diff --git a/pkg/providers/instancetype/instancetype.go b/pkg/providers/instancetype/instancetype.go
index 1af7a87e5781..d3d3170cf40f 100644
--- a/pkg/providers/instancetype/instancetype.go
+++ b/pkg/providers/instancetype/instancetype.go
@@ -155,6 +155,9 @@ func (p *Provider) createOfferings(ctx context.Context, instanceType *ec2.Instan
 				price, ok = p.pricingProvider.SpotPrice(*instanceType.InstanceType, az)
 			case ec2.UsageClassTypeOnDemand:
 				price, ok = p.pricingProvider.OnDemandPrice(*instanceType.InstanceType)
+			case "capacity-block":
+				// ignore since karpenter doesn't support it yet, but do not log an unknown capacity type error
+				continue
 			default:
 				logging.FromContext(ctx).Errorf("Received unknown capacity type %s for instance type %s", capacityType, *instanceType.InstanceType)
 				continue