diff --git a/boards/arm/lc823450/lc823450-xgevk/configs/bt/defconfig b/boards/arm/lc823450/lc823450-xgevk/configs/bt/defconfig
index a91c18d3d53..6e9c11e211b 100644
--- a/boards/arm/lc823450/lc823450-xgevk/configs/bt/defconfig
+++ b/boards/arm/lc823450/lc823450-xgevk/configs/bt/defconfig
@@ -145,7 +145,6 @@ CONFIG_SYSTEM_SYSTEM=y
 CONFIG_SYSTEM_TASKSET=y
 CONFIG_SYSTEM_TIME64=y
 CONFIG_TASK_NAME_SIZE=24
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TESTING_GETPRIME=y
 CONFIG_TESTING_OSTEST=y
 CONFIG_TESTING_SMP=y
diff --git a/boards/arm/lc823450/lc823450-xgevk/configs/krndis/defconfig b/boards/arm/lc823450/lc823450-xgevk/configs/krndis/defconfig
index 95bc96c44e6..0140754590e 100644
--- a/boards/arm/lc823450/lc823450-xgevk/configs/krndis/defconfig
+++ b/boards/arm/lc823450/lc823450-xgevk/configs/krndis/defconfig
@@ -171,7 +171,6 @@ CONFIG_SYSTEM_NXPLAYER=y
 CONFIG_SYSTEM_PING=y
 CONFIG_SYSTEM_TIME64=y
 CONFIG_TASK_NAME_SIZE=24
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TESTING_OSTEST=y
 CONFIG_UART0_RXBUFSIZE=512
 CONFIG_UART0_SERIAL_CONSOLE=y
diff --git a/boards/arm/lc823450/lc823450-xgevk/configs/rndis/defconfig b/boards/arm/lc823450/lc823450-xgevk/configs/rndis/defconfig
index a3f3a833997..af3b2275ed6 100644
--- a/boards/arm/lc823450/lc823450-xgevk/configs/rndis/defconfig
+++ b/boards/arm/lc823450/lc823450-xgevk/configs/rndis/defconfig
@@ -172,7 +172,6 @@ CONFIG_SYSTEM_SYSTEM=y
 CONFIG_SYSTEM_TASKSET=y
 CONFIG_SYSTEM_TIME64=y
 CONFIG_TASK_NAME_SIZE=24
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TESTING_GETPRIME=y
 CONFIG_TESTING_OSTEST=y
 CONFIG_TESTING_SMP=y
diff --git a/boards/sim/sim/sim/configs/tcpblaster/defconfig b/boards/sim/sim/sim/configs/tcpblaster/defconfig
index 46d29f78b99..9fe7662145f 100644
--- a/boards/sim/sim/sim/configs/tcpblaster/defconfig
+++ b/boards/sim/sim/sim/configs/tcpblaster/defconfig
@@ -113,7 +113,6 @@ CONFIG_SYSTEM_SYSTEM=y
 CONFIG_SYSTEM_TELNET_CLIENT=y
 CONFIG_SYSTEM_TIME64=y
 CONFIG_TASK_NAME_SIZE=32
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TELNET_TXBUFFER_SIZE=64
 CONFIG_TTY_SIGINT=y
 CONFIG_TTY_SIGINT_CHAR=0x3
diff --git a/boards/xtensa/esp32/esp32-audio-kit/configs/audio/defconfig b/boards/xtensa/esp32/esp32-audio-kit/configs/audio/defconfig
index 8ce0811cd85..44f1ba3ff76 100644
--- a/boards/xtensa/esp32/esp32-audio-kit/configs/audio/defconfig
+++ b/boards/xtensa/esp32/esp32-audio-kit/configs/audio/defconfig
@@ -112,7 +112,6 @@ CONFIG_SYSTEM_DHCPC_RENEW=y
 CONFIG_SYSTEM_NSH=y
 CONFIG_SYSTEM_NXPLAYER=y
 CONFIG_SYSTEM_PING=y
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TLS_TASK_NELEM=4
 CONFIG_UART0_SERIAL_CONSOLE=y
 CONFIG_WIRELESS=y
diff --git a/boards/xtensa/esp32/esp32-audio-kit/configs/wifi/defconfig b/boards/xtensa/esp32/esp32-audio-kit/configs/wifi/defconfig
index 6ff6b8c758b..a2e91de2d33 100644
--- a/boards/xtensa/esp32/esp32-audio-kit/configs/wifi/defconfig
+++ b/boards/xtensa/esp32/esp32-audio-kit/configs/wifi/defconfig
@@ -82,7 +82,6 @@ CONFIG_SYSTEM_DHCPC_RENEW=y
 CONFIG_SYSTEM_NSH=y
 CONFIG_SYSTEM_PING=y
 CONFIG_SYSTEM_STACKMONITOR=y
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TLS_TASK_NELEM=4
 CONFIG_UART0_SERIAL_CONSOLE=y
 CONFIG_WIRELESS=y
diff --git a/boards/xtensa/esp32/esp32-devkitc/configs/audio/defconfig b/boards/xtensa/esp32/esp32-devkitc/configs/audio/defconfig
index 8fbc8481b3d..baaabf67bd8 100644
--- a/boards/xtensa/esp32/esp32-devkitc/configs/audio/defconfig
+++ b/boards/xtensa/esp32/esp32-devkitc/configs/audio/defconfig
@@ -117,7 +117,6 @@ CONFIG_SYSTEM_DHCPC_RENEW=y
 CONFIG_SYSTEM_NSH=y
 CONFIG_SYSTEM_NXPLAYER=y
 CONFIG_SYSTEM_PING=y
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TLS_TASK_NELEM=4
 CONFIG_UART0_SERIAL_CONSOLE=y
 CONFIG_WIRELESS=y
diff --git a/boards/xtensa/esp32/esp32-devkitc/configs/blewifi/defconfig b/boards/xtensa/esp32/esp32-devkitc/configs/blewifi/defconfig
index ec2b42fd804..35012de6894 100644
--- a/boards/xtensa/esp32/esp32-devkitc/configs/blewifi/defconfig
+++ b/boards/xtensa/esp32/esp32-devkitc/configs/blewifi/defconfig
@@ -142,7 +142,6 @@ CONFIG_SYSTEM_DHCPC_RENEW=y
 CONFIG_SYSTEM_NSH=y
 CONFIG_SYSTEM_PING=y
 CONFIG_SYSTEM_TELNETD=y
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TLS_TASK_NELEM=4
 CONFIG_UART0_SERIAL_CONSOLE=y
 CONFIG_WIRELESS=y
diff --git a/boards/xtensa/esp32/esp32-devkitc/configs/efuse/defconfig b/boards/xtensa/esp32/esp32-devkitc/configs/efuse/defconfig
index 3f847f4a3c4..395432e8863 100644
--- a/boards/xtensa/esp32/esp32-devkitc/configs/efuse/defconfig
+++ b/boards/xtensa/esp32/esp32-devkitc/configs/efuse/defconfig
@@ -94,7 +94,6 @@ CONFIG_SYSTEM_DHCPC_RENEW=y
 CONFIG_SYSTEM_NSH=y
 CONFIG_SYSTEM_PING=y
 CONFIG_SYSTEM_STACKMONITOR=y
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TLS_TASK_NELEM=4
 CONFIG_UART0_SERIAL_CONSOLE=y
 CONFIG_WIRELESS=y
diff --git a/boards/xtensa/esp32/esp32-devkitc/configs/nxlooper/defconfig b/boards/xtensa/esp32/esp32-devkitc/configs/nxlooper/defconfig
index 9817112f820..c76afce6024 100644
--- a/boards/xtensa/esp32/esp32-devkitc/configs/nxlooper/defconfig
+++ b/boards/xtensa/esp32/esp32-devkitc/configs/nxlooper/defconfig
@@ -119,7 +119,6 @@ CONFIG_SYSTEM_NSH=y
 CONFIG_SYSTEM_NXLOOPER=y
 CONFIG_SYSTEM_NXPLAYER=y
 CONFIG_SYSTEM_PING=y
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TLS_TASK_NELEM=4
 CONFIG_UART0_SERIAL_CONSOLE=y
 CONFIG_WIRELESS=y
diff --git a/boards/xtensa/esp32/esp32-devkitc/configs/wifi/defconfig b/boards/xtensa/esp32/esp32-devkitc/configs/wifi/defconfig
index 0cc0d9a5ea0..5f322498fb8 100644
--- a/boards/xtensa/esp32/esp32-devkitc/configs/wifi/defconfig
+++ b/boards/xtensa/esp32/esp32-devkitc/configs/wifi/defconfig
@@ -82,7 +82,6 @@ CONFIG_SYSTEM_DHCPC_RENEW=y
 CONFIG_SYSTEM_NSH=y
 CONFIG_SYSTEM_PING=y
 CONFIG_SYSTEM_STACKMONITOR=y
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TLS_TASK_NELEM=4
 CONFIG_UART0_SERIAL_CONSOLE=y
 CONFIG_WIRELESS=y
diff --git a/boards/xtensa/esp32/esp32-lyrat/configs/audio/defconfig b/boards/xtensa/esp32/esp32-lyrat/configs/audio/defconfig
index a7bf4aafe52..17c49d786e6 100644
--- a/boards/xtensa/esp32/esp32-lyrat/configs/audio/defconfig
+++ b/boards/xtensa/esp32/esp32-lyrat/configs/audio/defconfig
@@ -116,7 +116,6 @@ CONFIG_SYSTEM_DHCPC_RENEW=y
 CONFIG_SYSTEM_NSH=y
 CONFIG_SYSTEM_NXPLAYER=y
 CONFIG_SYSTEM_PING=y
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TLS_TASK_NELEM=4
 CONFIG_UART0_SERIAL_CONSOLE=y
 CONFIG_WIRELESS=y
diff --git a/boards/xtensa/esp32/esp32-lyrat/configs/wifi/defconfig b/boards/xtensa/esp32/esp32-lyrat/configs/wifi/defconfig
index 790ed9c53c0..09bd613d238 100644
--- a/boards/xtensa/esp32/esp32-lyrat/configs/wifi/defconfig
+++ b/boards/xtensa/esp32/esp32-lyrat/configs/wifi/defconfig
@@ -82,7 +82,6 @@ CONFIG_SYSTEM_DHCPC_RENEW=y
 CONFIG_SYSTEM_NSH=y
 CONFIG_SYSTEM_PING=y
 CONFIG_SYSTEM_STACKMONITOR=y
-CONFIG_TELNET_CHARACTER_MODE=y
 CONFIG_TLS_TASK_NELEM=4
 CONFIG_UART0_SERIAL_CONSOLE=y
 CONFIG_WIRELESS=y
diff --git a/drivers/net/Kconfig b/drivers/net/Kconfig
index a8fe30d9d96..b8c855083a8 100644
--- a/drivers/net/Kconfig
+++ b/drivers/net/Kconfig
@@ -73,14 +73,6 @@ config TELNET_MAXLCLIENTS
 		number.  This limitation is somewhat artificial since it only
 		determines the size of a fixed-size, preallocated, internal array.
 
-config TELNET_CHARACTER_MODE
-	bool "Character mode"
-	default n
-	---help---
-		The Telnet daemon works in character mode. In this case, the daemon
-		will echo a character which telnet client sent. By default, it works
-		in line mode.
-
 config TELNET_SUPPORT_NAWS
 	bool "Support NAWS (Negotiate About Window Size)"
 	default n
diff --git a/drivers/net/telnet.c b/drivers/net/telnet.c
index 5176ee04579..1a77e29d005 100644
--- a/drivers/net/telnet.c
+++ b/drivers/net/telnet.c
@@ -311,18 +311,11 @@ static void telnet_getchar(FAR struct telnet_dev_s *priv, uint8_t ch,
 {
   register int index;
 
-#ifndef CONFIG_TELNET_CHARACTER_MODE
-  /* Ignore carriage returns */
+  /* Add all characters to the destination buffer */
 
-  if (ch != TELNET_CR)
-#endif
-    {
-      /* Add all other characters to the destination buffer */
-
-      index = *nread;
-      dest[index++] = ch;
-      *nread = index;
-    }
+  index = *nread;
+  dest[index++] = ch;
+  *nread = index;
 }
 
 /****************************************************************************
@@ -420,25 +413,12 @@ static ssize_t telnet_receive(FAR struct telnet_dev_s *priv,
             break;
 
           case STATE_DO:
-#ifdef CONFIG_TELNET_CHARACTER_MODE
-            if (ch == TELNET_SGA || ch == TELNET_ECHO)
-              {
-                /* If it received 'ECHO' or 'Suppress Go Ahead', then do
-                 * nothing.
-                 */
-              }
-            else
-              {
-                /* Reply with a WONT */
 
-                telnet_sendopt(priv, TELNET_WONT, ch);
-                ninfo("WONT: 0x%02X\n", ch);
-              }
-#else
-            /* Reply with a WONT */
+            /* FIXME: Handle ECHO and SGA setting here
+             * Used to disable ECHO password in login nsh via telnet
+             */
 
             telnet_sendopt(priv, TELNET_WONT, ch);
-#endif
             priv->td_state = STATE_NORMAL;
             break;
 
@@ -1001,11 +981,6 @@ static int telnet_session(FAR struct telnet_session_s *session)
   telnet_sendopt(priv, TELNET_DO, TELNET_NAWS);
 #endif
 
-#ifdef CONFIG_TELNET_CHARACTER_MODE
-  telnet_sendopt(priv, TELNET_WILL, TELNET_SGA);
-  telnet_sendopt(priv, TELNET_WILL, TELNET_ECHO);
-#endif
-
   /* Save ourself in the list of Telnet client threads */
 
   g_telnet_clients[priv->td_minor] = priv;