diff --git a/changelog.d/16677.misc b/changelog.d/16677.misc
new file mode 100644
index 000000000000..20c37851c396
--- /dev/null
+++ b/changelog.d/16677.misc
@@ -0,0 +1 @@
+Ignore `encryption_enabled_by_default_for_room_type` setting when creating server notices room, since the notices will be send unencrypted anyway.
diff --git a/synapse/handlers/room.py b/synapse/handlers/room.py
index afd8138caf5b..f865bed1ec2c 100644
--- a/synapse/handlers/room.py
+++ b/synapse/handlers/room.py
@@ -698,6 +698,7 @@ async def create_room(
         config: JsonDict,
         ratelimit: bool = True,
         creator_join_profile: Optional[JsonDict] = None,
+        ignore_forced_encryption: bool = False,
     ) -> Tuple[str, Optional[RoomAlias], int]:
         """Creates a new room.
 
@@ -714,6 +715,8 @@ async def create_room(
                 derived from the user's profile. If set, should contain the
                 values to go in the body of the 'join' event (typically
                 `avatar_url` and/or `displayname`.
+            ignore_forced_encryption:
+                Ignore encryption forced by `encryption_enabled_by_default_for_room_type` setting.
 
         Returns:
             A 3-tuple containing:
@@ -1015,6 +1018,7 @@ async def _send_events_for_new_room(
         room_alias: Optional[RoomAlias] = None,
         power_level_content_override: Optional[JsonDict] = None,
         creator_join_profile: Optional[JsonDict] = None,
+        ignore_forced_encryption: bool = False,
     ) -> Tuple[int, str, int]:
         """Sends the initial events into a new room. Sends the room creation, membership,
         and power level events into the room sequentially, then creates and batches up the
@@ -1049,6 +1053,8 @@ async def _send_events_for_new_room(
             creator_join_profile:
                 Set to override the displayname and avatar for the creating
                 user in this room.
+            ignore_forced_encryption:
+                Ignore encryption forced by `encryption_enabled_by_default_for_room_type` setting.
 
         Returns:
             A tuple containing the stream ID, event ID and depth of the last
@@ -1251,7 +1257,7 @@ async def create_event(
             )
             events_to_send.append((event, context))
 
-        if config["encrypted"]:
+        if config["encrypted"] and not ignore_forced_encryption:
             encryption_event, encryption_context = await create_event(
                 EventTypes.RoomEncryption,
                 {"algorithm": RoomEncryptionAlgorithms.DEFAULT},
diff --git a/synapse/server_notices/server_notices_manager.py b/synapse/server_notices/server_notices_manager.py
index c3552d6c73f8..44b999677a1e 100644
--- a/synapse/server_notices/server_notices_manager.py
+++ b/synapse/server_notices/server_notices_manager.py
@@ -178,6 +178,8 @@ async def get_or_create_notice_room_for_user(self, user_id: str) -> str:
                 "avatar_url": self._config.servernotices.server_notices_mxid_avatar_url,
             }
 
+        # `ignore_forced_encryption` is used to bypass `encryption_enabled_by_default_for_room_type`
+        # setting if it set, since the server notices will not be encrypted anyway.
         room_id, _, _ = await self._room_creation_handler.create_room(
             requester,
             config={
@@ -187,6 +189,7 @@ async def get_or_create_notice_room_for_user(self, user_id: str) -> str:
             },
             ratelimit=False,
             creator_join_profile=join_profile,
+            ignore_forced_encryption=True,
         )
 
         self.maybe_get_notice_room_for_user.invalidate((user_id,))