diff --git a/ui/src/views/compute/DeployVM.vue b/ui/src/views/compute/DeployVM.vue
index 88521861f18e..921fd8cb1240 100644
--- a/ui/src/views/compute/DeployVM.vue
+++ b/ui/src/views/compute/DeployVM.vue
@@ -2023,6 +2023,18 @@ export default {
       this.formRef.value.resetFields()
       this.fetchData()
     },
+    updateSelectedTemplateHypervisor () {
+      if (!this.form.templateid) {
+        return
+      }
+      for (const entry of Object.values(this.options.templates)) {
+        const template = entry?.template.find(option => option.id === this.form.templateid)
+        if (template?.hypervisor) {
+          this.form.hypervisor = template.hypervisor
+          return
+        }
+      }
+    },
     updateFieldValue (name, value) {
       if (name === 'templateid') {
         this.imageType = 'templateid'
@@ -2055,6 +2067,9 @@ export default {
           this.form.iothreadsenabled = template.details && Object.prototype.hasOwnProperty.call(template.details, 'iothreads')
           this.form.iodriverpolicy = template.details?.['io.policy']
           this.form.keyboard = template.details?.keyboard
+          if (template.hypervisor) {
+            this.form.hypervisor = template.hypervisor
+          }
           if (template.details['vmware-to-kvm-mac-addresses']) {
             this.dataPreFill.macAddressArray = JSON.parse(template.details['vmware-to-kvm-mac-addresses'])
           }
@@ -2914,11 +2929,12 @@ export default {
         promises.push(this.fetchTemplates(filter, params))
       })
       this.options.templates = templates
-      Promise.all(promises).then((response) => {
+      return Promise.all(promises).then((response) => {
         response.forEach((resItem, idx) => {
           templates[templateFilters[idx]] = _.isEmpty(resItem.listtemplatesresponse) ? { count: 0, template: [] } : resItem.listtemplatesresponse
           this.options.templates = { ...templates }
         })
+        this.updateSelectedTemplateHypervisor()
       }).catch((reason) => {
         console.log(reason)
       }).finally(() => {
diff --git a/ui/tests/unit/views/compute/DeployVMTemplateHypervisor.spec.js b/ui/tests/unit/views/compute/DeployVMTemplateHypervisor.spec.js
new file mode 100644
index 000000000000..1a45886d6aee
--- /dev/null
+++ b/ui/tests/unit/views/compute/DeployVMTemplateHypervisor.spec.js
@@ -0,0 +1,153 @@
+// Licensed to the Apache Software Foundation (ASF) under one
+// or more contributor license agreements.  See the NOTICE file
+// distributed with this work for additional information
+// regarding copyright ownership.  The ASF licenses this file
+// to you under the Apache License, Version 2.0 (the
+// "License"); you may not use this file except in compliance
+// with the License.  You may obtain a copy of the License at
+//
+//   http://www.apache.org/licenses/LICENSE-2.0
+//
+// Unless required by applicable law or agreed to in writing,
+// software distributed under the License is distributed on an
+// "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+// KIND, either express or implied.  See the License for the
+// specific language governing permissions and limitations
+// under the License.
+
+import DeployVM from '@/views/compute/DeployVM'
+
+jest.mock('@views/compute/wizard/OwnershipSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/DeployButtons', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/ZoneBlockRadioGroupSelect', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/ComputeOfferingSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/ComputeSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/DiskOfferingSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/DiskSizeSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/MultiDiskSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/TemplateIsoSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/OsBasedImageSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/AffinityGroupSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/NetworkSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/NetworkConfiguration', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/SshKeyPairSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/UserDataSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/SecurityGroupSelection', () => ({}), { virtual: true })
+jest.mock('@views/compute/wizard/DeployInstanceBackupSelection', () => ({}), { virtual: true })
+
+const createContext = (template, fallbackHypervisor = 'KVM') => ({
+  imageType: null,
+  form: {
+    hypervisor: fallbackHypervisor,
+    isoid: 'old-iso',
+    snapshotid: 'old-snapshot',
+    templateid: null,
+    volumeid: 'old-volume'
+  },
+  options: {
+    bootModes: [],
+    templates: {
+      featured: {
+        template: template ? [template] : []
+      }
+    }
+  },
+  dataPreFill: {},
+  fetchBootModes: jest.fn(),
+  resetFromTemplateConfiguration: jest.fn(),
+  resetTemplateAssociatedResources: jest.fn(),
+  updateTemplateLinkedUserData: jest.fn(),
+  updateTemplateParameters: jest.fn(),
+  updateSelectedTemplateHypervisor:
+    DeployVM.methods.updateSelectedTemplateHypervisor
+})
+
+const createTemplate = (id, hypervisor) => ({
+  id,
+  details: {},
+  hypervisor,
+  isdynamicallyscalable: false,
+  size: 0
+})
+
+describe('DeployVM selected template hypervisor', () => {
+  it.each(['KVM', 'XenServer', 'VMware', 'External'])(
+    'updates the deployment form to %s from selected template metadata',
+    hypervisor => {
+      const template = createTemplate('selected-template', hypervisor)
+      const context = createContext(template)
+
+      DeployVM.methods.updateFieldValue.call(
+        context,
+        'templateid',
+        template.id
+      )
+
+      expect(context.form).toMatchObject({
+        hypervisor,
+        isoid: null,
+        snapshotid: null,
+        templateid: template.id,
+        volumeid: null
+      })
+      expect(context.dataPreFill.hypervisorType).toBe(hypervisor)
+    }
+  )
+
+  it('keeps the zone fallback when the selected template is not in the loaded results', () => {
+    const context = createContext(null)
+
+    DeployVM.methods.updateFieldValue.call(
+      context,
+      'templateid',
+      'missing-template'
+    )
+
+    expect(context.form.hypervisor).toBe('KVM')
+  })
+
+  it('uses selected template metadata when no zone fallback is available', () => {
+    const template = createTemplate('xen-template', 'XenServer')
+    const context = createContext(template, null)
+
+    DeployVM.methods.updateFieldValue.call(
+      context,
+      'templateid',
+      template.id
+    )
+
+    expect(context.form.hypervisor).toBe('XenServer')
+  })
+
+  it('keeps the zone fallback when selected template metadata is incomplete', () => {
+    const template = createTemplate('incomplete-template')
+    const context = createContext(template)
+
+    DeployVM.methods.updateFieldValue.call(
+      context,
+      'templateid',
+      template.id
+    )
+
+    expect(context.form.hypervisor).toBe('KVM')
+  })
+
+  it('reconciles a preselected template after its metadata loads', async () => {
+    const template = createTemplate('prefilled-template', 'XenServer')
+    const context = createContext(null)
+    context.form.templateid = template.id
+    context.getImageFilters = jest.fn(() => ['featured'])
+    context.fetchTemplates = jest.fn(() => Promise.resolve({
+      listtemplatesresponse: {
+        count: 1,
+        template: [template]
+      }
+    }))
+    context.loading = { templates: false }
+
+    await DeployVM.methods.fetchAllTemplates.call(context)
+
+    expect(context.form.hypervisor).toBe('XenServer')
+    expect(context.loading.templates).toBe(false)
+  })
+})