@@ -19,11 +19,13 @@ services:
         socks_proxy:
         CLAM_AV:
         CVAT_DEBUG_ENABLED:
+        COVERAGE_PROCESS_START:
     environment:
       CVAT_DEBUG_ENABLED: '${CVAT_DEBUG_ENABLED:-no}'
       CVAT_DEBUG_PORT: '9090'
       # If 'yes', wait for a debugger connection on startup
       CVAT_DEBUG_WAIT: '${CVAT_DEBUG_WAIT_CLIENT:-no}'
+      COVERAGE_PROCESS_START:
     ports:
       - '9090:9090'
 
@@ -35,6 +37,7 @@ services:
       # NUMPROCS: 1
       CVAT_DEBUG_ENABLED: '${CVAT_DEBUG_ENABLED:-no}'
       CVAT_DEBUG_PORT: '9092'
+      COVERAGE_PROCESS_START:
     ports:
       - '9092:9092'
 
@@ -46,6 +49,7 @@ services:
       # NUMPROCS: 1
       CVAT_DEBUG_ENABLED: '${CVAT_DEBUG_ENABLED:-no}'
       CVAT_DEBUG_PORT: '9093'
+      COVERAGE_PROCESS_START:
     ports:
       - '9093:9093'
 
@@ -57,6 +61,7 @@ services:
       # NUMPROCS: 1
       CVAT_DEBUG_ENABLED: '${CVAT_DEBUG_ENABLED:-no}'
       CVAT_DEBUG_PORT: '9091'
+      COVERAGE_PROCESS_START:
     ports:
       - '9091:9091'
 
diff --git a/package.json b/package.json
index 6cf2be82717c..14efb012c4ae 100644
--- a/package.json
+++ b/package.json
@@ -35,7 +35,6 @@
     "babel-register": "^6.26.0",
     "bundle-declarations-webpack-plugin": "^3.1.0",
     "copy-webpack-plugin": "^11.0.0",
-    "coveralls": "^3.1.0",
     "css-loader": "^3.4.2",
     "eslint": "^7.11.0",
     "eslint-config-airbnb": "^18.0.1",
@@ -89,9 +88,9 @@
   "scripts": {
     "test": "echo \"Error: no test specified\" && exit 1",
     "coverage": "yarn run instrument && yarn run cp && yarn run rm",
-    "instrument": "nyc instrument cvat-ui cvat-ui_cov && nyc instrument cvat-canvas cvat-canvas_cov && nyc instrument cvat-data cvat-data_cov && nyc instrument cvat-core cvat-core_cov",
-    "cp": "cp -r cvat-ui_cov/* cvat-ui && cp -r cvat-canvas_cov/* cvat-canvas && cp -r cvat-data_cov/* cvat-data && cp -r cvat-core_cov/* cvat-core",
-    "rm": "rm -rf cvat-ui_cov cvat-canvas_cov cvat-data_cov cvat-core_cov",
+    "instrument": "nyc instrument cvat-ui cvat-ui_cov && nyc instrument cvat-canvas cvat-canvas_cov && nyc instrument cvat-canvas3d cvat-canvas3d_cov && nyc instrument cvat-data cvat-data_cov && nyc instrument cvat-core cvat-core_cov",
+    "cp": "cp -r cvat-ui_cov/* cvat-ui && cp -r cvat-canvas_cov/* cvat-canvas && cp -r cvat-canvas3d_cov/* cvat-canvas3d && cp -r cvat-data_cov/* cvat-data && cp -r cvat-core_cov/* cvat-core",
+    "rm": "rm -rf cvat-ui_cov cvat-canvas_cov cvat-canvas3d_cov cvat-data_cov cvat-core_cov",
     "prepare": "husky install && rm .husky/pre-commit; npx husky add .husky/pre-commit \"npx lint-staged\"",
     "precommit:cvat-tests": "cd tests && eslint --fix",
     "precommit:cvat-data": "cd cvat-data && eslint --fix",
diff --git a/site/content/en/docs/contributing/running-tests.md b/site/content/en/docs/contributing/running-tests.md
index 0363f11e08ee..ccebc46640e7 100644
--- a/site/content/en/docs/contributing/running-tests.md
+++ b/site/content/en/docs/contributing/running-tests.md
@@ -29,6 +29,12 @@ description: 'Instructions on how to run all existence tests.'
    yarn --frozen-lockfile
    ```
 
+If you want to get a code coverage report, instrument the code:
+```
+yarn --frozen-lockfile
+yarn run coverage
+```
+
 **Running tests**
 
 ```
@@ -74,6 +80,11 @@ If you need to rebuild your CVAT images add `--rebuild` option:
 pytest ./tests/python --rebuild
 ```
 
+If you want to get a code coverage report, use special option for it:
+```
+COVERAGE_PROCESS_START=.coveragerc pytest ./tests/python --rebuild --cov --cov-report xml
+```
+
 **Debugging**
 
 Currently, this is only supported in deployments based on Docker Compose,
@@ -146,6 +157,12 @@ Extra options:
    ```
    python manage.py test --settings cvat.settings.testing cvat/apps -v 2
    ```
+
+If you want to get a code coverage report, run the next command:
+   ```
+   coverage run manage.py test --settings cvat.settings.testing cvat/apps -v 2
+   ```
+
 1. JS tests
    ```
    cd cvat-core
diff --git a/tests/python/.coveragerc b/tests/python/.coveragerc
new file mode 100644
index 000000000000..2e17038a15d0
--- /dev/null
+++ b/tests/python/.coveragerc
@@ -0,0 +1,40 @@
+[run]
+branch = true
+parallel = true
+sigterm = true
+concurrency=thread
+
+source =
+    cvat/apps/
+    cvat-sdk/
+    cvat-cli/
+    utils/dataset_manifest
+
+omit =
+    cvat/settings/*
+    */tests/*
+    */test_*
+    */_test_*
+    */migrations/*
+
+[report]
+exclude_lines =
+    # Have to re-enable the standard pragma
+    pragma: no cover
+
+    # Don't complain about missing debug-only code:
+    def __repr__
+    if\s+[\w\.()]+\.isEnabledFor\(log\.DEBUG\):
+
+    # Don't complain if tests don't hit defensive assertion code:
+    raise AssertionError
+    raise NotImplementedError
+
+    # Don't complain if non-runnable code isn't run:
+    if 0:
+    if __name__ == .__main__.:
+
+# don't fail on the code that can be found
+ignore_errors = true
+
+skip_empty = true
diff --git a/tests/python/requirements.txt b/tests/python/requirements.txt
index 89af8413f6be..b41295b04a42 100644
--- a/tests/python/requirements.txt
+++ b/tests/python/requirements.txt
@@ -1,6 +1,7 @@
 pytest==6.2.5
 pytest-cases==3.6.13
 pytest-timeout==2.1.0
+pytest-cov==4.0.0
 requests==2.31.0
 deepdiff==5.6.0
 boto3==1.17.61
diff --git a/tests/python/rest_api/test_tasks.py b/tests/python/rest_api/test_tasks.py
index 9300dafd2731..56e5478223fe 100644
--- a/tests/python/rest_api/test_tasks.py
+++ b/tests/python/rest_api/test_tasks.py
@@ -1780,7 +1780,7 @@ def _delete_annotations(self, task_id):
             (_, response) = api_client.tasks_api.destroy_annotations(id=task_id)
             assert response.status == HTTPStatus.NO_CONTENT
 
-    @pytest.mark.timeout(64)
+    @pytest.mark.timeout(70)
     @pytest.mark.parametrize("successful_upload", [True, False])
     def test_can_import_annotations_after_previous_unclear_import(
         self, successful_upload: bool, tasks_with_shapes
@@ -1815,7 +1815,7 @@ def test_can_import_annotations_after_previous_unclear_import(
             rq_id = json.loads(response.data)["rq_id"]
             assert rq_id
         else:
-            required_time = 54
+            required_time = 60
             uploader._tus_start_upload(url, query_params=params)
             uploader._upload_file_data_with_tus(
                 url, filename, meta=params, logger=self.client.logger.debug
@@ -1828,7 +1828,7 @@ def test_can_import_annotations_after_previous_unclear_import(
         task.import_annotations(self.format, filename)
         self._check_annotations(task_id)
 
-    @pytest.mark.timeout(64)
+    @pytest.mark.timeout(70)
     def test_check_import_cache_after_previous_interrupted_upload(self, tasks_with_shapes, request):
         task_id = tasks_with_shapes[0]["id"]
         with NamedTemporaryFile() as f:
diff --git a/tests/python/shared/fixtures/init.py b/tests/python/shared/fixtures/init.py
index 792fe36825f2..dd6d7aafdc43 100644
--- a/tests/python/shared/fixtures/init.py
+++ b/tests/python/shared/fixtures/init.py
@@ -1,9 +1,10 @@
-# Copyright (C) 2022 CVAT.ai Corporation
+# Copyright (C) 2022-2023 CVAT.ai Corporation
 #
 # SPDX-License-Identifier: MIT
 
 import logging
 import os
+from enum import Enum
 from http import HTTPStatus
 from pathlib import Path
 from subprocess import PIPE, CalledProcessError, run
@@ -32,6 +33,23 @@
 ] + CONTAINER_NAME_FILES
 
 
+class Container(str, Enum):
+    DB = "cvat_db"
+    SERVER = "cvat_server"
+    WORKER_ANNOTATION = "cvat_worker_annotation"
+    WORKER_IMPORT = "cvat_worker_import"
+    WORKER_EXPORT = "cvat_worker_export"
+    WORKER_WEBHOOKS = "cvat_worker_webhooks"
+    UTILS = "cvat_utils"
+
+    def __str__(self):
+        return self.value
+
+    @classmethod
+    def covered(cls):
+        return [item.value for item in cls if item != cls.DB]
+
+
 def pytest_addoption(parser):
     group = parser.getgroup("CVAT REST API testing options")
     group._addoption(
@@ -75,14 +93,13 @@ def pytest_addoption(parser):
 
 def _run(command, capture_output=True):
     _command = command.split() if isinstance(command, str) else command
-
     try:
         stdout, stderr = "", ""
         if capture_output:
             proc = run(_command, check=True, stdout=PIPE, stderr=PIPE)  # nosec
             stdout, stderr = proc.stdout.decode(), proc.stderr.decode()
         else:
-            proc = run(_command, check=True)  # nosec
+            proc = run(_command)  # nosec
         return stdout, stderr
     except CalledProcessError as exc:
         stderr = exc.stderr.decode() or exc.stdout.decode() if capture_output else "see above"
@@ -120,6 +137,10 @@ def kube_cp(source, target):
     _run(f"kubectl cp {source} {target}")
 
 
+def docker_exec(container, command, capture_output=True):
+    return _run(f"docker exec -u root {PREFIX}_{container}_1 {command}", capture_output)
+
+
 def docker_exec_cvat(command: Union[List[str], str]):
     base = f"docker exec {PREFIX}_cvat_server_1"
     _command = f"{base} {command}" if isinstance(command, str) else base.split() + command
@@ -133,10 +154,6 @@ def kube_exec_cvat(command: Union[List[str], str]):
     return _run(_command)
 
 
-def docker_exec_cvat_db(command):
-    _run(f"docker exec {PREFIX}_cvat_db_1 {command}")
-
-
 def kube_exec_cvat_db(command):
     pod_name = _kube_get_db_pod_name()
     _run(["kubectl", "exec", pod_name, "--"] + command)
@@ -152,7 +169,9 @@ def kube_exec_clickhouse_db(command):
 
 
 def docker_restore_db():
-    docker_exec_cvat_db("psql -U root -d postgres -v from=test_db -v to=cvat -f /tmp/restore.sql")
+    docker_exec(
+        Container.DB, "psql -U root -d postgres -v from=test_db -v to=cvat -f /tmp/restore.sql"
+    )
 
 
 def kube_restore_db():
@@ -215,10 +234,17 @@ def create_compose_files(container_name_files):
 
             for service_name, service_config in dc_config["services"].items():
                 service_config.pop("container_name", None)
-                if service_name in ("cvat_server", "cvat_utils"):
+                if service_name in (Container.SERVER, Container.UTILS):
                     service_env = service_config["environment"]
                     service_env["DJANGO_SETTINGS_MODULE"] = "cvat.settings.testing_rest"
 
+                if service_name in Container.covered():
+                    service_env = service_config["environment"]
+                    service_env["COVERAGE_PROCESS_START"] = ".coveragerc"
+                    service_config["volumes"].append(
+                        "./tests/python/.coveragerc:/home/django/.coveragerc"
+                    )
+
             yaml.dump(dc_config, ndcf)
 
 
@@ -252,7 +278,7 @@ def docker_restore_data_volumes():
         CVAT_DB_DIR / "cvat_data.tar.bz2",
         f"{PREFIX}_cvat_server_1:/tmp/cvat_data.tar.bz2",
     )
-    docker_exec_cvat("tar --strip 3 -xjf /tmp/cvat_data.tar.bz2 -C /home/django/data/")
+    docker_exec(Container.SERVER, "tar --strip 3 -xjf /tmp/cvat_data.tar.bz2 -C /home/django/data/")
 
 
 def kube_restore_data_volumes():
@@ -376,8 +402,10 @@ def local_start(start, stop, dumpdb, cleanup, rebuild, cvat_root_dir, cvat_db_di
     docker_cp(cvat_db_dir / "data.json", f"{PREFIX}_cvat_server_1:/tmp/data.json")
     wait_for_services()
 
-    docker_exec_cvat("python manage.py loaddata /tmp/data.json")
-    docker_exec_cvat_db("psql -U root -d postgres -v from=cvat -v to=test_db -f /tmp/restore.sql")
+    docker_exec(Container.SERVER, "python manage.py loaddata /tmp/data.json")
+    docker_exec(
+        Container.DB, "psql -U root -d postgres -v from=cvat -v to=test_db -f /tmp/restore.sql"
+    )
 
     if start:
         pytest.exit("All necessary containers have been created and started.", returncode=0)
@@ -408,18 +436,45 @@ def pytest_sessionstart(session: pytest.Session) -> None:
 
 
 def pytest_sessionfinish(session: pytest.Session, exitstatus: int) -> None:
+    session_finish(session)
+
+
+def session_finish(session):
     if session.config.getoption("--collect-only"):
         return
 
     platform = session.config.getoption("--platform")
 
     if platform == "local":
+        if os.environ.get("COVERAGE_PROCESS_START"):
+            collect_code_coverage_from_containers()
+
         docker_restore_db()
-        docker_exec_cvat_db("dropdb test_db")
+        docker_exec(Container.DB, "dropdb test_db")
+
+        docker_exec(Container.DB, "dropdb --if-exists cvat")
+        docker_exec(Container.DB, "createdb cvat")
+        docker_exec(Container.SERVER, "python manage.py migrate")
 
-        docker_exec_cvat_db("dropdb --if-exists cvat")
-        docker_exec_cvat_db("createdb cvat")
-        docker_exec_cvat("python manage.py migrate")
+
+def collect_code_coverage_from_containers():
+    for container in Container.covered():
+        process_command = "python3"
+
+        # find process with code coverage
+        pid, _ = docker_exec(container, f"pidof {process_command} -o 1")
+
+        # stop process with code coverage
+        docker_exec(container, f"kill -15 {pid}")
+        sleep(3)
+
+        # get code coverage report
+        docker_exec(container, "coverage combine", capture_output=False)
+        docker_exec(container, "coverage xml", capture_output=False)
+        docker_cp(
+            f"{PREFIX}_{container}_1:home/django/coverage.xml",
+            f"coverage_{container}.xml",
+        )
 
 
 @pytest.fixture(scope="function")
diff --git a/yarn.lock b/yarn.lock
index 18636dc1c78d..85117e4f1f9e 100644
--- a/yarn.lock
+++ b/yarn.lock
@@ -3733,17 +3733,6 @@ cosmiconfig@^7.0.0:
     path-type "^4.0.0"
     yaml "^1.10.0"
 
-coveralls@^3.0.5, coveralls@^3.1.0:
-  version "3.1.1"
-  resolved "https://registry.yarnpkg.com/coveralls/-/coveralls-3.1.1.tgz#f5d4431d8b5ae69c5079c8f8ca00d64ac77cf081"
-  integrity sha512-+dxnG2NHncSD1NrqbSM3dn/lE57O6Qf/koe9+I7c+wzkqRmEvcp0kgJdxKInzYzkICKkFMZsX3Vct3++tsF9ww==
-  dependencies:
-    js-yaml "^3.13.1"
-    lcov-parse "^1.0.0"
-    log-driver "^1.2.7"
-    minimist "^1.2.5"
-    request "^2.88.2"
-
 cross-spawn@^7.0.0, cross-spawn@^7.0.2, cross-spawn@^7.0.3:
   version "7.0.3"
   resolved "https://registry.yarnpkg.com/cross-spawn/-/cross-spawn-7.0.3.tgz#f73a85b9d5d41d045551c177e2882d4ac85728a6"