diff --git a/sdk/monitor/azure-monitor-opentelemetry-exporter/CHANGELOG.md b/sdk/monitor/azure-monitor-opentelemetry-exporter/CHANGELOG.md
index 5ea624ceb339..905a8101f2bc 100644
--- a/sdk/monitor/azure-monitor-opentelemetry-exporter/CHANGELOG.md
+++ b/sdk/monitor/azure-monitor-opentelemetry-exporter/CHANGELOG.md
@@ -10,6 +10,8 @@
 
 ### Other Changes
 
+- Support AI Foundry by Handling GEN_AI_SYSTEM Attributes with [Spec](https://github.com/aep-health-and-standards/Telemetry-Collection-Spec/blob/main/ApplicationInsights/genai_semconv_mapping.md) ([#41705](https://github.com/Azure/azure-sdk-for-python/pull/41705))
+
 ## 1.0.0b39 (2025-06-25)
 
 ### Bugs Fixed
diff --git a/sdk/monitor/azure-monitor-opentelemetry-exporter/azure/monitor/opentelemetry/exporter/export/trace/_exporter.py b/sdk/monitor/azure-monitor-opentelemetry-exporter/azure/monitor/opentelemetry/exporter/export/trace/_exporter.py
index b0643499c978..206d0b2dd064 100644
--- a/sdk/monitor/azure-monitor-opentelemetry-exporter/azure/monitor/opentelemetry/exporter/export/trace/_exporter.py
+++ b/sdk/monitor/azure-monitor-opentelemetry-exporter/azure/monitor/opentelemetry/exporter/export/trace/_exporter.py
@@ -96,6 +96,8 @@
     _SAMPLE_RATE_KEY,
 ]
 
+_GEN_AI_ATTRIBUTE_PREFIX = "GenAI | {}"
+
 
 class AzureMonitorTraceExporter(BaseExporter, SpanExporter):
     """Azure Monitor Trace exporter for OpenTelemetry."""
@@ -333,6 +335,13 @@ def _convert_span_to_envelope(span: ReadableSpan) -> TelemetryItem:
         envelope.data = MonitorBase(base_data=data, base_type="RemoteDependencyData")
         target = trace_utils._get_target_for_dependency_from_peer(span.attributes)
         if span.kind is SpanKind.CLIENT:
+            gen_ai_attributes_val = ""
+             # gen_ai take precedence over other mappings (ex. HTTP) even if their attributes are also present on the span.
+             # following mappings will override the type
+            if gen_ai_attributes.GEN_AI_SYSTEM in span.attributes:  # GenAI
+                gen_ai_attributes_val = span.attributes[gen_ai_attributes.GEN_AI_SYSTEM]
+                if gen_ai_attributes_val:
+                    data.type = _GEN_AI_ATTRIBUTE_PREFIX.format(gen_ai_attributes_val)
             if _AZURE_SDK_NAMESPACE_NAME in span.attributes:  # Azure specific resources
                 # Currently only eventhub and servicebus are supported
                 # https://github.com/Azure/azure-sdk-for-python/issues/9256
@@ -406,10 +415,12 @@ def _convert_span_to_envelope(span: ReadableSpan) -> TelemetryItem:
                     target,  # type: ignore
                     span.attributes,
                 )
-            elif gen_ai_attributes.GEN_AI_SYSTEM in span.attributes:  # GenAI
-                data.type = span.attributes[gen_ai_attributes.GEN_AI_SYSTEM]
             else:
                 data.type = "N/A"
+            
+            # If no fields are available to set target using standard rules, set Dependency Target to gen_ai.system if present
+            if not target and gen_ai_attributes_val:
+                target = gen_ai_attributes_val
         elif span.kind is SpanKind.PRODUCER:  # Messaging
             # Currently only eventhub and servicebus are supported that produce PRODUCER spans
             if _AZURE_SDK_NAMESPACE_NAME in span.attributes:
@@ -426,7 +437,9 @@ def _convert_span_to_envelope(span: ReadableSpan) -> TelemetryItem:
                 )
         else:  # SpanKind.INTERNAL
             data.type = "InProc"
-            if _AZURE_SDK_NAMESPACE_NAME in span.attributes:
+            if gen_ai_attributes.GEN_AI_SYSTEM in span.attributes:  # GenAI
+                data.type = _GEN_AI_ATTRIBUTE_PREFIX.format(span.attributes[gen_ai_attributes.GEN_AI_SYSTEM])
+            elif _AZURE_SDK_NAMESPACE_NAME in span.attributes:
                 data.type += " | {}".format(span.attributes[_AZURE_SDK_NAMESPACE_NAME])
         # Apply truncation
         # See https://github.com/MohanGsk/ApplicationInsights-Home/tree/master/EndpointSpecs/Schemas/Bond
diff --git a/sdk/monitor/azure-monitor-opentelemetry-exporter/tests/trace/test_trace.py b/sdk/monitor/azure-monitor-opentelemetry-exporter/tests/trace/test_trace.py
index 8ebe8b221a03..d90eacc3a0ef 100644
--- a/sdk/monitor/azure-monitor-opentelemetry-exporter/tests/trace/test_trace.py
+++ b/sdk/monitor/azure-monitor-opentelemetry-exporter/tests/trace/test_trace.py
@@ -438,6 +438,24 @@ def test_span_to_envelope_client_http(self):
         envelope = exporter._span_to_envelope(span)
         self.assertEqual(envelope.data.base_data.target, "www.example.com")
 
+        span._attributes = {
+            "http.request.method": "GET",
+            "gen_ai.system": "az.ai.inference"
+        }
+        envelope = exporter._span_to_envelope(span)
+        self.assertEqual(envelope.data.base_data.target, "az.ai.inference")
+        self.assertEqual(envelope.data.base_data.name, "GET /")
+
+        span._attributes = {
+            "http.request.method": "GET",
+            "server.address": "www.example.com",
+            "server.port": 80,
+            "url.scheme": "http",
+            "gen_ai.system": "az.ai.inference"
+        }
+        envelope = exporter._span_to_envelope(span)
+        self.assertEqual(envelope.data.base_data.target, "www.example.com")
+
         # url
         # spell-checker:ignore ddds
         span._attributes = {
@@ -760,8 +778,57 @@ def test_span_to_envelope_client_gen_ai(self):
         self.assertEqual(envelope.data.base_data.result_code, "0")
 
         self.assertEqual(envelope.data.base_type, "RemoteDependencyData")
-        self.assertEqual(envelope.data.base_data.type, "az.ai.inference")
+        self.assertEqual(envelope.data.base_data.type, "N/A")
         self.assertEqual(len(envelope.data.base_data.properties), 1)
+        
+    def test_span_to_envelope_client_internal_gen_ai_type(self):
+        exporter = self._exporter
+        start_time = 1575494316027613500
+        end_time = start_time + 1001000000
+
+        span = trace._Span(
+            name="test",
+            context=SpanContext(
+                trace_id=36873507687745823477771305566750195431,
+                span_id=12030755672171557337,
+                is_remote=False,
+            ),
+            attributes={
+                "gen_ai.system": "az.ai.inference",
+            },
+            kind=SpanKind.INTERNAL,
+        )
+        span.start(start_time=start_time)
+        span.end(end_time=end_time)
+        span._status = Status(status_code=StatusCode.UNSET)
+        envelope = exporter._span_to_envelope(span)
+
+        self.assertEqual(envelope.data.base_data.type, "GenAI | az.ai.inference")
+    
+    def test_span_to_envelope_client_mutiple_types_with_gen_ai(self):
+        exporter = self._exporter
+        start_time = 1575494316027613500
+        end_time = start_time + 1001000000
+
+        span = trace._Span(
+            name="test",
+            context=SpanContext(
+                trace_id=36873507687745823477771305566750195431,
+                span_id=12030755672171557337,
+                is_remote=False,
+            ),
+            attributes={
+                "gen_ai.system": "az.ai.inference",
+                "az.namespace": "Microsoft.EventHub",
+            },
+            kind=SpanKind.INTERNAL,
+        )
+        span.start(start_time=start_time)
+        span.end(end_time=end_time)
+        span._status = Status(status_code=StatusCode.UNSET)
+        envelope = exporter._span_to_envelope(span)
+
+        self.assertEqual(envelope.data.base_data.type, "GenAI | az.ai.inference")
 
     def test_span_to_envelope_client_azure(self):
         exporter = self._exporter