diff --git a/pilot/pkg/serviceregistry/kube/controller/ambient/waypoints.go b/pilot/pkg/serviceregistry/kube/controller/ambient/waypoints.go
index f84f916818b6..abe972d6adf0 100644
--- a/pilot/pkg/serviceregistry/kube/controller/ambient/waypoints.go
+++ b/pilot/pkg/serviceregistry/kube/controller/ambient/waypoints.go
@@ -200,21 +200,23 @@ func WaypointsCollection(
 			return p.Spec.ServiceAccountName
 		})
 
+		// default traffic type if neither GatewayClass nor Gateway specify a type
+		trafficType := constants.ServiceTraffic
+
 		gatewayClass := ptr.OrEmpty(krt.FetchOne(ctx, GatewayClasses, krt.FilterKey(string(gateway.Spec.GatewayClassName))))
 		if gatewayClass == nil {
 			log.Warnf("could not find GatewayClass %s for Gateway %s/%s", gateway.Spec.GatewayClassName, gateway.Namespace, gateway.Name)
+		} else if tt, found := gatewayClass.Labels[constants.AmbientWaypointForTrafficTypeLabel]; found {
+			// Check for a declared traffic type that is allowed to pass through the Waypoint's GatewayClass
+			trafficType = tt
 		}
 
 		// Check for a declared traffic type that is allowed to pass through the Waypoint
 		if tt, found := gateway.Labels[constants.AmbientWaypointForTrafficTypeLabel]; found {
-			return makeWaypoint(gateway, gatewayClass, serviceAccounts, tt)
+			trafficType = tt
 		}
-		// If a value is not declared on a Gateway or its associated GatewayClass
-		// then the network layer should default to service when redirecting traffic.
-		//
-		// This is a safety measure to ensure that the Gateway is not misconfigured, but
-		// we will likely not hit this case as the CLI will validate the traffic type.
-		return makeWaypoint(gateway, gatewayClass, serviceAccounts, constants.ServiceTraffic)
+
+		return makeWaypoint(gateway, gatewayClass, serviceAccounts, trafficType)
 	}, krt.WithName("Waypoints"))
 }
 
diff --git a/releasenotes/notes/50933.yaml b/releasenotes/notes/50933.yaml
new file mode 100644
index 000000000000..edc89b028dd2
--- /dev/null
+++ b/releasenotes/notes/50933.yaml
@@ -0,0 +1,34 @@
+apiVersion: release-notes/v2
+
+# This YAML file describes the format for specifying a release notes entry for Istio.
+# This should be filled in for all user facing changes.
+
+# kind describes the type of change that this represents.
+# Valid Values are:
+# - bug-fix -- Used to specify that this change represents a bug fix.
+# - security-fix -- Used to specify that this change represents a vulnerability fix.
+# - feature -- Used to specify a new feature that has been added.
+# - test -- Used to describe additional testing added. This file is optional for
+#   tests, but included for completeness.
+kind: feature
+
+# area describes the area that this change affects.
+# Valid values are:
+# - traffic-management
+# - security
+# - telemetry
+# - installation
+# - istioctl
+# - documentation
+area: traffic-management
+
+# issue is a list of GitHub issues resolved in this note.
+# If issue is not in the current repo, specify its full URL instead.
+issue:
+- 50933
+
+# releaseNotes is a markdown listing of any user facing changes. This will appear in the
+# release notes.
+releaseNotes:
+- |
+  **Added** reading the traffic type for a waypoint from the istio.io/waypoint-for label on the parent gateway class. This value overrides the global default and will be overridden if the label is applied to the waypoint resource.