diff --git a/sdk/identity/identity/CHANGELOG.md b/sdk/identity/identity/CHANGELOG.md
index 91f5ac8e1510..8023b36fe503 100644
--- a/sdk/identity/identity/CHANGELOG.md
+++ b/sdk/identity/identity/CHANGELOG.md
@@ -37,10 +37,9 @@ async function main() {
 
 #### New credentials
 
-Identity v2 includes three new credential types:
+Identity v2 includes two new credential types:
 
 - `AzurePowerShellCredential`, which re-uses any account previously authenticated with the `Az.Account` PowerShell module.
-- `AzureApplicationCredential`, which is a simplified `DefaultAzureCredential` that only includes `EnvironmentCredential` and `ManagedIdentityCredential`.
 - `OnBehalfOfCredential`, which enables the [On-Behalf-Of authentication flow](https://docs.microsoft.com/azure/active-directory/develop/v2-oauth2-on-behalf-of-flow).
 
 #### New features in all credentials
@@ -109,7 +108,7 @@ Azure Service Fabric support hasn't been added on the initial version 2 of Ident
 
 #### Breaking Changes from 2.0.0-beta.6
 
-- Renamed the `ApplicationCredential` to `AzureApplicationCredential`.
+- Stopped exporting the `ApplicationCredential` from the package. This will be re-introduced in the future.
 - Removed the `CredentialPersistenceOptions` from `DefaultAzureCredential` and `EnvironmentCredential`.
 - Merged the configuration and the options bag on the `OnBehalfOfCredential` into a single options bag.
 - `AuthenticationRequiredError` (introduced in 2.0.0-beta.1) now has its parameters into a single options bag.
diff --git a/sdk/identity/identity/review/identity.api.md b/sdk/identity/identity/review/identity.api.md
index 52145796d357..87bb5fbee2a6 100644
--- a/sdk/identity/identity/review/identity.api.md
+++ b/sdk/identity/identity/review/identity.api.md
@@ -62,16 +62,6 @@ export class AuthorizationCodeCredential implements TokenCredential {
     getToken(scopes: string | string[], options?: GetTokenOptions): Promise<AccessToken>;
 }
 
-// @public
-export class AzureApplicationCredential extends ChainedTokenCredential {
-    constructor(options?: AzureApplicationCredentialOptions);
-}
-
-// @public
-export interface AzureApplicationCredentialOptions extends TokenCredentialOptions, CredentialPersistenceOptions {
-    managedIdentityClientId?: string;
-}
-
 // @public
 export enum AzureAuthorityHosts {
     AzureChina = "https://login.chinacloudapi.cn",
diff --git a/sdk/identity/identity/src/index.ts b/sdk/identity/identity/src/index.ts
index 643edee90d88..a0d59fc683b9 100644
--- a/sdk/identity/identity/src/index.ts
+++ b/sdk/identity/identity/src/index.ts
@@ -63,10 +63,6 @@ export { UsernamePasswordCredentialOptions } from "./credentials/usernamePasswor
 export { AuthorizationCodeCredential } from "./credentials/authorizationCodeCredential";
 export { AzurePowerShellCredential } from "./credentials/azurePowerShellCredential";
 export { AzurePowerShellCredentialOptions } from "./credentials/azurePowerShellCredentialOptions";
-export {
-  AzureApplicationCredential,
-  AzureApplicationCredentialOptions
-} from "./credentials/azureApplicationCredential";
 
 export {
   VisualStudioCodeCredential,
diff --git a/sdk/identity/identity/test/internal/node/azureApplicationCredential.spec.ts b/sdk/identity/identity/test/internal/node/azureApplicationCredential.spec.ts
index 4ee0220d33e6..faadac9f2dc1 100644
--- a/sdk/identity/identity/test/internal/node/azureApplicationCredential.spec.ts
+++ b/sdk/identity/identity/test/internal/node/azureApplicationCredential.spec.ts
@@ -3,7 +3,7 @@
 
 import { assert } from "chai";
 import { RestError } from "@azure/core-rest-pipeline";
-import { AzureApplicationCredential } from "../../../src";
+import { AzureApplicationCredential } from "../../../src/credentials/azureApplicationCredential";
 import { prepareIdentityTests } from "../../httpRequests";
 import {
   createResponse,
diff --git a/sdk/identity/identity/test/public/node/azureApplicationCredential.spec.ts b/sdk/identity/identity/test/public/node/azureApplicationCredential.spec.ts
index 53aebe1663d7..338a6c5aca34 100644
--- a/sdk/identity/identity/test/public/node/azureApplicationCredential.spec.ts
+++ b/sdk/identity/identity/test/public/node/azureApplicationCredential.spec.ts
@@ -2,12 +2,20 @@
 // Licensed under the MIT license.
 
 import { assert } from "chai";
-import { AzureApplicationCredential } from "../../../src";
 import { MsalTestCleanup, msalNodeTestSetup, testTracing } from "../../msalTestUtils";
 import { getError } from "../../authTestUtils";
 import { Context } from "mocha";
+import { AccessToken, GetTokenOptions, TokenCredential } from "@azure/core-auth";
 
-describe("AzureApplicationCredential", function() {
+// TODO: Use the real one once we decide to re-enable this on the public API.
+class AzureApplicationCredential implements TokenCredential {
+  getToken(_scope: string | string[], _getTokenOptions?: GetTokenOptions): Promise<AccessToken> {
+    throw new Error("Not implemented");
+  }
+}
+
+// TODO: Re-enable this when possible.
+describe.skip("AzureApplicationCredential", function() {
   let cleanup: MsalTestCleanup;
   const environmentVariableNames = ["AZURE_TENANT_ID", "AZURE_CLIENT_ID", "AZURE_CLIENT_SECRET"];
   const cachedValues: Record<string, string | undefined> = {};