diff --git a/homeassistant/components/reolink/config_flow.py b/homeassistant/components/reolink/config_flow.py
index bf58646536f..102aeae575e 100644
--- a/homeassistant/components/reolink/config_flow.py
+++ b/homeassistant/components/reolink/config_flow.py
@@ -7,7 +7,12 @@ import logging
 from typing import Any
 
 from reolink_aio.api import ALLOWED_SPECIAL_CHARS
-from reolink_aio.exceptions import ApiError, CredentialsInvalidError, ReolinkError
+from reolink_aio.exceptions import (
+    ApiError,
+    CredentialsInvalidError,
+    LoginFirmwareError,
+    ReolinkError,
+)
 import voluptuous as vol
 
 from homeassistant.components import dhcp
@@ -233,6 +238,15 @@ class ReolinkFlowHandler(ConfigFlow, domain=DOMAIN):
                 placeholders["special_chars"] = ALLOWED_SPECIAL_CHARS
             except CredentialsInvalidError:
                 errors[CONF_PASSWORD] = "invalid_auth"
+            except LoginFirmwareError:
+                errors["base"] = "update_needed"
+                placeholders["current_firmware"] = host.api.sw_version
+                placeholders["needed_firmware"] = (
+                    host.api.sw_version_required.version_string
+                )
+                placeholders["download_center_url"] = (
+                    "https://reolink.com/download-center"
+                )
             except ApiError as err:
                 placeholders["error"] = str(err)
                 errors[CONF_HOST] = "api_error"
diff --git a/homeassistant/components/reolink/strings.json b/homeassistant/components/reolink/strings.json
index 4ec4dcffdfd..67fd5329e14 100644
--- a/homeassistant/components/reolink/strings.json
+++ b/homeassistant/components/reolink/strings.json
@@ -31,6 +31,7 @@
       "not_admin": "User needs to be admin, user \"{username}\" has authorisation level \"{userlevel}\"",
       "password_incompatible": "Password contains incompatible special character, only these characters are allowed: a-z, A-Z, 0-9 or {special_chars}",
       "unknown": "[%key:common::config_flow::error::unknown%]",
+      "update_needed": "Failed to login because of outdated firmware, please update the firmware to version {needed_firmware} using the Reolink Download Center: {download_center_url}, currently version {current_firmware} is installed",
       "webhook_exception": "Home Assistant URL is not available, go to Settings > System > Network > Home Assistant URL and correct the URLs, see {more_info}"
     },
     "abort": {
diff --git a/tests/components/reolink/test_config_flow.py b/tests/components/reolink/test_config_flow.py
index 9382d9f7901..bb896428b99 100644
--- a/tests/components/reolink/test_config_flow.py
+++ b/tests/components/reolink/test_config_flow.py
@@ -7,7 +7,12 @@ from unittest.mock import ANY, AsyncMock, MagicMock, call
 from aiohttp import ClientSession
 from freezegun.api import FrozenDateTimeFactory
 import pytest
-from reolink_aio.exceptions import ApiError, CredentialsInvalidError, ReolinkError
+from reolink_aio.exceptions import (
+    ApiError,
+    CredentialsInvalidError,
+    LoginFirmwareError,
+    ReolinkError,
+)
 
 from homeassistant import config_entries
 from homeassistant.components import dhcp
@@ -171,6 +176,20 @@ async def test_config_flow_errors(
     assert result["step_id"] == "user"
     assert result["errors"] == {CONF_PASSWORD: "invalid_auth"}
 
+    reolink_connect.get_host_data.side_effect = LoginFirmwareError("Test error")
+    result = await hass.config_entries.flow.async_configure(
+        result["flow_id"],
+        {
+            CONF_USERNAME: TEST_USERNAME,
+            CONF_PASSWORD: TEST_PASSWORD,
+            CONF_HOST: TEST_HOST,
+        },
+    )
+
+    assert result["type"] is FlowResultType.FORM
+    assert result["step_id"] == "user"
+    assert result["errors"] == {"base": "update_needed"}
+
     reolink_connect.valid_password.return_value = False
     result = await hass.config_entries.flow.async_configure(
         result["flow_id"],