diff --git a/netsim/ansible/templates/mpls/srlinux.j2 b/netsim/ansible/templates/mpls/srlinux.j2
index 2a3273ce05..3d6dcae692 100644
--- a/netsim/ansible/templates/mpls/srlinux.j2
+++ b/netsim/ansible/templates/mpls/srlinux.j2
@@ -1,4 +1,7 @@
 updates:
 {% if ldp is defined %}
-{%   include 'srlinux.ldp.j2' +%}
+{%   include 'srlinux/ldp.j2' +%}
+{% endif %}
+{% if mpls.vpn is defined %}
+{%   include 'srlinux/vpn.j2' +%}
 {% endif %}
diff --git a/netsim/ansible/templates/mpls/srlinux.ldp.j2 b/netsim/ansible/templates/mpls/srlinux/ldp.j2
similarity index 100%
rename from netsim/ansible/templates/mpls/srlinux.ldp.j2
rename to netsim/ansible/templates/mpls/srlinux/ldp.j2
diff --git a/netsim/ansible/templates/mpls/srlinux/vpn.j2 b/netsim/ansible/templates/mpls/srlinux/vpn.j2
new file mode 100644
index 0000000000..bc9db40b84
--- /dev/null
+++ b/netsim/ansible/templates/mpls/srlinux/vpn.j2
@@ -0,0 +1,44 @@
+- path: /system/mpls/label-ranges/dynamic[name=vpn]
+  value:
+    start-label: 20000
+    end-label: 30000
+
+- path: /system/mpls/services
+  value:
+    network-instance:
+      dynamic-label-block: vpn
+
+{% for af in ['ipv4','ipv6'] if mpls.vpn[af] is defined %}
+{%   if loop.first %}
+- path: /network-instance[name=default]/protocols/bgp
+  value:
+    afi-safi:
+{%   endif %}
+    - afi-safi-name: l3vpn-{{ af }}-unicast
+      admin-state: enable
+      l3vpn-{{ af }}-unicast:
+        rapid-update: True
+        keep-all-routes: True
+{% endfor %}
+{% for n_type in ['ibgp','ebgp'] %}
+{%   for af in ['ipv4','ipv6'] if n_type in mpls.vpn[af]|default([]) %}
+{%     if loop.first %}
+- path: /network-instance[name=default]/protocols/bgp/group[group-name={{ n_type }}-ipv4]
+  value:
+    afi-safi:
+{%     endif %}
+    - afi-safi-name: l3vpn-{{ af }}-unicast
+      admin-state: enable
+      send-community-type: [ standard, extended ]
+{%   endfor %}
+{% endfor %}
+{% for v_name,v_data in vrfs|default({})|dictsort %}
+- path: /network-instance[name={{ v_name }}]/protocols/bgp-ipvpn
+  value:
+    bgp-instance:
+    - id: 1
+      admin-state: enable
+      mpls:
+        next-hop-resolution:
+          allowed-tunnel-types: [ ldp, sr-isis ]
+{% endfor %}
diff --git a/netsim/ansible/templates/vrf/srlinux.j2 b/netsim/ansible/templates/vrf/srlinux.j2
index 96f84eb622..d075fd042c 100644
--- a/netsim/ansible/templates/vrf/srlinux.j2
+++ b/netsim/ansible/templates/vrf/srlinux.j2
@@ -53,10 +53,17 @@ updates:
 
 - path: /network-instance[name={{vname}}]/protocols/bgp-vpn
   value:
-   bgp-instance:
-   - id: 1
-     route-distinguisher:
-      rd: "{{ vdata.rd }}"
+    bgp-instance:
+    - id: 1
+      route-distinguisher:
+        rd: "{{ vdata.rd }}"
+      route-target:
+{% if vdata.import %}
+        import-rt: "target:{{ vdata.import[0] }}"
+{% endif %}
+{% if vdata.export %}
+        export-rt: "target:{{ vdata.export[0] }}"
+{% endif %}
 
 {% if vdata.export|default([]) and vdata.import|default([]) %}
 - path: /network-instance[name={{vname}}]/inter-instance-policies
diff --git a/netsim/devices/srlinux.yml b/netsim/devices/srlinux.yml
index 46e47b5791..5004c611f6 100644
--- a/netsim/devices/srlinux.yml
+++ b/netsim/devices/srlinux.yml
@@ -81,8 +81,9 @@ features:
       ipv6: True
       network: True
     import: [ ospf, bgp, connected, static, vrf, no_policy ]
-  mpls:
-    ldp: True                           # on 7250 IXR only
+  mpls:                           # on 7250 IXR only
+    ldp: True
+    vpn: True
   ospf:
     unnumbered: True
     import: [ bgp, isis, connected, static, vrf, no_policy ]