The short answer to your question is it is obviously unethical unless it is specifically done for a relevant and lawful purpose and it can absolutely be illegal

The short answer to your question is it is obviously unethical unless it is specifically done for a relevant and lawful purpose and it can absolutely be illegal depending on the data protection regime you are operating under. Specifically in the UK and EU, sexual orientation is a highly-protected class of personal information known as "Special Category Data". The UK ICO has actually issued guidance on the legality of inference on this category of data[1]: If this is the case, then you are processing special category data regardless of how confident you are that the inference is correct. If you carry out any form of profiling which infers things like ethnicity, beliefs, politics, health status (condition or risks), sexual orientation or sex life, you will be processing special category data and must identify an Article 9 condition for processing. The only article 9 conditions that suffice to make processing of special category data legal are "explicit consent", "not for profit bodies" (under certain conditions) and "substantial public interest" [2] [1] https://ico.org.uk/for-organisations/uk-gdpr-guidance-and-resources/lawful-basis/special-category-data/what-is-special-category-data/#scd7 https://ico.org.uk/for-organisations/uk-gdpr-guidance-and-re... [2] https://ico.org.uk/for-organisations/uk-gdpr-guidance-and-resources/childrens-information/childrens-code-guidance-and-resources/age-appropriate-design-a-code-of-practice-for-online-services/annex-c-lawful-basis-for-processing/#lawfulbasis5 https://ico.org.uk/for-organisations/uk-gdpr-guidance-and-re...