A system for layer-2 path tracing is provided. During operation, the system can send, from an originating device, a layer-2 trace packet with a packet type in a layer-2 header of the layer-2 trace packet. The packet type can indicate the trace packet to be a tracing packet. The system can then receive a layer-2 response packet from a respective participating device, which supports layer-2 path tracing, on a path to a target device of the trace packet. Subsequently, the system can obtain, from a payload of the response packet, trace information of a forward path to the participating device traversed by the trace packet and a reverse path from the participating device traversed by the response packet. The trace information can identify one or more layer-2 devices along the forward and reverse paths, and include one or more layer-2 identifiers corresponding to the identified one or more layer-2 devices.