An internetwork relay system and method for transmitting IP traffic including an edge and a core. The edge includes an ingress and egress routers and the core includes a switch network. The ingress router communicates with and receives an IP packet from a source network. The ingress router attaches to each IP packet, a globally unique label which is used to forward the IP packet across the network. The relay switch network communicates with the ingress router, receives the IP packet from the ingress router and forwards the IP packet along its transmission path based on destination information included in its attached label. The egress router receives the IP packet from the switch network and forwards it to a destination network. Once received, the destination network forwards the IP packet to its intended destination.