diff --git a/src/cpp/src/llm_pipeline.cpp b/src/cpp/src/llm_pipeline.cpp
index 2c0f3a2635..1ff9032fa1 100644
--- a/src/cpp/src/llm_pipeline.cpp
+++ b/src/cpp/src/llm_pipeline.cpp
@@ -570,7 +570,7 @@ ov::genai::LLMPipeline::LLMPipeline(
         auto& scheduler_config = properties.at(ov::genai::scheduler_config.name()).as<SchedulerConfig>();
         m_pimpl = std::make_unique<ContinuousBatchingAdapter>(models_path, tokenizer, scheduler_config, device, config_without_scheduler_config);
     } else if ("NPU" == device) {
-        m_pimpl = StaticLLMPipelineFactory::create(models_path, tokenizer, device, properties);
+        m_pimpl = static_llm::LLMPipelineFactory::create(models_path, tokenizer, device, properties);
     } else {
         m_pimpl = std::make_unique<StatefulLLMPipeline>(models_path, tokenizer, device, properties);
     }
@@ -590,7 +590,7 @@ ov::genai::LLMPipeline::LLMPipeline(
         auto& scheduler_config = config.at(ov::genai::scheduler_config.name()).as<SchedulerConfig>();
         m_pimpl = std::make_unique<ContinuousBatchingAdapter>(models_path, scheduler_config, device, config_without_scheduler_config);
     } else if ("NPU" == device) {
-        m_pimpl = StaticLLMPipelineFactory::create(models_path, device, config);
+        m_pimpl = static_llm::LLMPipelineFactory::create(models_path, device, config);
     } else {
         m_pimpl = std::make_unique<StatefulLLMPipeline>(models_path, device, config);
     }
diff --git a/src/cpp/src/llm_pipeline_static.cpp b/src/cpp/src/llm_pipeline_static.cpp
index ae6c8ebf79..fd417607fe 100644
--- a/src/cpp/src/llm_pipeline_static.cpp
+++ b/src/cpp/src/llm_pipeline_static.cpp
@@ -629,8 +629,9 @@ void copy_columns_by_row_chunks(const ov::Tensor& src, ov::Tensor& dst) {
 
 namespace ov {
 namespace genai {
+namespace static_llm {
 
-SMStaticLLMPipeline::SMStaticLLMPipeline(
+StatefulLLMPipeline::StatefulLLMPipeline(
     const std::filesystem::path& models_path,
     const ov::genai::Tokenizer& tokenizer,
     const std::string& device,
@@ -666,7 +667,7 @@ SMStaticLLMPipeline::SMStaticLLMPipeline(
     m_request  = compiled.create_infer_request();
 }
 
-DecodedResults SMStaticLLMPipeline::generate(
+DecodedResults StatefulLLMPipeline::generate(
     StringInputs inputs,
     OptionalGenerationConfig generation_config,
     StreamerVariant streamer
@@ -722,7 +723,7 @@ DecodedResults SMStaticLLMPipeline::generate(
     return decoded_results;
 }
 
-EncodedResults SMStaticLLMPipeline::generate(
+EncodedResults StatefulLLMPipeline::generate(
     const EncodedInputs& inputs,
     OptionalGenerationConfig generation_config,
     StreamerVariant streamer
@@ -822,39 +823,41 @@ EncodedResults SMStaticLLMPipeline::generate(
     }
 }
 
-void SMStaticLLMPipeline::start_chat(const std::string& system_message) {
+void StatefulLLMPipeline::start_chat(const std::string& system_message) {
     if (!system_message.empty()) {
         m_history.push_back({{"role", "system"}, {"content", system_message}});
     }
     m_is_chat_conversation = true;
 };
 
-void SMStaticLLMPipeline::finish_chat() {
+void StatefulLLMPipeline::finish_chat() {
     m_is_chat_conversation = false;
     m_history.clear();
 };
 
 std::unique_ptr<LLMPipelineImplBase>
-StaticLLMPipelineFactory::create(const std::filesystem::path& models_path,
+LLMPipelineFactory::create(const std::filesystem::path& models_path,
                                  const ov::genai::Tokenizer& tokenizer,
                                  const std::string& device,
                                  const ov::AnyMap& config) {
     auto properties = config;
-    const auto use_sm_pipeline = pop_or_default(properties, "USE_SM_PIPELINE", false);
-    if (use_sm_pipeline) {
-        return std::make_unique<SMStaticLLMPipeline>(models_path, tokenizer, device, properties);
+    const auto pipeline_mode = pop_or_default(properties, "NPU_PIPELINE", std::string("STATELESS"));
+    OPENVINO_ASSERT(pipeline_mode == "STATELESS" || pipeline_mode == "STATEFUL",
+                    "Only STATELESS and STATEFULL NPU_PIPELINE modes are supported!");
+    if (pipeline_mode == "STATEFUL") {
+        return std::make_unique<ov::genai::static_llm::StatefulLLMPipeline>(models_path, tokenizer, device, properties);
     }
-    return std::make_unique<StaticLLMPipeline>(models_path, tokenizer, device, properties);
+    return std::make_unique<ov::genai::static_llm::StatelessLLMPipeline>(models_path, tokenizer, device, properties);
 }
 
 std::unique_ptr<LLMPipelineImplBase>
-StaticLLMPipelineFactory::create(const std::filesystem::path& models_path,
+LLMPipelineFactory::create(const std::filesystem::path& models_path,
                                  const std::string& device,
                                  const ov::AnyMap& config) {
     return create(models_path, Tokenizer(models_path), device, config);
 }
 
-StaticLLMPipeline::StaticLLMPipeline(
+StatelessLLMPipeline::StatelessLLMPipeline(
     const std::filesystem::path& models_path,
     const ov::genai::Tokenizer& tokenizer,
     const std::string& device,
@@ -889,14 +892,14 @@ StaticLLMPipeline::StaticLLMPipeline(
     }
 };
 
-StaticLLMPipeline::StaticLLMPipeline(
+StatelessLLMPipeline::StatelessLLMPipeline(
     const std::filesystem::path& models_path,
     const std::string& device,
     const ov::AnyMap& properties
-) : StaticLLMPipeline(models_path, Tokenizer(models_path), device, properties) {
+) : StatelessLLMPipeline(models_path, Tokenizer(models_path), device, properties) {
 }
 
-void StaticLLMPipeline::setupAndCompileModels(
+void StatelessLLMPipeline::setupAndCompileModels(
     const std::filesystem::path& models_path,
     const std::string& device,
     ov::AnyMap& properties) {
@@ -970,7 +973,7 @@ void StaticLLMPipeline::setupAndCompileModels(
     ).create_infer_request();
 }
 
-void StaticLLMPipeline::setupAndImportModels(
+void StatelessLLMPipeline::setupAndImportModels(
     const std::filesystem::path& models_path,
     const std::string& device,
     ov::AnyMap& properties) {
@@ -1044,19 +1047,19 @@ void StaticLLMPipeline::setupAndImportModels(
     m_kvcache_desc = KVCacheDesc { kMaxPromptLen, kMaxPromptLen + kMinResponseLen, 0u, 2u };
 }
 
-void StaticLLMPipeline::start_chat(const std::string& system_message) {
+void StatelessLLMPipeline::start_chat(const std::string& system_message) {
     if (!system_message.empty()) {
         m_history.push_back({{"role", "system"}, {"content", system_message}});
     }
     m_is_chat_conversation = true;
 };
 
-void StaticLLMPipeline::finish_chat() {
+void StatelessLLMPipeline::finish_chat() {
     m_is_chat_conversation = false;
     m_history.clear();
 };
 
-void StaticLLMPipeline::prepare_for_new_conversation() {
+void StatelessLLMPipeline::prepare_for_new_conversation() {
     fill_tensor<int64_t>(m_prefill_request.get_tensor("input_ids"), m_tokenizer.get_pad_token_id());
     fill_tensor<int64_t>(m_prefill_request.get_tensor("position_ids"), 0u);
     fill_tensor<int64_t>(m_prefill_request.get_tensor("attention_mask"), 0u);
@@ -1064,7 +1067,7 @@ void StaticLLMPipeline::prepare_for_new_conversation() {
     m_kvcache_desc.num_stored_tokens = 0u;
 }
 
-DecodedResults StaticLLMPipeline::generate(
+DecodedResults StatelessLLMPipeline::generate(
     StringInputs inputs,
     OptionalGenerationConfig generation_config,
     StreamerVariant streamer
@@ -1119,7 +1122,7 @@ DecodedResults StaticLLMPipeline::generate(
     return decoded_results;
 }
 
-EncodedResults StaticLLMPipeline::generate(
+EncodedResults StatelessLLMPipeline::generate(
     const EncodedInputs& inputs,
     OptionalGenerationConfig generation_config,
     StreamerVariant streamer
@@ -1294,5 +1297,6 @@ EncodedResults StaticLLMPipeline::generate(
     return results;
 }
 
+}  // namespace static_llm
 }  // namespace genai
 }  // namespace ov
diff --git a/src/cpp/src/llm_pipeline_static.hpp b/src/cpp/src/llm_pipeline_static.hpp
index d1867e4b33..b119398b4f 100644
--- a/src/cpp/src/llm_pipeline_static.hpp
+++ b/src/cpp/src/llm_pipeline_static.hpp
@@ -9,8 +9,9 @@
 
 namespace ov {
 namespace genai {
+namespace static_llm {
 
-struct StaticLLMPipelineFactory {
+struct LLMPipelineFactory {
     static std::unique_ptr<LLMPipelineImplBase> create(const std::filesystem::path& path,
                                                        const ov::genai::Tokenizer& tokenizer,
                                                        const std::string& device,
@@ -21,9 +22,9 @@ struct StaticLLMPipelineFactory {
                                                        const ov::AnyMap& config);
 };
 
-class SMStaticLLMPipeline : public LLMPipelineImplBase {
+class StatefulLLMPipeline : public LLMPipelineImplBase {
 public:
-    SMStaticLLMPipeline(
+    StatefulLLMPipeline(
         const std::filesystem::path& path,
         const ov::genai::Tokenizer& tokenizer,
         const std::string& device,
@@ -51,16 +52,16 @@ class SMStaticLLMPipeline : public LLMPipelineImplBase {
     ChatHistory m_history;
 };
 
-class StaticLLMPipeline final : public LLMPipelineImplBase {
+class StatelessLLMPipeline final : public LLMPipelineImplBase {
 public:
-    StaticLLMPipeline(
+    StatelessLLMPipeline(
         const std::filesystem::path& path,
         const ov::genai::Tokenizer& tokenizer,
         const std::string& device,
         const ov::AnyMap& config
     );
 
-    StaticLLMPipeline(
+    StatelessLLMPipeline(
         const std::filesystem::path& path,
         const std::string& device,
         const ov::AnyMap& config
@@ -114,5 +115,6 @@ class StaticLLMPipeline final : public LLMPipelineImplBase {
     ChatHistory m_history;
 };
 
+}  // namespace static_llm
 }  // namespace genai
 }  // namespace ov