diff --git a/lib/neutron b/lib/neutron
index 2763f260d8..98636b4b41 100644
--- a/lib/neutron
+++ b/lib/neutron
@@ -166,10 +166,10 @@ fi
 # remote connectivity), and no physical resources will be
 # available for the allocation of provider networks.
 
-# To use GRE tunnels for tenant networks, set to True in
-# ``localrc``. GRE tunnels are only supported by the openvswitch
-# plugin, and currently only on Ubuntu.
-ENABLE_TENANT_TUNNELS=${ENABLE_TENANT_TUNNELS:-False}
+# To disable tunnels (GRE or VXLAN) for tenant networks,
+# set to False in ``local.conf``.
+# GRE tunnels are only supported by the openvswitch.
+ENABLE_TENANT_TUNNELS=${ENABLE_TENANT_TUNNELS:-True}
 
 # If using GRE tunnels for tenant networks, specify the range of
 # tunnel IDs from which tenant networks are allocated. Can be
diff --git a/lib/neutron_plugins/ml2 b/lib/neutron_plugins/ml2
index f7f7838459..d2700156ee 100644
--- a/lib/neutron_plugins/ml2
+++ b/lib/neutron_plugins/ml2
@@ -7,9 +7,9 @@ set +o xtrace
 
 # Enable this to simply and quickly enable tunneling with ML2.
 # Select either 'gre', 'vxlan', or '(gre vxlan)'
-Q_ML2_TENANT_NETWORK_TYPE=${Q_ML2_TENANT_NETWORK_TYPE:-}
+Q_ML2_TENANT_NETWORK_TYPE=${Q_ML2_TENANT_NETWORK_TYPE:-"vxlan"}
 # This has to be set here since the agent will set this in the config file
-if [[ "$Q_ML2_TENANT_NETWORK_TYPE" != "" ]]; then
+if [[ "$Q_ML2_TENANT_NETWORK_TYPE" != "local" ]]; then
     Q_AGENT_EXTRA_AGENT_OPTS+=(tunnel_types=$Q_ML2_TENANT_NETWORK_TYPE)
 elif [[ "$ENABLE_TENANT_TUNNELS" == "True" ]]; then
     Q_AGENT_EXTRA_AGENT_OPTS+=(tunnel_types=gre)
@@ -57,7 +57,7 @@ function neutron_plugin_configure_common {
 }
 
 function neutron_plugin_configure_service {
-    if [[ "$Q_ML2_TENANT_NETWORK_TYPE" != "" ]]; then
+    if [[ "$Q_ML2_TENANT_NETWORK_TYPE" != "local" ]]; then
         Q_SRV_EXTRA_OPTS+=(tenant_network_types=$Q_ML2_TENANT_NETWORK_TYPE)
     elif [[ "$ENABLE_TENANT_TUNNELS" == "True" ]]; then
         # This assumes you want a simple configuration, and will overwrite