diff --git a/gax-java/gax/src/main/java/com/google/api/gax/tracing/GoldenSignalsMetricsTracerFactory.java b/gax-java/gax/src/main/java/com/google/api/gax/tracing/GoldenSignalsMetricsTracerFactory.java
index 1ef4e1112f..53b8998a86 100644
--- a/gax-java/gax/src/main/java/com/google/api/gax/tracing/GoldenSignalsMetricsTracerFactory.java
+++ b/gax-java/gax/src/main/java/com/google/api/gax/tracing/GoldenSignalsMetricsTracerFactory.java
@@ -42,13 +42,13 @@
 @InternalApi
 public class GoldenSignalsMetricsTracerFactory implements ApiTracerFactory {
 
-  private ApiTracerContext apiTracerContext;
+  private ApiTracerContext clientLevelTracerContext;
   private final OpenTelemetry openTelemetry;
   private GoldenSignalsMetricsRecorder metricsRecorder;
 
   public GoldenSignalsMetricsTracerFactory(OpenTelemetry openTelemetry) {
     this.openTelemetry = openTelemetry;
-    this.apiTracerContext = ApiTracerContext.empty();
+    this.clientLevelTracerContext = ApiTracerContext.empty();
   }
 
   @Override
@@ -58,15 +58,26 @@ public ApiTracer newTracer(ApiTracer parent, SpanName spanName, OperationType op
       // regular requests.
       return new BaseApiTracer();
     }
-    return new GoldenSignalsMetricsTracer(metricsRecorder, apiTracerContext);
+    return new GoldenSignalsMetricsTracer(metricsRecorder, clientLevelTracerContext);
+  }
+
+  @Override
+  public ApiTracer newTracer(ApiTracer parent, ApiTracerContext methodLevelTracerContext) {
+    if (metricsRecorder == null) {
+      // This should never happen, in case it happens, create a no-op api tracer to not block
+      // regular requests.
+      return new BaseApiTracer();
+    }
+    ApiTracerContext mergedTracerContext = clientLevelTracerContext.merge(methodLevelTracerContext);
+    return new GoldenSignalsMetricsTracer(metricsRecorder, mergedTracerContext);
   }
 
   @Override
   public ApiTracerFactory withContext(ApiTracerContext context) {
-    this.apiTracerContext = context;
+    this.clientLevelTracerContext = context;
     this.metricsRecorder =
         new GoldenSignalsMetricsRecorder(
-            openTelemetry, apiTracerContext.libraryMetadata().artifactName());
+            openTelemetry, clientLevelTracerContext.libraryMetadata().artifactName());
     return this;
   }
 }
diff --git a/gax-java/gax/src/test/java/com/google/api/gax/tracing/GoldenSignalsMetricsTracerFactoryTest.java b/gax-java/gax/src/test/java/com/google/api/gax/tracing/GoldenSignalsMetricsTracerFactoryTest.java
index 8a39ff27f1..9726101c07 100644
--- a/gax-java/gax/src/test/java/com/google/api/gax/tracing/GoldenSignalsMetricsTracerFactoryTest.java
+++ b/gax-java/gax/src/test/java/com/google/api/gax/tracing/GoldenSignalsMetricsTracerFactoryTest.java
@@ -30,7 +30,8 @@
 package com.google.api.gax.tracing;
 
 import static com.google.common.truth.Truth.assertThat;
-import static org.mockito.Mockito.mock;
+import static org.mockito.Answers.RETURNS_DEEP_STUBS;
+import static org.mockito.Mockito.*;
 
 import io.opentelemetry.api.OpenTelemetry;
 import org.junit.jupiter.api.BeforeEach;
@@ -46,7 +47,7 @@ void setUp() {
   }
 
   @Test
-  void newTracer_createsTracer_successfully() {
+  void newTracerWithSpanName_shouldCreateTracer_ifMetricsRecorderIsNotNull() {
     tracerFactory.withContext(ApiTracerContext.empty());
     ApiTracer actual =
         tracerFactory.newTracer(
@@ -55,10 +56,32 @@ void newTracer_createsTracer_successfully() {
   }
 
   @Test
-  void newTracer_createsBaseTracer_ifMetricsRecorderIsNull() {
+  void newTracerWithSpanName_shouldCreateBaseTracer_ifMetricsRecorderIsNull() {
     ApiTracer actual =
         tracerFactory.newTracer(
             mock(ApiTracer.class), mock(SpanName.class), ApiTracerFactory.OperationType.Unary);
     assertThat(actual).isInstanceOf(BaseApiTracer.class);
   }
+
+  @Test
+  void newTracerWithApiTracerContext_shouldMergeApiTracerContext() {
+    ApiTracerContext clientLevelTracerContext = mock(ApiTracerContext.class, RETURNS_DEEP_STUBS);
+    ApiTracerContext methodLevelTracerContext = mock(ApiTracerContext.class);
+    when(clientLevelTracerContext.libraryMetadata().artifactName()).thenReturn("does not matter");
+    when(clientLevelTracerContext.merge(methodLevelTracerContext))
+        .thenReturn(clientLevelTracerContext);
+
+    tracerFactory.withContext(clientLevelTracerContext);
+    ApiTracer actual = tracerFactory.newTracer(mock(ApiTracer.class), methodLevelTracerContext);
+
+    verify(clientLevelTracerContext).merge(methodLevelTracerContext);
+    assertThat(actual).isInstanceOf(GoldenSignalsMetricsTracer.class);
+  }
+
+  @Test
+  void newTracerWithApiTracerContext_shouldCreateBaseTracer_ifMetricsRecorderIsNull() {
+    ApiTracer actual = tracerFactory.newTracer(mock(ApiTracer.class), mock(ApiTracerContext.class));
+
+    assertThat(actual).isInstanceOf(BaseApiTracer.class);
+  }
 }