diff --git a/docs/configuration/language-server-settings.md b/docs/configuration/language-server-settings.md
index e7fa61c73..dffaaf04f 100644
--- a/docs/configuration/language-server-settings.md
+++ b/docs/configuration/language-server-settings.md
@@ -48,7 +48,7 @@ the following settings are exclusive to basedpyright
 
 ![](inlayHints.functionReturnTypes.png)
 
-**basedpyright.analysis.inlayHints.genericTypes** [boolean]: Whether to show inlay hints on inferred generic types. (currently only works on `Final` and `ClassVar`):
+**basedpyright.analysis.inlayHints.genericTypes** [boolean]: Whether to show inlay hints on inferred generic types. Defaults to `false`:
 
 ![](inlayHints.genericTypes.png)
 
diff --git a/packages/pyright-internal/src/languageServerBase.ts b/packages/pyright-internal/src/languageServerBase.ts
index 60f0d886b..0fec7a0ac 100644
--- a/packages/pyright-internal/src/languageServerBase.ts
+++ b/packages/pyright-internal/src/languageServerBase.ts
@@ -1011,7 +1011,7 @@ export abstract class LanguageServerBase implements LanguageServerInterface, Dis
                 callArgumentNames: inlayHintSettings?.callArgumentNames ?? true,
                 functionReturnTypes: inlayHintSettings?.functionReturnTypes ?? true,
                 variableTypes: inlayHintSettings?.variableTypes ?? true,
-                genericTypes: inlayHintSettings?.genericTypes ?? true,
+                genericTypes: inlayHintSettings?.genericTypes ?? false,
             }).onInlayHints();
         }, token);
     }
diff --git a/packages/pyright-internal/src/realLanguageServer.ts b/packages/pyright-internal/src/realLanguageServer.ts
index 31da77560..e9f27e94a 100644
--- a/packages/pyright-internal/src/realLanguageServer.ts
+++ b/packages/pyright-internal/src/realLanguageServer.ts
@@ -102,7 +102,12 @@ export abstract class RealLanguageServer extends LanguageServerBase {
             logLevel: LogLevel.Info,
             autoImportCompletions: true,
             functionSignatureDisplay: SignatureDisplayType.formatted,
-            inlayHints: { callArgumentNames: true, functionReturnTypes: true, variableTypes: true, genericTypes: true },
+            inlayHints: {
+                callArgumentNames: true,
+                functionReturnTypes: true,
+                variableTypes: true,
+                genericTypes: false,
+            },
         };
 
         try {
diff --git a/packages/vscode-pyright/package.json b/packages/vscode-pyright/package.json
index 968797e21..2066f9fee 100644
--- a/packages/vscode-pyright/package.json
+++ b/packages/vscode-pyright/package.json
@@ -1764,7 +1764,7 @@
                 },
                 "basedpyright.analysis.inlayHints.genericTypes": {
                     "type": "boolean",
-                    "default": true,
+                    "default": false,
                     "description": "Whether to show inlay hints on inferred generic types.",
                     "scope": "resource"
                 }