diff --git a/pkg/flags/flags.go b/pkg/flags/flags.go
index 2fe7bb563c..97db3fb1df 100644
--- a/pkg/flags/flags.go
+++ b/pkg/flags/flags.go
@@ -113,6 +113,7 @@ var (
 		EnableL4ILBDualStack           bool
 		EnableL4NetLBDualStack         bool
 		EnableMultipleIGs              bool
+		EnableDegradedMode             bool
 		MaxIGSize                      int
 	}{
 		GCERateLimitScale: 1.0,
@@ -260,6 +261,8 @@ L7 load balancing. CSV values accepted. Example: -node-port-ranges=80,8080,400-5
 	flag.IntVar(&F.MaxIGSize, "max-ig-size", 1000, "Max number of instances in Instance Group")
 	flag.DurationVar(&F.MetricsExportInterval, "metrics-export-interval", 10*time.Minute, `Period for calculating and exporting metrics related to state of managed objects.`)
 	flag.DurationVar(&F.NegMetricsExportInterval, "neg-metrics-export-interval", 5*time.Second, `Period for calculating and exporting internal neg controller metrics, not usage.`)
+	flag.BoolVar(&F.EnableDegradedMode, "enable-degraded-mode", false, `Enable endpoint calculation using degraded mode`)
+
 }
 
 type RateLimitSpecs struct {
diff --git a/pkg/neg/syncers/transaction.go b/pkg/neg/syncers/transaction.go
index 46db61b1fd..6cf8f394ca 100644
--- a/pkg/neg/syncers/transaction.go
+++ b/pkg/neg/syncers/transaction.go
@@ -21,6 +21,7 @@ import (
 	"errors"
 	"fmt"
 	"net/http"
+	"strconv"
 	"strings"
 	"sync"
 	"time"
@@ -104,6 +105,9 @@ type transactionSyncer struct {
 
 	// syncCollector collect sync related metrics
 	syncCollector metrics.SyncerMetricsCollector
+
+	// enableDegradedMode indicates whether we do endpoint calculations in degraded mode
+	enableDegradedMode bool
 }
 
 func NewTransactionSyncer(
@@ -260,9 +264,16 @@ func (s *transactionSyncer) syncInternalImpl() *negtypes.NegSyncResult {
 		s.logger.V(3).Info("Endpoint slice syncs", "Namespace", endpointslice.Namespace, "Name", endpointslice.Name, "staleness", epsStaleness)
 
 	}
-	targetMap, endpointPodMap, result = s.computeTargetMap(endpointSlices)
-	if result != nil {
-		return result
+	if s.enableDegradedMode {
+		targetMap, endpointPodMap, result = s.computeTargetMapDegradedMode(endpointSlices, s.NegSyncerKey.PortTuple.Name, s.NegSyncerKey.NegType)
+		if result != nil {
+			return result
+		}
+	} else {
+		targetMap, endpointPodMap, result = s.computeTargetMap(endpointSlices)
+		if result != nil {
+			return result
+		}
 	}
 
 	s.logStats(targetMap, "desired NEG endpoints")
@@ -316,6 +327,43 @@ func (s *transactionSyncer) computeTargetMap(endpointSlices []*discovery.Endpoin
 	return targetMap, endpointPodMap, result
 }
 
+// computeTargetMapDegradedMode does endpoint calculation differently
+// to fix the error in NEG controller and return the desire map
+func (s *transactionSyncer) computeTargetMapDegradedMode(slices []*discovery.EndpointSlice, servicePortName string, endpointType negtypes.NetworkEndpointType) (map[string]negtypes.NetworkEndpointSet, negtypes.EndpointPodMap, *negtypes.NegSyncResult) {
+	var targetMap map[string]negtypes.NetworkEndpointSet
+	var endpointPodMap negtypes.EndpointPodMap
+
+	for _, slice := range slices {
+		// if it is a custom endpoint slice, don't include it
+		// so it won't block the neg api call from succeeding
+		if val, ok := slice.ObjectMeta.Labels[discovery.LabelManagedBy]; !ok || val != "endpointslice-controller.k8s.io" {
+			continue
+		}
+		matchPort := ""
+		for _, port := range slice.Ports {
+			if *port.Name == servicePortName {
+				matchPort = strconv.Itoa(int(*port.Port))
+				break
+			}
+		}
+		if len(matchPort) == 0 {
+			continue
+		}
+
+		for _, ep := range slice.Endpoints {
+			if ep.TargetRef == nil {
+				continue
+			}
+			s.validateAndAddEndpoints(ep, matchPort, endpointType, targetMap, endpointPodMap)
+		}
+	}
+	return targetMap, endpointPodMap, nil
+}
+
+// validateAndAddEndpoints fills in missing information and creates network endpoint for each endpoint addresss
+func (s *transactionSyncer) validateAndAddEndpoints(ep discovery.Endpoint, matchPort string, endpointType negtypes.NetworkEndpointType, targetMap map[string]negtypes.NetworkEndpointSet, endpointPodMap negtypes.EndpointPodMap) {
+}
+
 // syncLock must already be acquired before execution
 func (s *transactionSyncer) inErrorState() bool {
 	return s.errorState != ""