diff --git a/packages/payload/src/collections/config/sanitize.ts b/packages/payload/src/collections/config/sanitize.ts
index 617d8cdb0..b073c8ee9 100644
--- a/packages/payload/src/collections/config/sanitize.ts
+++ b/packages/payload/src/collections/config/sanitize.ts
@@ -158,7 +158,12 @@ export const sanitizeCollection = async (
     }
   }
 
-  sanitized.labels = sanitized.labels || formatLabels(sanitized.slug)
+  const defaultLabels = formatLabels(sanitized.slug)
+
+  sanitized.labels = {
+    plural: sanitized.labels?.plural || defaultLabels.plural,
+    singular: sanitized.labels?.singular || defaultLabels.singular,
+  }
 
   if (sanitized.versions) {
     if (sanitized.versions === true) {
diff --git a/packages/payload/src/utilities/formatLabels.ts b/packages/payload/src/utilities/formatLabels.ts
index 117ec302c..b413ba2a1 100644
--- a/packages/payload/src/utilities/formatLabels.ts
+++ b/packages/payload/src/utilities/formatLabels.ts
@@ -22,6 +22,7 @@ const toWords = (inputString: string, joinWords = false): string => {
 
 const formatLabels = (slug: string): { plural: string; singular: string } => {
   const words = toWords(slug)
+
   return isPlural(slug)
     ? {
         plural: words,
diff --git a/test/config/config.ts b/test/config/config.ts
index 957b7c799..ee2237c40 100644
--- a/test/config/config.ts
+++ b/test/config/config.ts
@@ -14,6 +14,10 @@ export default buildConfigWithDefaults({
   collections: [
     {
       slug: 'pages',
+      labels: {
+        // Purposefully exclude `singular` to test default inheritance
+        plural: 'Pages',
+      },
       access: {
         create: () => true,
         delete: () => true,
diff --git a/test/config/int.spec.ts b/test/config/int.spec.ts
index 398adbbd0..a715935a1 100644
--- a/test/config/int.spec.ts
+++ b/test/config/int.spec.ts
@@ -126,6 +126,11 @@ describe('Config', () => {
         description: 'The blockOne of this page',
       })
     })
+
+    it('properly merges collection.labels with defaults', () => {
+      const [collection] = payload.config.collections
+      expect(collection?.labels).toEqual({ plural: 'Pages', singular: 'Page' })
+    })
   })
 
   describe('global config', () => {