diff --git a/buildscripts/kokoro/xds.sh b/buildscripts/kokoro/xds.sh
index 153d40b68e..34ef69b89f 100755
--- a/buildscripts/kokoro/xds.sh
+++ b/buildscripts/kokoro/xds.sh
@@ -8,7 +8,8 @@ fi
 cd github
 
 pushd grpc-java/interop-testing
-../gradlew installDist -x test -PskipCodegen=true -PskipAndroid=true
+GRADLE_OPTS="-Dorg.gradle.jvmargs='-Xmx1g'" \
+  ../gradlew installDist -x test -PskipCodegen=true -PskipAndroid=true
 popd
 
 git clone -b master --single-branch --depth=1 https://github.com/grpc/grpc.git