diff --git a/pkg/proxy/topology.go b/pkg/proxy/topology.go
index ef16d559b1c..d68aeb40f94 100644
--- a/pkg/proxy/topology.go
+++ b/pkg/proxy/topology.go
@@ -52,6 +52,19 @@ func CategorizeEndpoints(endpoints []Endpoint, svcInfo ServicePort, nodeLabels m
 			return true
 		})
 
+		// if there are 0 cluster-wide endpoints, we can try to fallback to any terminating endpoints that are ready.
+		// When falling back to terminating endpoints, we do NOT consider topology aware routing since this is a best
+		// effort attempt to avoid dropping connections.
+		if len(clusterEndpoints) == 0 && utilfeature.DefaultFeatureGate.Enabled(features.ProxyTerminatingEndpoints) {
+			clusterEndpoints = filterEndpoints(endpoints, func(ep Endpoint) bool {
+				if ep.IsServing() && ep.IsTerminating() {
+					return true
+				}
+
+				return false
+			})
+		}
+
 		// If there are any Ready endpoints anywhere in the cluster, we are
 		// guaranteed to get one in clusterEndpoints.
 		if len(clusterEndpoints) > 0 {
diff --git a/pkg/proxy/topology_test.go b/pkg/proxy/topology_test.go
index 35c110815a2..cdab4926ccb 100644
--- a/pkg/proxy/topology_test.go
+++ b/pkg/proxy/topology_test.go
@@ -350,7 +350,17 @@ func TestCategorizeEndpoints(t *testing.T) {
 		serviceInfo: &BaseServiceInfo{},
 		endpoints: []Endpoint{
 			&BaseEndpointInfo{Endpoint: "10.0.0.0:80", Ready: false, Serving: true, Terminating: true, IsLocal: true},
-			&BaseEndpointInfo{Endpoint: "10.0.0.1:80", Ready: false, Serving: true, Terminating: true, IsLocal: true},
+			&BaseEndpointInfo{Endpoint: "10.0.0.1:80", Ready: false, Serving: true, Terminating: true, IsLocal: false},
+		},
+		clusterEndpoints: sets.NewString("10.0.0.0:80", "10.0.0.1:80"),
+		localEndpoints:   nil,
+	}, {
+		name:        "Cluster traffic policy, PTE disabled, all endpoints are terminating",
+		pteEnabled:  false,
+		serviceInfo: &BaseServiceInfo{},
+		endpoints: []Endpoint{
+			&BaseEndpointInfo{Endpoint: "10.0.0.0:80", Ready: false, Serving: true, Terminating: true, IsLocal: true},
+			&BaseEndpointInfo{Endpoint: "10.0.0.1:80", Ready: false, Serving: true, Terminating: true, IsLocal: false},
 		},
 		clusterEndpoints: sets.NewString(),
 		localEndpoints:   nil,
@@ -412,9 +422,9 @@ func TestCategorizeEndpoints(t *testing.T) {
 			&BaseEndpointInfo{Endpoint: "10.0.0.0:80", Ready: false, Serving: true, Terminating: true, IsLocal: false},
 			&BaseEndpointInfo{Endpoint: "10.0.0.1:80", Ready: false, Serving: true, Terminating: true, IsLocal: false},
 		},
-		clusterEndpoints:    sets.NewString(),
+		clusterEndpoints:    sets.NewString("10.0.0.0:80", "10.0.0.1:80"),
 		localEndpoints:      sets.NewString(),
-		allEndpoints:        sets.NewString(),
+		allEndpoints:        sets.NewString("10.0.0.0:80", "10.0.0.1:80"),
 		onlyRemoteEndpoints: true,
 	}, {
 		name:        "iTP: Cluster, eTP: Local, PTE disabled, with terminating endpoints",