diff --git a/src/main/java/org/springframework/data/neo4j/core/DynamicLabels.java b/src/main/java/org/springframework/data/neo4j/core/DynamicLabels.java
index 2be8dc1e10..6a8f3a1752 100644
--- a/src/main/java/org/springframework/data/neo4j/core/DynamicLabels.java
+++ b/src/main/java/org/springframework/data/neo4j/core/DynamicLabels.java
@@ -52,6 +52,12 @@ final class DynamicLabels implements UnaryOperator<OngoingMatchAndUpdate> {
 	public OngoingMatchAndUpdate apply(OngoingMatchAndUpdate ongoingMatchAndUpdate) {
 
 		OngoingMatchAndUpdate decoratedMatchAndUpdate = ongoingMatchAndUpdate;
+
+		if (oldLabels.equals(newLabels) || oldLabels.isEmpty()) {
+			// Returning if old label equals new label or old labels are empty, nothing to do here
+			return decoratedMatchAndUpdate;
+		}
+
 		if (!oldLabels.isEmpty()) {
 			decoratedMatchAndUpdate = decoratedMatchAndUpdate.remove(rootNode, oldLabels.toArray(new String[0]));
 		}
@@ -60,4 +66,8 @@ public OngoingMatchAndUpdate apply(OngoingMatchAndUpdate ongoingMatchAndUpdate)
 		}
 		return decoratedMatchAndUpdate;
 	}
+
+	public List<String> getNewLabels() {
+		return newLabels;
+	}
 }
diff --git a/src/main/java/org/springframework/data/neo4j/core/Neo4jTemplate.java b/src/main/java/org/springframework/data/neo4j/core/Neo4jTemplate.java
index f25950666c..6cadce4e12 100644
--- a/src/main/java/org/springframework/data/neo4j/core/Neo4jTemplate.java
+++ b/src/main/java/org/springframework/data/neo4j/core/Neo4jTemplate.java
@@ -443,6 +443,10 @@ private <T> T saveImpl(T instance, @Nullable Collection<PropertyFilter.Projected
 
 		DynamicLabels dynamicLabels = determineDynamicLabels(entityToBeSaved, entityMetaData);
 
+		// Clear existing dynamic labels and populate the list with the updated set of labels.
+		entityMetaData.getDynamicLabels().clear();
+		entityMetaData.getDynamicLabels().addAll(dynamicLabels.getNewLabels());
+
 		@SuppressWarnings("unchecked") // Applies to retrieving the meta data
 		TemplateSupport.FilteredBinderFunction<T> binderFunction = TemplateSupport.createAndApplyPropertyFilter(
 				includedProperties, entityMetaData,
diff --git a/src/main/java/org/springframework/data/neo4j/core/ReactiveNeo4jTemplate.java b/src/main/java/org/springframework/data/neo4j/core/ReactiveNeo4jTemplate.java
index 8e8bceca6b..bd0667849d 100644
--- a/src/main/java/org/springframework/data/neo4j/core/ReactiveNeo4jTemplate.java
+++ b/src/main/java/org/springframework/data/neo4j/core/ReactiveNeo4jTemplate.java
@@ -458,6 +458,10 @@ private <T> Mono<T> saveImpl(T instance, @Nullable Collection<PropertyFilter.Pro
 
 					DynamicLabels dynamicLabels = t.getT2();
 
+					// Clear existing dynamic labels and populate the list with the updated set of labels.
+					entityMetaData.getDynamicLabels().clear();
+					entityMetaData.getDynamicLabels().addAll(dynamicLabels.getNewLabels());
+
 					@SuppressWarnings("unchecked")
 					FilteredBinderFunction<T> binderFunction = TemplateSupport.createAndApplyPropertyFilter(
 							includedProperties, entityMetaData,
diff --git a/src/main/java/org/springframework/data/neo4j/core/mapping/CypherGenerator.java b/src/main/java/org/springframework/data/neo4j/core/mapping/CypherGenerator.java
index 9eaccb6c47..66cf34ae8c 100644
--- a/src/main/java/org/springframework/data/neo4j/core/mapping/CypherGenerator.java
+++ b/src/main/java/org/springframework/data/neo4j/core/mapping/CypherGenerator.java
@@ -303,6 +303,10 @@ public Statement prepareSaveOf(NodeDescription<?> nodeDescription,
 		String primaryLabel = nodeDescription.getPrimaryLabel();
 		List<String> additionalLabels = nodeDescription.getAdditionalLabels();
 
+		List<String> additionalLabelsNew = new ArrayList<>(additionalLabels);
+		additionalLabelsNew.addAll(nodeDescription.getDynamicLabels());
+		Node rootNodeWithDynamicLabels = node(primaryLabel, additionalLabelsNew).named(Constants.NAME_OF_TYPED_ROOT_NODE.apply(nodeDescription));
+
 		Node rootNode = node(primaryLabel, additionalLabels).named(Constants.NAME_OF_TYPED_ROOT_NODE.apply(nodeDescription));
 		IdDescription idDescription = nodeDescription.getIdDescription();
 		Assert.notNull(idDescription, "Cannot save individual nodes without an id attribute");
@@ -320,9 +324,9 @@ public Statement prepareSaveOf(NodeDescription<?> nodeDescription,
 						.where(createCompositePropertyCondition(idPropertyDescription, possibleExistingNode.getRequiredSymbolicName(), idParameter))
 						.with(possibleExistingNode)
 						.where(possibleExistingNode.isNull())
-						.create(rootNode.withProperties(versionProperty, literalOf(0)))
-						.with(rootNode)
-						.mutate(rootNode, parameter(Constants.NAME_OF_PROPERTIES_PARAM))).returning(rootNode)
+						.create(rootNodeWithDynamicLabels.withProperties(versionProperty, literalOf(0)))
+						.with(rootNodeWithDynamicLabels)
+						.mutate(rootNodeWithDynamicLabels, parameter(Constants.NAME_OF_PROPERTIES_PARAM))).returning(rootNodeWithDynamicLabels)
 						.build();
 
 				Statement updateIfExists = updateDecorator.apply(match(rootNode)
@@ -345,9 +349,9 @@ public Statement prepareSaveOf(NodeDescription<?> nodeDescription,
 								.where(createCompositePropertyCondition(idPropertyDescription, possibleExistingNode.getRequiredSymbolicName(), idParameter))
 								.with(possibleExistingNode)
 								.where(possibleExistingNode.isNull())
-								.create(rootNode)
-								.with(rootNode)
-								.mutate(rootNode, parameter(Constants.NAME_OF_PROPERTIES_PARAM))).returning(rootNode)
+								.create(rootNodeWithDynamicLabels)
+								.with(rootNodeWithDynamicLabels)
+								.mutate(rootNodeWithDynamicLabels, parameter(Constants.NAME_OF_PROPERTIES_PARAM))).returning(rootNodeWithDynamicLabels)
 						.build();
 
 				Statement updateIfExists = updateDecorator.apply(match(rootNode)
@@ -375,10 +379,10 @@ public Statement prepareSaveOf(NodeDescription<?> nodeDescription,
 						.where(nodeIdFunction.apply(possibleExistingNode).isEqualTo(idParameter))
 						.with(possibleExistingNode)
 						.where(possibleExistingNode.isNull())
-						.create(rootNode.withProperties(versionProperty, literalOf(0)))
-						.with(rootNode)
-						.mutate(rootNode, parameter(Constants.NAME_OF_PROPERTIES_PARAM)))
-						.returning(rootNode)
+						.create(rootNodeWithDynamicLabels.withProperties(versionProperty, literalOf(0)))
+						.with(rootNodeWithDynamicLabels)
+						.mutate(rootNodeWithDynamicLabels, parameter(Constants.NAME_OF_PROPERTIES_PARAM)))
+						.returning(rootNodeWithDynamicLabels)
 						.build();
 
 				updateIfExists = updateDecorator.apply(match(rootNode)
@@ -393,9 +397,9 @@ public Statement prepareSaveOf(NodeDescription<?> nodeDescription,
 			} else {
 				createIfNew = updateDecorator
 						.apply(optionalMatch(possibleExistingNode).where(nodeIdFunction.apply(possibleExistingNode).isEqualTo(idParameter))
-								.with(possibleExistingNode).where(possibleExistingNode.isNull()).create(rootNode)
-								.set(rootNode, parameter(Constants.NAME_OF_PROPERTIES_PARAM)))
-						.returning(rootNode).build();
+								.with(possibleExistingNode).where(possibleExistingNode.isNull()).create(rootNodeWithDynamicLabels)
+								.set(rootNodeWithDynamicLabels, parameter(Constants.NAME_OF_PROPERTIES_PARAM)))
+						.returning(rootNodeWithDynamicLabels).build();
 
 				updateIfExists = updateDecorator.apply(match(rootNode).where(nodeIdFunction.apply(rootNode).isEqualTo(idParameter))
 						.mutate(rootNode, parameter(Constants.NAME_OF_PROPERTIES_PARAM))).returning(rootNode).build();
diff --git a/src/main/java/org/springframework/data/neo4j/core/mapping/DefaultNeo4jPersistentEntity.java b/src/main/java/org/springframework/data/neo4j/core/mapping/DefaultNeo4jPersistentEntity.java
index d5df9f90af..4e63ab3904 100644
--- a/src/main/java/org/springframework/data/neo4j/core/mapping/DefaultNeo4jPersistentEntity.java
+++ b/src/main/java/org/springframework/data/neo4j/core/mapping/DefaultNeo4jPersistentEntity.java
@@ -71,6 +71,8 @@ final class DefaultNeo4jPersistentEntity<T> extends BasicPersistentEntity<T, Neo
 
 	private final Lazy<List<String>> additionalLabels;
 
+	private List<String>  dynamicLabels;
+
 	/**
 	 * Projections need to be also be eligible entities but don't define id fields.
 	 */
@@ -90,8 +92,8 @@ final class DefaultNeo4jPersistentEntity<T> extends BasicPersistentEntity<T, Neo
 
 	DefaultNeo4jPersistentEntity(TypeInformation<T> information) {
 		super(information);
-
-		this.primaryLabel = computePrimaryLabel(this.getType());
+        this.dynamicLabels = new ArrayList<>();
+        this.primaryLabel = computePrimaryLabel(this.getType());
 		this.additionalLabels = Lazy.of(this::computeAdditionalLabels);
 		this.graphProperties = Lazy.of(this::computeGraphProperties);
 		this.dynamicLabelsProperty = Lazy.of(() -> getGraphProperties().stream().map(Neo4jPersistentProperty.class::cast)
@@ -166,6 +168,11 @@ public List<String> getAdditionalLabels() {
 		return this.additionalLabels.get();
 	}
 
+	@Override
+	public List<String> getDynamicLabels() {
+		return this.dynamicLabels;
+	}
+
 	/*
 	 * (non-Javadoc)
 	 * @see NodeDescription#getGraphProperty(String)
diff --git a/src/main/java/org/springframework/data/neo4j/core/mapping/NodeDescription.java b/src/main/java/org/springframework/data/neo4j/core/mapping/NodeDescription.java
index 6ab63eae8b..c1bb3559a5 100644
--- a/src/main/java/org/springframework/data/neo4j/core/mapping/NodeDescription.java
+++ b/src/main/java/org/springframework/data/neo4j/core/mapping/NodeDescription.java
@@ -48,6 +48,11 @@ public interface NodeDescription<T> {
 	 */
 	List<String> getAdditionalLabels();
 
+	/**
+	 * @return a list of dynamic label names applied to the entity
+	 */
+	List<String> getDynamicLabels();
+
 	/**
 	 * @return The list of all static labels, that is the union of {@link #getPrimaryLabel()} +
 	 *         {@link #getAdditionalLabels()}. Order is guaranteed to be the primary first, then the others.