diff --git a/ovn/controller/binding.c b/ovn/controller/binding.c
index 95e9deb..f96127c 100644
--- a/ovn/controller/binding.c
+++ b/ovn/controller/binding.c
@@ -352,6 +352,43 @@ setup_qos(const char *egress_iface, struct hmap *queue_map)
     hmap_destroy(&consistent_queues);
     netdev_close(netdev_phy);
 }
+static bool
+set_ovsport_external_ids(struct controller_ctx *ctx,
+                         const struct ovsrec_bridge *bridge,
+                         const struct ovsrec_interface *iface_rec,
+                         const char *key,
+                         const char *value)
+{
+    if (!ctx->ovs_idl_txn) {
+        return false;
+    }
+
+    /* Find the port with this interface and add the key/value pair to its
+     * external_ids. Assume 1-1 relationship between port and interface. */
+    int i;
+    for (i = 0; i < bridge->n_ports; i++) {
+        const struct ovsrec_port *port_rec = bridge->ports[i];
+        int j;
+
+        if (!strcmp(port_rec->name, bridge->name)) {
+            continue;
+        }
+
+        for (j = 0; j < port_rec->n_interfaces; j++) {
+            if (port_rec->interfaces[j] == iface_rec) {
+                struct smap new_ids;
+                smap_clone(&new_ids, &port_rec->external_ids);
+                smap_replace(&new_ids, key, value);
+                ovsrec_port_verify_external_ids(port_rec);
+                ovsrec_port_set_external_ids(port_rec, &new_ids);
+                smap_destroy(&new_ids);
+                return true;
+            }
+        }
+    }
+    return false;
+}
+
 
 static void
 consider_local_datapath(struct controller_ctx *ctx,
@@ -359,6 +396,7 @@ consider_local_datapath(struct controller_ctx *ctx,
                         const struct lport_index *lports,
                         const struct sbrec_chassis *chassis_rec,
                         const struct sbrec_port_binding *binding_rec,
+                        const struct ovsrec_bridge *bridge,
                         struct hmap *qos_map,
                         struct hmap *local_datapaths,
                         struct shash *lport_to_iface,
@@ -368,19 +406,40 @@ consider_local_datapath(struct controller_ctx *ctx,
         = shash_find_data(lport_to_iface, binding_rec->logical_port);
 
     bool our_chassis = false;
-    if (iface_rec
-        || (binding_rec->parent_port && binding_rec->parent_port[0] &&
-            sset_contains(local_lports, binding_rec->parent_port))) {
-        if (binding_rec->parent_port && binding_rec->parent_port[0]) {
-            /* Add child logical port to the set of all local ports. */
-            sset_add(local_lports, binding_rec->logical_port);
-        }
-        add_local_datapath(ldatapaths, lports, binding_rec->datapath,
-                           false, local_datapaths);
-        if (iface_rec && qos_map && ctx->ovs_idl_txn) {
-            get_qos_params(binding_rec, qos_map);
+
+    if (iface_rec && !strcmp(binding_rec->type, "localport")) {
+        /* Make sure localport external_id is present, otherwise set it
+         * for both interface and port. This should only happen the first
+         * time. We set the value on both the interface and port because it's
+         * most convenient to check for the value here on the interface. Later,
+         * we need to read this value in physical.c, and expect to read it from
+         * the port there.*/
+        if (!smap_get(&iface_rec->external_ids, "ovn-localport-port")) {
+            if (set_ovsport_external_ids(ctx, bridge, iface_rec,
+                                         "ovn-localport-port",
+                                         binding_rec->logical_port)) {
+                struct smap new_ids;
+                smap_clone(&new_ids, &iface_rec->external_ids);
+                smap_replace(&new_ids, "ovn-localport-port",
+                             binding_rec->logical_port);
+                ovsrec_interface_verify_external_ids(iface_rec);
+                ovsrec_interface_set_external_ids(iface_rec, &new_ids);
+                smap_destroy(&new_ids);
+            }
         }
-        our_chassis = true;
+    } else if (iface_rec
+               || (binding_rec->parent_port && binding_rec->parent_port[0] &&
+                   sset_contains(local_lports, binding_rec->parent_port))) {
+               if (binding_rec->parent_port && binding_rec->parent_port[0]) {
+                   /* Add child logical port to the set of all local ports. */
+                   sset_add(local_lports, binding_rec->logical_port);
+               }
+               add_local_datapath(ldatapaths, lports, binding_rec->datapath,
+                                  false, local_datapaths);
+               if (iface_rec && qos_map && ctx->ovs_idl_txn) {
+                   get_qos_params(binding_rec, qos_map);
+               }
+               our_chassis = true;
     } else if (!strcmp(binding_rec->type, "l2gateway")) {
         const char *chassis_id = smap_get(&binding_rec->options,
                                           "l2gateway-chassis");
@@ -468,8 +527,8 @@ binding_run(struct controller_ctx *ctx, const struct ovsrec_bridge *br_int,
         consider_local_datapath(ctx, ldatapaths, lports,
                                 chassis_rec, binding_rec,
                                 sset_is_empty(&egress_ifaces) ? NULL :
-                                &qos_map, local_datapaths, &lport_to_iface,
-                                local_lports);
+                                br_int, &qos_map, local_datapaths,
+                                &lport_to_iface, local_lports);
 
     }
 
diff --git a/ovn/controller/physical.c b/ovn/controller/physical.c
index 0f1aa63..a64ac4b 100644
--- a/ovn/controller/physical.c
+++ b/ovn/controller/physical.c
@@ -59,6 +59,8 @@ physical_register_ovs_idl(struct ovsdb_idl *ovs_idl)
 static struct simap localvif_to_ofport =
     SIMAP_INITIALIZER(&localvif_to_ofport);
 static struct hmap tunnels = HMAP_INITIALIZER(&tunnels);
+static struct simap localport_to_ofport =
+    SIMAP_INITIALIZER(&localport_to_ofport);
 
 /* Maps from a chassis to the OpenFlow port number of the tunnel that can be
  * used to reach that chassis. */
@@ -601,6 +603,27 @@ consider_port_binding(enum mf_field_id mff_ovn_geneve,
     } else {
         /* Remote port connected by tunnel */
 
+        /* Table 32, priority 150.
+         * =======================
+         *
+         * Drop traffic originated from a localport to a remote destination.
+         */
+        struct simap_node *localport;
+        SIMAP_FOR_EACH (localport, &localport_to_ofport) {
+            int inport;
+            if ((inport = simap_get(&localport_to_ofport, localport->name))) {
+                match_init_catchall(&match);
+                ofpbuf_clear(ofpacts_p);
+                /* Match localport in_port. */
+                match_set_in_port(&match, inport);
+                /* Match MFF_LOG_DATAPATH, MFF_LOG_OUTPORT. */
+                match_set_metadata(&match, htonll(dp_key));
+                match_set_reg(&match, MFF_LOG_OUTPORT - MFF_REG0, port_key);
+                ofctrl_add_flow(flow_table, OFTABLE_REMOTE_OUTPUT, 150, 0,
+                                &match, ofpacts_p);
+            }
+        }
+
         /* Table 32, priority 100.
          * =======================
          *
@@ -768,6 +791,9 @@ physical_run(struct controller_ctx *ctx, enum mf_field_id mff_ovn_geneve,
         SIMAP_INITIALIZER(&new_localvif_to_ofport);
     struct simap new_tunnel_to_ofport =
         SIMAP_INITIALIZER(&new_tunnel_to_ofport);
+     struct simap new_localport_to_ofport =
+        SIMAP_INITIALIZER(&new_localport_to_ofport);
+
     for (int i = 0; i < br_int->n_ports; i++) {
         const struct ovsrec_port *port_rec = br_int->ports[i];
         if (!strcmp(port_rec->name, br_int->name)) {
@@ -784,6 +810,8 @@ physical_run(struct controller_ctx *ctx, enum mf_field_id mff_ovn_geneve,
                                         "ovn-localnet-port");
         const char *l2gateway = smap_get(&port_rec->external_ids,
                                         "ovn-l2gateway-port");
+        const char *localport = smap_get(&port_rec->external_ids,
+                                         "ovn-localport-port");
 
         for (int j = 0; j < port_rec->n_interfaces; j++) {
             const struct ovsrec_interface *iface_rec = port_rec->interfaces[j];
@@ -848,6 +876,9 @@ physical_run(struct controller_ctx *ctx, enum mf_field_id mff_ovn_geneve,
                                                 "iface-id");
                 if (iface_id) {
                     simap_put(&new_localvif_to_ofport, iface_id, ofport);
+                    if (localport) {
+                        simap_put(&new_localport_to_ofport, localport, ofport);
+                    }
                 }
             }
         }
@@ -884,6 +915,27 @@ physical_run(struct controller_ctx *ctx, enum mf_field_id mff_ovn_geneve,
             physical_map_changed = true;
         }
     }
+
+    /* Do the same for all localports. */
+    SIMAP_FOR_EACH_SAFE (vif_name, vif_name_next, &localport_to_ofport) {
+        int newport;
+        if ((newport = simap_get(&new_localport_to_ofport, vif_name->name))) {
+            if (newport != simap_get(&localport_to_ofport, vif_name->name)) {
+                simap_put(&localport_to_ofport, vif_name->name, newport);
+                physical_map_changed = true;
+            }
+        } else {
+            simap_find_and_delete(&localport_to_ofport, vif_name->name);
+            physical_map_changed = true;
+        }
+    }
+    SIMAP_FOR_EACH (vif_name, &new_localport_to_ofport) {
+        if (!simap_get(&localport_to_ofport, vif_name->name)) {
+            simap_put(&localport_to_ofport, vif_name->name,
+                      simap_get(&new_localport_to_ofport, vif_name->name));
+            physical_map_changed = true;
+        }
+    }
     if (physical_map_changed) {
         /* Reprocess logical flow table immediately. */
         poll_immediate_wake();
@@ -1043,4 +1095,5 @@ physical_run(struct controller_ctx *ctx, enum mf_field_id mff_ovn_geneve,
 
     simap_destroy(&new_localvif_to_ofport);
     simap_destroy(&new_tunnel_to_ofport);
+    simap_destroy(&new_localport_to_ofport);
 }
diff --git a/ovn/northd/ovn-northd.8.xml b/ovn/northd/ovn-northd.8.xml
index ab8fd88..db28736 100644
--- a/ovn/northd/ovn-northd.8.xml
+++ b/ovn/northd/ovn-northd.8.xml
@@ -521,8 +521,8 @@ output;
         </pre>
 
         <p>
-          These flows are omitted for logical ports (other than router ports)
-          that are down.
+            These flows are omitted for logical ports (other than router ports
+            or <code>localport</code> ports) that are down.
         </p>
       </li>
 
diff --git a/ovn/northd/ovn-northd.c b/ovn/northd/ovn-northd.c
index 5a2e5ab..09f55c8 100644
--- a/ovn/northd/ovn-northd.c
+++ b/ovn/northd/ovn-northd.c
@@ -3166,9 +3166,11 @@ build_lswitch_flows(struct hmap *datapaths, struct hmap *ports,
         /*
          * Add ARP/ND reply flows if either the
          *  - port is up or
-         *  - port type is router
+         *  - port type is router or
+         *  - port type is localport
          */
-        if (!lsp_is_up(op->nbsp) && strcmp(op->nbsp->type, "router")) {
+        if (!lsp_is_up(op->nbsp) && strcmp(op->nbsp->type, "router") &&
+            strcmp(op->nbsp->type, "localport")) {
             continue;
         }
 
diff --git a/ovn/ovn-architecture.7.xml b/ovn/ovn-architecture.7.xml
index d8114f1..2866666 100644
--- a/ovn/ovn-architecture.7.xml
+++ b/ovn/ovn-architecture.7.xml
@@ -409,6 +409,15 @@
           logical patch ports at each such point of connectivity, one on
           each side.
         </li>
+        <li>
+          <dfn>Localport ports</dfn> represent the points of local
+          connectivity between logical switches and VIFs. These ports are
+          present in every chassis (not bound to any particular one) and
+          traffic from them will never go through a tunnel. A
+          <code>localport</code> is expected to only generate traffic destined
+          for a local destination, typically in response to a request it
+          received.
+        </li>
       </ul>
     </li>
   </ul>
@@ -986,11 +995,12 @@
         hypervisor.  Each flow's actions implement sending a packet to the port
         it matches.  For unicast logical output ports on remote hypervisors,
         the actions set the tunnel key to the correct value, then send the
-        packet on the tunnel port to the correct hypervisor.  (When the remote
-        hypervisor receives the packet, table 0 there will recognize it as a
-        tunneled packet and pass it along to table 33.)  For multicast logical
-        output ports, the actions send one copy of the packet to each remote
-        hypervisor, in the same way as for unicast destinations.  If a
+        packet on the tunnel port to the correct hypervisor (unless the packet
+        comes from a localport, in which case it will be dropped). (When the
+        remote hypervisor receives the packet, table 0 there will recognize it
+        as a tunneled packet and pass it along to table 33.)  For multicast
+        logical output ports, the actions send one copy of the packet to each
+        remote hypervisor, in the same way as for unicast destinations.  If a
         multicast group includes a logical port or ports on the local
         hypervisor, then its actions also resubmit to table 33.  Table 32 also
         includes a fallback flow that resubmits to table 33 if there is no
