diff --git a/.chloggen/headersetter_default_value.yaml b/.chloggen/headersetter_default_value.yaml
new file mode 100644
index 000000000000..644b8d56553a
--- /dev/null
+++ b/.chloggen/headersetter_default_value.yaml
@@ -0,0 +1,28 @@
+# Use this changelog template to create an entry for release notes.
+
+# One of 'breaking', 'deprecation', 'new_component', 'enhancement', 'bug_fix'
+change_type: enhancement
+
+# The name of the component, or a single word describing the area of concern, (e.g. filelogreceiver)
+component: headersetterextension
+
+# A brief description of the change.  Surround your text with quotes ("") if it needs to start with a backtick (`).
+note: adding default_value config
+
+# Mandatory: One or more tracking issues related to the change. You can use the PR number here if no issue exists.
+issues: [34412]
+
+# (Optional) One or more lines of additional information to render under the primary note.
+# These lines will be padded with 2 spaces and then inserted directly into the document.
+# Use pipe (|) for multiline entries.
+subtext: |
+  default_value config item applied in case context value is empty
+
+# If your change doesn't affect end users or the exported elements of any package,
+# you should instead start your pull request title with [chore] or use the "Skip Changelog" label.
+# Optional: The change log or logs in which this entry should be included.
+# e.g. '[user]' or '[user, api]'
+# Include 'user' if the change is relevant to end users.
+# Include 'api' if there is a change to a library API.
+# Default: '[user]'
+change_logs: [user]
diff --git a/extension/headerssetterextension/README.md b/extension/headerssetterextension/README.md
index 98fb3d5e93a9..7cbaf3383c84 100644
--- a/extension/headerssetterextension/README.md
+++ b/extension/headerssetterextension/README.md
@@ -34,11 +34,12 @@ The following settings are required:
         - `delete`: Deletes the header.
     - `value`: The header value is looked up from the `value` property of the
       extension configuration.
+    - `default_value`: (Optional) Value used if no entry for header key specified in `from_context` is present in request metadata.
     - `from_context`: The header value is looked up from the request metadata,
       such as HTTP headers, using the property value as the key (likely a header
       name).
 
-The `value` and `from_context` properties are mutually exclusive.
+The `value` and `from_context,default_value` properties are mutually exclusive.
 
 In order for `from_context` to work, other components in the pipeline also need to be configured appropriately:
 * If a [batch processor][batch-processor] is present in the pipeline, it must be configured to [preserve client metadata][batch-processor-preserve-metadata]. 
@@ -54,6 +55,7 @@ extensions:
       - action: insert
         key: X-Scope-OrgID
         from_context: tenant_id
+        default_value: Org-ID
       - action: upsert
         key: User-ID
         value: user_id
diff --git a/extension/headerssetterextension/config.go b/extension/headerssetterextension/config.go
index 73c688939c3b..55fe9cb07d1e 100644
--- a/extension/headerssetterextension/config.go
+++ b/extension/headerssetterextension/config.go
@@ -19,10 +19,11 @@ type Config struct {
 }
 
 type HeaderConfig struct {
-	Action      ActionValue `mapstructure:"action"`
-	Key         *string     `mapstructure:"key"`
-	Value       *string     `mapstructure:"value"`
-	FromContext *string     `mapstructure:"from_context"`
+	Action       ActionValue `mapstructure:"action"`
+	Key          *string     `mapstructure:"key"`
+	Value        *string     `mapstructure:"value"`
+	FromContext  *string     `mapstructure:"from_context"`
+	DefaultValue *string     `mapstructure:"default_value"`
 }
 
 // ActionValue is the enum to capture the four types of actions to perform on a header
diff --git a/extension/headerssetterextension/config_test.go b/extension/headerssetterextension/config_test.go
index 11ae3b04ab79..188d116898a5 100644
--- a/extension/headerssetterextension/config_test.go
+++ b/extension/headerssetterextension/config_test.go
@@ -36,6 +36,12 @@ func TestLoadConfig(t *testing.T) {
 						Action:      INSERT,
 						FromContext: stringp("tenant_id"),
 						Value:       nil,
+					}, {
+						Key:          stringp("X-Scope-OrgID"),
+						Action:       INSERT,
+						FromContext:  stringp("tenant_id"),
+						DefaultValue: stringp("some_id"),
+						Value:        nil,
 					},
 					{
 						Key:         stringp("User-ID"),
@@ -148,6 +154,18 @@ func TestValidateConfig(t *testing.T) {
 			},
 			errMissingSource,
 		},
+		{
+			"header value source is missing snd default value set",
+			[]HeaderConfig{
+				{
+					Key:          stringp("name"),
+					Action:       INSERT,
+					FromContext:  stringp("from context"),
+					DefaultValue: stringp("default"),
+				},
+			},
+			nil,
+		},
 		{
 			"delete header action",
 			[]HeaderConfig{
diff --git a/extension/headerssetterextension/extension.go b/extension/headerssetterextension/extension.go
index ae2c0afbb752..c49588987f95 100644
--- a/extension/headerssetterextension/extension.go
+++ b/extension/headerssetterextension/extension.go
@@ -35,8 +35,13 @@ func newHeadersSetterExtension(cfg *Config, logger *zap.Logger) (auth.Client, er
 				Value: *header.Value,
 			}
 		} else if header.FromContext != nil {
+			var defaultValue = ""
+			if header.DefaultValue != nil {
+				defaultValue = *header.DefaultValue
+			}
 			s = &source.ContextSource{
-				Key: *header.FromContext,
+				Key:          *header.FromContext,
+				DefaultValue: defaultValue,
 			}
 		}
 
diff --git a/extension/headerssetterextension/extension_test.go b/extension/headerssetterextension/extension_test.go
index 409bfd70829e..e43619066b8a 100644
--- a/extension/headerssetterextension/extension_test.go
+++ b/extension/headerssetterextension/extension_test.go
@@ -218,6 +218,42 @@ var (
 				"header_name": "",
 			},
 		},
+		{
+			cfg: &Config{
+				HeadersConfig: []HeaderConfig{
+					{
+						Key:          &header,
+						Action:       INSERT,
+						FromContext:  stringp("tenant"),
+						DefaultValue: stringp("default_tenant"),
+					},
+				},
+			},
+			metadata: client.NewMetadata(
+				map[string][]string{},
+			),
+			expectedHeaders: map[string]string{
+				"header_name": "default_tenant",
+			},
+		},
+		{
+			cfg: &Config{
+				HeadersConfig: []HeaderConfig{
+					{
+						Key:          &header,
+						Action:       INSERT,
+						FromContext:  stringp("tenant"),
+						DefaultValue: stringp("default_tenant"),
+					},
+				},
+			},
+			metadata: client.NewMetadata(
+				map[string][]string{"tenant": {"acme"}},
+			),
+			expectedHeaders: map[string]string{
+				"header_name": "acme",
+			},
+		},
 	}
 )
 
diff --git a/extension/headerssetterextension/internal/source/context.go b/extension/headerssetterextension/internal/source/context.go
index 7cd40b7dadb2..20b15fb2f7eb 100644
--- a/extension/headerssetterextension/internal/source/context.go
+++ b/extension/headerssetterextension/internal/source/context.go
@@ -13,7 +13,8 @@ import (
 var _ Source = (*ContextSource)(nil)
 
 type ContextSource struct {
-	Key string
+	Key          string
+	DefaultValue string
 }
 
 func (ts *ContextSource) Get(ctx context.Context) (string, error) {
@@ -21,7 +22,7 @@ func (ts *ContextSource) Get(ctx context.Context) (string, error) {
 	ss := cl.Metadata.Get(ts.Key)
 
 	if len(ss) == 0 {
-		return "", nil
+		return ts.DefaultValue, nil
 	}
 
 	if len(ss) > 1 {
diff --git a/extension/headerssetterextension/testdata/config.yaml b/extension/headerssetterextension/testdata/config.yaml
index 05dfe5403773..4762f609d97f 100644
--- a/extension/headerssetterextension/testdata/config.yaml
+++ b/extension/headerssetterextension/testdata/config.yaml
@@ -4,6 +4,10 @@ headers_setter/1:
     - key: X-Scope-OrgID
       action: insert
       from_context: "tenant_id"
+    - key: X-Scope-OrgID
+      action: insert
+      from_context: "tenant_id"
+      default_value: "some_id"
     - key: User-ID
       action: update
       from_context: "user_id"