diff --git a/e2e/assets/single-cluster/namespaceLabels_targetCustomization.yaml b/e2e/assets/single-cluster/namespaceLabels_targetCustomization.yaml
new file mode 100644
index 0000000000..f53ed41b38
--- /dev/null
+++ b/e2e/assets/single-cluster/namespaceLabels_targetCustomization.yaml
@@ -0,0 +1,10 @@
+kind: GitRepo
+apiVersion: fleet.cattle.io/v1alpha1
+metadata:
+  name: test
+  namespace: fleet-local
+spec:
+  repo: https://github.com/Tommy12789/fleet-examples-tommy
+  branch: test
+  paths:
+    - namespaceLabels_targetCustomization
diff --git a/e2e/single-cluster/targetCustomization_test.go b/e2e/single-cluster/targetCustomization_test.go
new file mode 100644
index 0000000000..80c69e2144
--- /dev/null
+++ b/e2e/single-cluster/targetCustomization_test.go
@@ -0,0 +1,78 @@
+package singlecluster_test
+
+import (
+	"strings"
+
+	"github.com/rancher/fleet/e2e/testenv"
+	"github.com/rancher/fleet/e2e/testenv/kubectl"
+
+	. "github.com/onsi/ginkgo/v2"
+	. "github.com/onsi/gomega"
+)
+
+var _ = Describe("Helm deploy options", func() {
+	var (
+		asset string
+		k     kubectl.Command
+	)
+	BeforeEach(func() {
+		k = env.Kubectl.Namespace(env.Namespace)
+	})
+
+	JustBeforeEach(func() {
+		out, err := k.Apply("-f", testenv.AssetPath(asset))
+		Expect(err).ToNot(HaveOccurred(), out)
+	})
+
+	AfterEach(func() {
+		out, err := k.Delete("-f", testenv.AssetPath(asset))
+		Expect(err).ToNot(HaveOccurred(), out)
+	})
+
+	Describe("namespaceLabels TargetCustomization", func() {
+		BeforeEach(func() {
+			asset = "single-cluster/namespaceLabels_targetCustomization.yaml"
+		})
+		When("namespaceLabels set as targetCustomization ", func() {
+			It("deploy the bundledeployment with the merged namespaceLabels", func() {
+				Eventually(func() string {
+					bundleDeploymentNames, _ := k.Namespace("cluster-fleet-local-local-1a3d67d0a899").Get("bundledeployments", "-o", "jsonpath={.items[*].metadata.name}")
+
+					var bundleDeploymentName string
+					for _, podName := range strings.Split(bundleDeploymentNames, " ") {
+						if strings.HasPrefix(podName, "test-namespacelabels-targetcustomization") {
+							bundleDeploymentName = podName
+							break
+						}
+					}
+					if bundleDeploymentName == "" {
+						return "nil"
+					}
+
+					bundleDeploymentNamespacesLabels, _ := k.Namespace("cluster-fleet-local-local-1a3d67d0a899").Get("bundledeployments", bundleDeploymentName, "-o", "jsonpath={.spec.options.namespaceLabels}")
+					return bundleDeploymentNamespacesLabels
+				}).Should(Equal(`{"foo":"bar","this.is/a":"test"}`))
+
+				Eventually(func() string {
+					bundleDeploymentNames, _ := k.Namespace("cluster-fleet-local-local-1a3d67d0a899").Get("bundledeployments", "-o", "jsonpath={.items[*].metadata.name}")
+
+					var bundleDeploymentName string
+					for _, podName := range strings.Split(bundleDeploymentNames, " ") {
+						if strings.HasPrefix(podName, "test-namespacelabels-targetcustomization") {
+							bundleDeploymentName = podName
+							break
+						}
+					}
+					if bundleDeploymentName == "" {
+						return "nil"
+					}
+
+					bundleDeploymentNamespacesLabels, _ := k.Namespace("cluster-fleet-local-local-1a3d67d0a899").Get("bundledeployments", bundleDeploymentName, "-o", "jsonpath={.spec.options.namespaceAnnotations}")
+					return bundleDeploymentNamespacesLabels
+				}).Should(Equal(`{"foo":"bar","this.is/a":"test"}`))
+
+			})
+		})
+	})
+
+})
diff --git a/internal/cmd/controller/target/target.go b/internal/cmd/controller/target/target.go
index 9025f2c1da..bc320086dc 100644
--- a/internal/cmd/controller/target/target.go
+++ b/internal/cmd/controller/target/target.go
@@ -58,6 +58,22 @@ func (t *Target) BundleDeployment() *fleet.BundleDeployment {
 		Spec: t.Deployment.Spec,
 	}
 	bd.Spec.Paused = t.IsPaused()
+	for _, bundleTarget := range t.Bundle.Spec.Targets {
+		if bundleTarget.NamespaceLabels != nil {
+			for key, value := range *bundleTarget.NamespaceLabels {
+				(*bd.Spec.Options.NamespaceLabels)[key] = value
+				(*bd.Spec.StagedOptions.NamespaceLabels)[key] = value
+			}
+		}
+	}
+	for _, bundleTargets := range t.Bundle.Spec.Targets {
+		if bundleTargets.NamespaceAnnotations != nil {
+			for key, value := range *bundleTargets.NamespaceAnnotations {
+				(*bd.Spec.Options.NamespaceAnnotations)[key] = value
+				(*bd.Spec.StagedOptions.NamespaceAnnotations)[key] = value
+			}
+		}
+	}
 	bd.Spec.DependsOn = t.Bundle.Spec.DependsOn
 	bd.Spec.CorrectDrift = t.Options.CorrectDrift
 	return bd
diff --git a/pkg/apis/fleet.cattle.io/v1alpha1/bundle_types.go b/pkg/apis/fleet.cattle.io/v1alpha1/bundle_types.go
index 65e2d9da09..a3431fbd37 100644
--- a/pkg/apis/fleet.cattle.io/v1alpha1/bundle_types.go
+++ b/pkg/apis/fleet.cattle.io/v1alpha1/bundle_types.go
@@ -227,6 +227,12 @@ type BundleTarget struct {
 	ClusterGroupSelector *metav1.LabelSelector `json:"clusterGroupSelector,omitempty"`
 	// DoNotDeploy if set to true, will not deploy to this target.
 	DoNotDeploy bool `json:"doNotDeploy,omitempty"`
+	// NamespaceLabels are labels that will be appended to the namespace created by Fleet.
+	// +nullable
+	NamespaceLabels *map[string]string `json:"namespaceLabels,omitempty"`
+	// NamespaceAnnotations are annotations that will be appended to the namespace created by Fleet.
+	// +nullable
+	NamespaceAnnotations *map[string]string `json:"namespaceAnnotations,omitempty"`
 }
 
 // BundleSummary contains the number of bundle deployments in each state and a
diff --git a/pkg/apis/fleet.cattle.io/v1alpha1/zz_generated.deepcopy.go b/pkg/apis/fleet.cattle.io/v1alpha1/zz_generated.deepcopy.go
index fe60d80726..8ae8fbfb5a 100644
--- a/pkg/apis/fleet.cattle.io/v1alpha1/zz_generated.deepcopy.go
+++ b/pkg/apis/fleet.cattle.io/v1alpha1/zz_generated.deepcopy.go
@@ -579,6 +579,28 @@ func (in *BundleTarget) DeepCopyInto(out *BundleTarget) {
 		*out = new(v1.LabelSelector)
 		(*in).DeepCopyInto(*out)
 	}
+	if in.NamespaceLabels != nil {
+		in, out := &in.NamespaceLabels, &out.NamespaceLabels
+		*out = new(map[string]string)
+		if **in != nil {
+			in, out := *in, *out
+			*out = make(map[string]string, len(*in))
+			for key, val := range *in {
+				(*out)[key] = val
+			}
+		}
+	}
+	if in.NamespaceAnnotations != nil {
+		in, out := &in.NamespaceAnnotations, &out.NamespaceAnnotations
+		*out = new(map[string]string)
+		if **in != nil {
+			in, out := *in, *out
+			*out = make(map[string]string, len(*in))
+			for key, val := range *in {
+				(*out)[key] = val
+			}
+		}
+	}
 }
 
 // DeepCopy is an autogenerated deepcopy function, copying the receiver, creating a new BundleTarget.