diff --git a/api/v1/inferencepool_types.go b/api/v1/inferencepool_types.go
index f53781675..c9025bf87 100644
--- a/api/v1/inferencepool_types.go
+++ b/api/v1/inferencepool_types.go
@@ -130,7 +130,8 @@ type EndpointPickerRef struct {
 	//
 	// +optional
 	// +kubebuilder:default="FailClose"
-	FailureMode ExtensionFailureMode `json:"failureMode,omitempty"`
+	//nolint:kubeapilinter // ignore kubeapilinter here as we want to use pointer here for optional struct.
+	FailureMode *ExtensionFailureMode `json:"failureMode,omitempty"`
 }
 
 // ExtensionFailureMode defines the options for how the gateway handles the case when the extension is not
diff --git a/api/v1/zz_generated.deepcopy.go b/api/v1/zz_generated.deepcopy.go
index 9e90d369f..ffb355bb9 100644
--- a/api/v1/zz_generated.deepcopy.go
+++ b/api/v1/zz_generated.deepcopy.go
@@ -38,6 +38,11 @@ func (in *EndpointPickerRef) DeepCopyInto(out *EndpointPickerRef) {
 		*out = new(PortNumber)
 		**out = **in
 	}
+	if in.FailureMode != nil {
+		in, out := &in.FailureMode, &out.FailureMode
+		*out = new(ExtensionFailureMode)
+		**out = **in
+	}
 }
 
 // DeepCopy is an autogenerated deepcopy function, copying the receiver, creating a new EndpointPickerRef.
diff --git a/apix/v1alpha2/inferencepool_conversion.go b/apix/v1alpha2/inferencepool_conversion.go
index b817c47d5..40a89d620 100644
--- a/apix/v1alpha2/inferencepool_conversion.go
+++ b/apix/v1alpha2/inferencepool_conversion.go
@@ -120,7 +120,8 @@ func convertExtensionRefToV1(src *Extension) (v1.EndpointPickerRef, error) {
 		endpointPickerRef.PortNumber = &v1PortNumber
 	}
 	if src.FailureMode != nil {
-		endpointPickerRef.FailureMode = v1.ExtensionFailureMode(*src.FailureMode)
+		v1FailureMode := v1.ExtensionFailureMode(*src.FailureMode)
+		endpointPickerRef.FailureMode = &v1FailureMode
 	}
 
 	return endpointPickerRef, nil
@@ -144,8 +145,8 @@ func convertEndpointPickerRefFromV1(src *v1.EndpointPickerRef) (Extension, error
 		portNumber := PortNumber(*src.PortNumber)
 		extension.PortNumber = &portNumber
 	}
-	if src.FailureMode != "" {
-		extensionFailureMode := ExtensionFailureMode(src.FailureMode)
+	if src.FailureMode != nil {
+		extensionFailureMode := ExtensionFailureMode(*src.FailureMode)
 		extension.FailureMode = &extensionFailureMode
 	}
 	return extension, nil
diff --git a/apix/v1alpha2/inferencepool_conversion_test.go b/apix/v1alpha2/inferencepool_conversion_test.go
index 2c59fc632..5da8b4eb6 100644
--- a/apix/v1alpha2/inferencepool_conversion_test.go
+++ b/apix/v1alpha2/inferencepool_conversion_test.go
@@ -105,7 +105,7 @@ func TestInferencePoolConvertTo(t *testing.T) {
 						Kind:        v1Kind,
 						Name:        "my-epp-service",
 						PortNumber:  &v1PortNumber,
-						FailureMode: v1FailureMode,
+						FailureMode: &v1FailureMode,
 					},
 				},
 				Status: v1.InferencePoolStatus{
@@ -240,7 +240,7 @@ func TestInferencePoolConvertFrom(t *testing.T) {
 						Kind:        v1Kind,
 						Name:        "my-epp-service",
 						PortNumber:  &v1PortNumber,
-						FailureMode: v1FailureMode,
+						FailureMode: &v1FailureMode,
 					},
 				},
 				Status: v1.InferencePoolStatus{