diff --git a/loader/loader.go b/loader/loader.go
index 8fb95088..af6df117 100644
--- a/loader/loader.go
+++ b/loader/loader.go
@@ -637,6 +637,8 @@ func modelToProject(dict map[string]interface{}, opts *Options, configDetails ty
 			return nil, err
 		}
 	}
+
+	project, err = project.WithServicesLabelsResolved(opts.discardEnvFiles)
 	return project, nil
 }
 
diff --git a/loader/loader_test.go b/loader/loader_test.go
index 53186366..8f5f2cd2 100644
--- a/loader/loader_test.go
+++ b/loader/loader_test.go
@@ -2315,6 +2315,31 @@ func TestLoadServiceWithEnvFile(t *testing.T) {
 	assert.Equal(t, "YES", *service.Environment["HALLO"])
 }
 
+func TestLoadServiceWithLabelFile(t *testing.T) {
+	file, err := os.CreateTemp("", "test-compose-go")
+	assert.NilError(t, err)
+	defer os.Remove(file.Name())
+
+	_, err = file.Write([]byte("MY_LABEL=MY_VALUE"))
+	assert.NilError(t, err)
+
+	p := &types.Project{
+		Services: types.Services{
+			"test": {
+				Name: "test",
+				LabelFiles: []types.LabelFile{
+					{Path: file.Name(), Required: true},
+				},
+			},
+		},
+	}
+	p, err = p.WithServicesLabelsResolved(false)
+	assert.NilError(t, err)
+	service, err := p.GetService("test")
+	assert.NilError(t, err)
+	assert.Equal(t, "MY_VALUE", service.Labels["MY_LABEL"])
+}
+
 func TestLoadNoSSHInBuildConfig(t *testing.T) {
 	actual, err := loadYAML(`
 name: load-no-ssh-in-build-config
diff --git a/override/merge.go b/override/merge.go
index 697dbc74..8cb0ed52 100644
--- a/override/merge.go
+++ b/override/merge.go
@@ -57,6 +57,7 @@ func init() {
 	mergeSpecials["services.*.dns_search"] = mergeToSequence
 	mergeSpecials["services.*.entrypoint"] = override
 	mergeSpecials["services.*.env_file"] = mergeToSequence
+	mergeSpecials["services.*.label_file"] = mergeToSequence
 	mergeSpecials["services.*.environment"] = mergeToSequence
 	mergeSpecials["services.*.extra_hosts"] = mergeExtraHosts
 	mergeSpecials["services.*.healthcheck.test"] = override
diff --git a/override/uncity.go b/override/uncity.go
index 3b0c63d3..6b5b8ae9 100644
--- a/override/uncity.go
+++ b/override/uncity.go
@@ -51,6 +51,7 @@ func init() {
 	unique["services.*.env_file"] = envFileIndexer
 	unique["services.*.expose"] = exposeIndexer
 	unique["services.*.labels"] = keyValueIndexer
+	unique["services.*.label_file"] = labelFileIndexer
 	unique["services.*.links"] = keyValueIndexer
 	unique["services.*.networks.*.aliases"] = keyValueIndexer
 	unique["services.*.networks.*.link_local_ips"] = keyValueIndexer
@@ -227,3 +228,16 @@ func envFileIndexer(y any, p tree.Path) (string, error) {
 	}
 	return "", nil
 }
+
+func labelFileIndexer(y any, p tree.Path) (string, error) {
+	switch value := y.(type) {
+	case string:
+		return value, nil
+	case map[string]any:
+		if pathValue, ok := value["path"]; ok {
+			return pathValue.(string), nil
+		}
+		return "", fmt.Errorf("label path attribute %s is missing", p)
+	}
+	return "", nil
+}
diff --git a/paths/resolve.go b/paths/resolve.go
index 303f39e2..0569e658 100644
--- a/paths/resolve.go
+++ b/paths/resolve.go
@@ -37,6 +37,7 @@ func ResolveRelativePaths(project map[string]any, base string, remotes []RemoteR
 		"services.*.build.context":               r.absContextPath,
 		"services.*.build.additional_contexts.*": r.absContextPath,
 		"services.*.env_file.*.path":             r.absPath,
+		"services.*.label_file.*.path":           r.absPath,
 		"services.*.extends.file":                r.absExtendsPath,
 		"services.*.develop.watch.*.path":        r.absSymbolicLink,
 		"services.*.volumes.*":                   r.absVolumeMount,
diff --git a/schema/compose-spec.json b/schema/compose-spec.json
index b95a1498..fab1698f 100644
--- a/schema/compose-spec.json
+++ b/schema/compose-spec.json
@@ -240,6 +240,7 @@
         "domainname": {"type": "string"},
         "entrypoint": {"$ref": "#/definitions/command"},
         "env_file": {"$ref": "#/definitions/env_file"},
+        "label_file": {"$ref": "#/definitions/label_file"},
         "environment": {"$ref": "#/definitions/list_or_dict"},
 
         "expose": {
@@ -852,6 +853,36 @@
     },
 
     "env_file": {
+      "oneOf": [
+        {"type": "string"},
+        {
+          "type": "array",
+          "items": {
+            "oneOf": [
+              {"type": "string"},
+              {
+                "type": "object",
+                "additionalProperties": false,
+                "properties": {
+                  "path": {
+                    "type": "string"
+                  },
+                  "required": {
+                    "type": ["boolean", "string"],
+                    "default": true
+                  }
+                },
+                "required": [
+                  "path"
+                ]
+              }
+            ]
+          }
+        }
+      ]
+    },
+
+    "label_file": {
       "oneOf": [
         {"type": "string"},
         {
diff --git a/transform/canonical.go b/transform/canonical.go
index ff5bb37d..27d03810 100644
--- a/transform/canonical.go
+++ b/transform/canonical.go
@@ -30,6 +30,7 @@ func init() {
 	transformers["services.*.build.additional_contexts"] = transformKeyValue
 	transformers["services.*.depends_on"] = transformDependsOn
 	transformers["services.*.env_file"] = transformEnvFile
+	transformers["services.*.label_file"] = transformLabelFile
 	transformers["services.*.extends"] = transformExtends
 	transformers["services.*.networks"] = transformServiceNetworks
 	transformers["services.*.volumes.*"] = transformVolumeMount
diff --git a/transform/labelfile.go b/transform/labelfile.go
new file mode 100644
index 00000000..db8470df
--- /dev/null
+++ b/transform/labelfile.go
@@ -0,0 +1,55 @@
+/*
+   Copyright 2020 The Compose Specification Authors.
+
+   Licensed under the Apache License, Version 2.0 (the "License");
+   you may not use this file except in compliance with the License.
+   You may obtain a copy of the License at
+
+       http://www.apache.org/licenses/LICENSE-2.0
+
+   Unless required by applicable law or agreed to in writing, software
+   distributed under the License is distributed on an "AS IS" BASIS,
+   WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+   See the License for the specific language governing permissions and
+   limitations under the License.
+*/
+
+package transform
+
+import (
+	"fmt"
+
+	"github.com/compose-spec/compose-go/v2/tree"
+)
+
+func transformLabelFile(data any, p tree.Path, _ bool) (any, error) {
+	switch v := data.(type) {
+	case string:
+		return []any{
+			transformLabelFileValue(v),
+		}, nil
+	case []any:
+		for i, e := range v {
+			v[i] = transformLabelFileValue(e)
+		}
+		return v, nil
+	default:
+		return nil, fmt.Errorf("%s: invalid type %T for label_file", p, v)
+	}
+}
+
+func transformLabelFileValue(data any) any {
+	switch v := data.(type) {
+	case string:
+		return map[string]any{
+			"path":     v,
+			"required": true,
+		}
+	case map[string]any:
+		if _, ok := v["required"]; !ok {
+			v["required"] = true
+		}
+		return v
+	}
+	return nil
+}
diff --git a/types/derived.gen.go b/types/derived.gen.go
index d33ae280..3f8d92b7 100644
--- a/types/derived.gen.go
+++ b/types/derived.gen.go
@@ -485,6 +485,24 @@ func deriveDeepCopyService(dst, src *ServiceConfig) {
 	} else {
 		dst.Labels = nil
 	}
+	if src.LabelFiles == nil {
+		dst.LabelFiles = nil
+	} else {
+		if dst.LabelFiles != nil {
+			if len(src.LabelFiles) > len(dst.LabelFiles) {
+				if cap(dst.LabelFiles) >= len(src.LabelFiles) {
+					dst.LabelFiles = (dst.LabelFiles)[:len(src.LabelFiles)]
+				} else {
+					dst.LabelFiles = make([]LabelFile, len(src.LabelFiles))
+				}
+			} else if len(src.LabelFiles) < len(dst.LabelFiles) {
+				dst.LabelFiles = (dst.LabelFiles)[:len(src.LabelFiles)]
+			}
+		} else {
+			dst.LabelFiles = make([]LabelFile, len(src.LabelFiles))
+		}
+		copy(dst.LabelFiles, src.LabelFiles)
+	}
 	if src.CustomLabels != nil {
 		dst.CustomLabels = make(map[string]string, len(src.CustomLabels))
 		deriveDeepCopy_4(dst.CustomLabels, src.CustomLabels)
@@ -1428,6 +1446,12 @@ func deriveDeepCopy_24(dst, src *NetworkConfig) {
 	} else {
 		dst.Labels = nil
 	}
+	if src.CustomLabels != nil {
+		dst.CustomLabels = make(map[string]string, len(src.CustomLabels))
+		deriveDeepCopy_4(dst.CustomLabels, src.CustomLabels)
+	} else {
+		dst.CustomLabels = nil
+	}
 	if src.EnableIPv6 == nil {
 		dst.EnableIPv6 = nil
 	} else {
@@ -1459,6 +1483,12 @@ func deriveDeepCopy_25(dst, src *VolumeConfig) {
 	} else {
 		dst.Labels = nil
 	}
+	if src.CustomLabels != nil {
+		dst.CustomLabels = make(map[string]string, len(src.CustomLabels))
+		deriveDeepCopy_4(dst.CustomLabels, src.CustomLabels)
+	} else {
+		dst.CustomLabels = nil
+	}
 	if src.Extensions != nil {
 		dst.Extensions = make(map[string]any, len(src.Extensions))
 		src.Extensions.DeepCopy(dst.Extensions)
diff --git a/types/labelfile.go b/types/labelfile.go
new file mode 100644
index 00000000..ff0980e0
--- /dev/null
+++ b/types/labelfile.go
@@ -0,0 +1,47 @@
+/*
+   Copyright 2020 The Compose Specification Authors.
+
+   Licensed under the Apache License, Version 2.0 (the "License");
+   you may not use this file except in compliance with the License.
+   You may obtain a copy of the License at
+
+       http://www.apache.org/licenses/LICENSE-2.0
+
+   Unless required by applicable law or agreed to in writing, software
+   distributed under the License is distributed on an "AS IS" BASIS,
+   WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+   See the License for the specific language governing permissions and
+   limitations under the License.
+*/
+
+package types
+
+import (
+	"encoding/json"
+)
+
+type LabelFile struct {
+	Path     string `yaml:"path,omitempty" json:"path,omitempty"`
+	Required bool   `yaml:"required" json:"required"`
+	Format   string `yaml:"format,omitempty" json:"format,omitempty"`
+}
+
+// MarshalYAML makes LabelFile implement yaml.Marshaler
+func (e LabelFile) MarshalYAML() (interface{}, error) {
+	if e.Required {
+		return e.Path, nil
+	}
+	return map[string]any{
+		"path":     e.Path,
+		"required": e.Required,
+	}, nil
+}
+
+// MarshalJSON makes LabelFile implement json.Marshaler
+func (e *LabelFile) MarshalJSON() ([]byte, error) {
+	if e.Required {
+		return json.Marshal(e.Path)
+	}
+	// Pass as a value to avoid re-entering this method and use the default implementation
+	return json.Marshal(*e)
+}
diff --git a/types/labels.go b/types/labels.go
index 000476bf..7ea5edc4 100644
--- a/types/labels.go
+++ b/types/labels.go
@@ -24,6 +24,16 @@ import (
 // Labels is a mapping type for labels
 type Labels map[string]string
 
+func NewLabelsFromMappingWithEquals(mapping MappingWithEquals) Labels {
+	labels := Labels{}
+	for k, v := range mapping {
+		if v != nil {
+			labels[k] = *v
+		}
+	}
+	return labels
+}
+
 func (l Labels) Add(key, value string) Labels {
 	if l == nil {
 		l = Labels{}
@@ -42,6 +52,14 @@ func (l Labels) AsList() []string {
 	return s
 }
 
+func (l Labels) ToMappingWithEquals() MappingWithEquals {
+	mapping := MappingWithEquals{}
+	for k, v := range l {
+		mapping[k] = &v
+	}
+	return mapping
+}
+
 // label value can be a string | number | boolean | null (empty)
 func labelValue(e interface{}) string {
 	if e == nil {
diff --git a/types/project.go b/types/project.go
index 19d6e32b..9b8d75c6 100644
--- a/types/project.go
+++ b/types/project.go
@@ -633,6 +633,40 @@ func (p Project) WithServicesEnvironmentResolved(discardEnvFiles bool) (*Project
 	return newProject, nil
 }
 
+// WithServicesLabelsResolved parses label_files set for services to resolve the actual label map for services
+// It returns a new Project instance with the changes and keep the original Project unchanged
+func (p Project) WithServicesLabelsResolved(discardLabelFiles bool) (*Project, error) {
+	newProject := p.deepCopy()
+	for i, service := range newProject.Services {
+		labels := MappingWithEquals{}
+		// resolve variables based on other files we already parsed
+		var resolve dotenv.LookupFn = func(s string) (string, bool) {
+			v, ok := labels[s]
+			if ok && v != nil {
+				return *v, ok
+			}
+			return "", false
+		}
+
+		for _, labelFile := range service.LabelFiles {
+			vars, err := loadLabelFile(labelFile, resolve)
+			if err != nil {
+				return nil, err
+			}
+			labels.OverrideBy(vars.ToMappingWithEquals())
+		}
+
+		labels = labels.OverrideBy(service.Labels.ToMappingWithEquals())
+		service.Labels = NewLabelsFromMappingWithEquals(labels)
+
+		if discardLabelFiles {
+			service.LabelFiles = nil
+		}
+		newProject.Services[i] = service
+	}
+	return newProject, nil
+}
+
 func loadEnvFile(envFile EnvFile, resolve dotenv.LookupFn) (Mapping, error) {
 	if _, err := os.Stat(envFile.Path); os.IsNotExist(err) {
 		if envFile.Required {
@@ -640,15 +674,31 @@ func loadEnvFile(envFile EnvFile, resolve dotenv.LookupFn) (Mapping, error) {
 		}
 		return nil, nil
 	}
-	file, err := os.Open(envFile.Path)
+
+	return loadMappingFile(envFile.Path, envFile.Format, resolve)
+}
+
+func loadLabelFile(labelFile LabelFile, resolve dotenv.LookupFn) (Mapping, error) {
+	if _, err := os.Stat(labelFile.Path); os.IsNotExist(err) {
+		if labelFile.Required {
+			return nil, fmt.Errorf("label file %s not found: %w", labelFile.Path, err)
+		}
+		return nil, nil
+	}
+
+	return loadMappingFile(labelFile.Path, labelFile.Format, resolve)
+}
+
+func loadMappingFile(path string, format string, resolve dotenv.LookupFn) (Mapping, error) {
+	file, err := os.Open(path)
 	if err != nil {
 		return nil, err
 	}
 	defer file.Close() //nolint:errcheck
 
 	var fileVars map[string]string
-	if envFile.Format != "" {
-		fileVars, err = dotenv.ParseWithFormat(file, envFile.Path, resolve, envFile.Format)
+	if format != "" {
+		fileVars, err = dotenv.ParseWithFormat(file, path, resolve, format)
 	} else {
 		fileVars, err = dotenv.ParseWithLookup(file, resolve)
 	}
diff --git a/types/types.go b/types/types.go
index 3cae5390..7be08c30 100644
--- a/types/types.go
+++ b/types/types.go
@@ -89,6 +89,7 @@ type ServiceConfig struct {
 	Ipc             string                           `yaml:"ipc,omitempty" json:"ipc,omitempty"`
 	Isolation       string                           `yaml:"isolation,omitempty" json:"isolation,omitempty"`
 	Labels          Labels                           `yaml:"labels,omitempty" json:"labels,omitempty"`
+	LabelFiles      []LabelFile                      `yaml:"label_file,omitempty" json:"label_file,omitempty"`
 	CustomLabels    Labels                           `yaml:"-" json:"-"`
 	Links           []string                         `yaml:"links,omitempty" json:"links,omitempty"`
 	Logging         *LoggingConfig                   `yaml:"logging,omitempty" json:"logging,omitempty"`