diff --git a/CHANGELOG.md b/CHANGELOG.md
index 4fcba714..561c3364 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -13,6 +13,7 @@
 - **aiken-lang**: Change default placeholder for `trace` to `Void` instead of `todo`. @KtorZ
 - **aiken-lang**: Disallow (parse error) dangling colon `:` in traces. See [#1113](https://github.com/aiken-lang/aiken/issues/1113). @KtorZ
 - **aiken-lang**: Fix `aiken blueprint apply` wrongly overriding all validators handlers names & ABI to the mint's one. See [#1099](https://github.com/aiken-lang/aiken/issues/1099). @KtorZ
+- **aiken-lang**: Always type-check trace label irrespective of the trace level, to avoid unnecessary warnings in compact or silent mode. See [#1122](https://github.com/aiken-lang/aiken/issues/1122). @KtorZ
 
 ### Fixed
 
diff --git a/crates/aiken-lang/src/tests/check.rs b/crates/aiken-lang/src/tests/check.rs
index 07d39e94..08aec14e 100644
--- a/crates/aiken-lang/src/tests/check.rs
+++ b/crates/aiken-lang/src/tests/check.rs
@@ -1321,8 +1321,8 @@ fn trace_non_string_label_compact() {
     "#;
 
     assert!(matches!(
-        check_with_verbosity(parse(source_code), TraceLevel::Compact),
-        Err((_, Error::CouldNotUnify { .. }))
+        &check_with_verbosity(parse(source_code), TraceLevel::Compact),
+        Ok((warnings, _)) if warnings == &[Warning::CompactTraceLabelIsNotstring { location: Span::create(40, 7) }],
     ))
 }
 
diff --git a/crates/aiken-lang/src/tipo/error.rs b/crates/aiken-lang/src/tipo/error.rs
index 2a438f4a..c5bbbbad 100644
--- a/crates/aiken-lang/src/tipo/error.rs
+++ b/crates/aiken-lang/src/tipo/error.rs
@@ -1865,6 +1865,15 @@ pub enum Warning {
         location: Span,
         suggestion: UntypedPattern,
     },
+
+    #[error("I noticed a (compact) dynamic trace label which is not a string")]
+    #[diagnostic(help("Compiling with a compact trace-level, you are probably expecting compact traces although here, the entire label will need to be serialise *at runtime* which will add a significant overhead.\n\nAs a reminder, trace arguments are fully ignored in compact tracing. Hence, you probably want to put a cute little label here and move the current trace as argument!"))]
+    #[diagnostic(code("trace::label_is_not_string"))]
+    #[diagnostic(url("https://aiken-lang.org/language-tour/troubleshooting#traces"))]
+    CompactTraceLabelIsNotstring {
+        #[label("compact trace label is not String")]
+        location: Span,
+    },
 }
 
 impl ExtraData for Warning {
@@ -1884,6 +1893,7 @@ impl ExtraData for Warning {
             | Warning::UnusedVariable { .. }
             | Warning::DiscardedLetAssignment { .. }
             | Warning::ValidatorInLibraryModule { .. }
+            | Warning::CompactTraceLabelIsNotstring { .. }
             | Warning::UseWhenInstead { .. } => None,
             Warning::Utf8ByteArrayIsValidHexString { value, .. } => Some(value.clone()),
             Warning::UnusedImportedModule { location, .. } => {
diff --git a/crates/aiken-lang/src/tipo/expr.rs b/crates/aiken-lang/src/tipo/expr.rs
index 43fe0dd6..a3c2e6d0 100644
--- a/crates/aiken-lang/src/tipo/expr.rs
+++ b/crates/aiken-lang/src/tipo/expr.rs
@@ -2506,6 +2506,7 @@ impl<'a, 'b> ExprTyper<'a, 'b> {
 
     #[allow(clippy::result_large_err)]
     fn infer_trace_arg(&mut self, arg: UntypedExpr) -> Result<TypedExpr, Error> {
+        let location = arg.location();
         let typed_arg = self.infer(arg)?;
         match self.unify(
             Type::string(),
@@ -2514,6 +2515,12 @@ impl<'a, 'b> ExprTyper<'a, 'b> {
             false,
         ) {
             Err(_) => {
+                if matches!(self.tracing.trace_level(false), TraceLevel::Compact) {
+                    self.environment
+                        .warnings
+                        .push(Warning::CompactTraceLabelIsNotstring { location });
+                }
+
                 self.unify(Type::data(), typed_arg.tipo(), typed_arg.location(), true)?;
                 Ok(diagnose_expr(typed_arg))
             }
@@ -2546,44 +2553,38 @@ impl<'a, 'b> ExprTyper<'a, 'b> {
             })
         }
 
+        let label = self.infer_trace_arg(label)?;
+
+        let text = if typed_arguments.is_empty() {
+            label.clone()
+        } else {
+            let delimiter = |ix| TypedExpr::String {
+                location: Span::empty(),
+                tipo: Type::string(),
+                value: if ix == 0 { ": " } else { ", " }.to_string(),
+            };
+            typed_arguments
+                .into_iter()
+                .enumerate()
+                .fold(label.clone(), |text, (ix, arg)| {
+                    append_string_expr(append_string_expr(text, delimiter(ix)), arg)
+                })
+        };
+
         match self.tracing.trace_level(false) {
             TraceLevel::Silent => Ok(then),
-            TraceLevel::Compact => {
-                let text = self.infer(label)?;
-                self.unify(Type::string(), text.tipo(), text.location(), false)?;
-                Ok(TypedExpr::Trace {
-                    location,
-                    tipo,
-                    then: Box::new(then),
-                    text: Box::new(text),
-                })
-            }
-            TraceLevel::Verbose => {
-                let label = self.infer_trace_arg(label)?;
-
-                let text = if typed_arguments.is_empty() {
-                    label
-                } else {
-                    let delimiter = |ix| TypedExpr::String {
-                        location: Span::empty(),
-                        tipo: Type::string(),
-                        value: if ix == 0 { ": " } else { ", " }.to_string(),
-                    };
-                    typed_arguments
-                        .into_iter()
-                        .enumerate()
-                        .fold(label, |text, (ix, arg)| {
-                            append_string_expr(append_string_expr(text, delimiter(ix)), arg)
-                        })
-                };
-
-                Ok(TypedExpr::Trace {
-                    location,
-                    tipo,
-                    then: Box::new(then),
-                    text: Box::new(text),
-                })
-            }
+            TraceLevel::Compact => Ok(TypedExpr::Trace {
+                location,
+                tipo,
+                then: Box::new(then),
+                text: Box::new(label),
+            }),
+            TraceLevel::Verbose => Ok(TypedExpr::Trace {
+                location,
+                tipo,
+                then: Box::new(then),
+                text: Box::new(text),
+            }),
         }
     }