diff --git a/server/embed/etcd.go b/server/embed/etcd.go
index 86605021c..bbb39671c 100644
--- a/server/embed/etcd.go
+++ b/server/embed/etcd.go
@@ -20,6 +20,7 @@ import (
 	"fmt"
 	"io/ioutil"
 	defaultLog "log"
+	"math"
 	"net"
 	"net/http"
 	"net/url"
@@ -32,6 +33,7 @@ import (
 	"go.etcd.io/etcd/api/v3/version"
 	"go.etcd.io/etcd/client/pkg/v3/transport"
 	"go.etcd.io/etcd/client/pkg/v3/types"
+	"go.etcd.io/etcd/client/v3/credentials"
 	"go.etcd.io/etcd/pkg/v3/debugutil"
 	runtimeutil "go.etcd.io/etcd/pkg/v3/runtime"
 	"go.etcd.io/etcd/server/v3/config"
@@ -48,6 +50,7 @@ import (
 	"github.com/soheilhy/cmux"
 	"go.uber.org/zap"
 	"google.golang.org/grpc"
+	"google.golang.org/grpc/credentials/insecure"
 	"google.golang.org/grpc/keepalive"
 )
 
@@ -743,12 +746,57 @@ func (e *Etcd) serveClients() (err error) {
 	// start client servers in each goroutine
 	for _, sctx := range e.sctxs {
 		go func(s *serveCtx) {
-			e.errHandler(s.serve(e.Server, &e.cfg.ClientTLSInfo, h, e.errHandler, gopts...))
+			e.errHandler(s.serve(e.Server, &e.cfg.ClientTLSInfo, h, e.errHandler, e.grpcGatewayDial(), gopts...))
 		}(sctx)
 	}
 	return nil
 }
 
+func (e *Etcd) grpcGatewayDial() (grpcDial func(ctx context.Context) (*grpc.ClientConn, error)) {
+	if !e.cfg.EnableGRPCGateway {
+		return nil
+	}
+	sctx := e.pickGrpcGatewayServeContext()
+	addr := sctx.addr
+	if network := sctx.network; network == "unix" {
+		// explicitly define unix network for gRPC socket support
+		addr = fmt.Sprintf("%s://%s", network, addr)
+	}
+
+	opts := []grpc.DialOption{grpc.WithDefaultCallOptions(grpc.MaxCallRecvMsgSize(math.MaxInt32))}
+	if sctx.secure {
+		tlscfg, tlsErr := e.cfg.ClientTLSInfo.ServerConfig()
+		if tlsErr != nil {
+			return func(ctx context.Context) (*grpc.ClientConn, error) {
+				return nil, tlsErr
+			}
+		}
+		dtls := tlscfg.Clone()
+		// trust local server
+		dtls.InsecureSkipVerify = true
+		bundle := credentials.NewBundle(credentials.Config{TLSConfig: dtls})
+		opts = append(opts, grpc.WithTransportCredentials(bundle.TransportCredentials()))
+	} else {
+		opts = append(opts, grpc.WithTransportCredentials(insecure.NewCredentials()))
+	}
+
+	return func(ctx context.Context) (*grpc.ClientConn, error) {
+		conn, err := grpc.DialContext(ctx, addr, opts...)
+		if err != nil {
+			sctx.lg.Error("grpc gateway failed to dial", zap.String("addr", addr), zap.Error(err))
+			return nil, err
+		}
+		return conn, err
+	}
+}
+
+func (e *Etcd) pickGrpcGatewayServeContext() *serveCtx {
+	for _, sctx := range e.sctxs {
+		return sctx
+	}
+	panic("Expect at least one context able to serve grpc")
+}
+
 func (e *Etcd) serveMetrics() (err error) {
 	if e.cfg.Metrics == "extensive" {
 		grpc_prometheus.EnableHandlingTimeHistogram()
diff --git a/server/embed/serve.go b/server/embed/serve.go
index 6cfaeb01e..a53cb38e9 100644
--- a/server/embed/serve.go
+++ b/server/embed/serve.go
@@ -19,14 +19,12 @@ import (
 	"fmt"
 	"io/ioutil"
 	defaultLog "log"
-	"math"
 	"net"
 	"net/http"
 	"strings"
 
 	etcdservergw "go.etcd.io/etcd/api/v3/etcdserverpb/gw"
 	"go.etcd.io/etcd/client/pkg/v3/transport"
-	"go.etcd.io/etcd/client/v3/credentials"
 	"go.etcd.io/etcd/pkg/v3/debugutil"
 	"go.etcd.io/etcd/pkg/v3/httputil"
 	"go.etcd.io/etcd/server/v3/config"
@@ -95,6 +93,7 @@ func (sctx *serveCtx) serve(
 	tlsinfo *transport.TLSInfo,
 	handler http.Handler,
 	errHandler func(error),
+	grpcDialForRestGatewayBackends func(ctx context.Context) (*grpc.ClientConn, error),
 	gopts ...grpc.ServerOption) (err error) {
 	logger := defaultLog.New(ioutil.Discard, "etcdhttp", 0)
 	<-s.ReadyNotify()
@@ -106,6 +105,18 @@ func (sctx *serveCtx) serve(
 	servElection := v3election.NewElectionServer(v3c)
 	servLock := v3lock.NewLockServer(v3c)
 
+	// Make sure serversC is closed even if we prematurely exit the function.
+	defer close(sctx.serversC)
+	var gwmux *gw.ServeMux
+	if s.Cfg.EnableGRPCGateway {
+		// GRPC gateway connects to grpc server via connection provided by grpc dial.
+		gwmux, err = sctx.registerGateway(grpcDialForRestGatewayBackends)
+		if err != nil {
+			sctx.lg.Error("registerGateway failed", zap.Error(err))
+			return err
+		}
+	}
+
 	if sctx.insecure {
 		gs := v3rpc.Server(s, nil, nil, gopts...)
 		v3electionpb.RegisterElectionServer(gs, servElection)
@@ -127,14 +138,6 @@ func (sctx *serveCtx) serve(
 			errHandler(gs.Serve(grpcLis))
 		}(gs, grpcl)
 
-		var gwmux *gw.ServeMux
-		if s.Cfg.EnableGRPCGateway {
-			gwmux, err = sctx.registerGateway([]grpc.DialOption{grpc.WithInsecure()})
-			if err != nil {
-				return err
-			}
-		}
-
 		httpmux := sctx.createMux(gwmux, handler)
 
 		srvhttp := &http.Server{
@@ -180,20 +183,6 @@ func (sctx *serveCtx) serve(
 		}(gs)
 
 		handler = grpcHandlerFunc(gs, handler)
-
-		var gwmux *gw.ServeMux
-		if s.Cfg.EnableGRPCGateway {
-			dtls := tlscfg.Clone()
-			// trust local server
-			dtls.InsecureSkipVerify = true
-			bundle := credentials.NewBundle(credentials.Config{TLSConfig: dtls})
-			opts := []grpc.DialOption{grpc.WithTransportCredentials(bundle.TransportCredentials())}
-			gwmux, err = sctx.registerGateway(opts)
-			if err != nil {
-				return err
-			}
-		}
-
 		var tlsl net.Listener
 		tlsl, err = transport.NewTLSListener(m.Match(cmux.Any()), tlsinfo)
 		if err != nil {
@@ -255,20 +244,10 @@ func grpcHandlerFunc(grpcServer *grpc.Server, otherHandler http.Handler) http.Ha
 
 type registerHandlerFunc func(context.Context, *gw.ServeMux, *grpc.ClientConn) error
 
-func (sctx *serveCtx) registerGateway(opts []grpc.DialOption) (*gw.ServeMux, error) {
+func (sctx *serveCtx) registerGateway(dial func(ctx context.Context) (*grpc.ClientConn, error)) (*gw.ServeMux, error) {
 	ctx := sctx.ctx
 
-	addr := sctx.addr
-	if network := sctx.network; network == "unix" {
-		// explicitly define unix network for gRPC socket support
-		addr = fmt.Sprintf("%s://%s", network, addr)
-	}
-
-	opts = append(opts, grpc.WithDefaultCallOptions([]grpc.CallOption{
-		grpc.MaxCallRecvMsgSize(math.MaxInt32),
-	}...))
-
-	conn, err := grpc.DialContext(ctx, addr, opts...)
+	conn, err := dial(ctx)
 	if err != nil {
 		return nil, err
 	}