diff --git a/packages/cli/src/ui/hooks/useGeminiStream.ts b/packages/cli/src/ui/hooks/useGeminiStream.ts
index 7ab30463..6ff41d2f 100644
--- a/packages/cli/src/ui/hooks/useGeminiStream.ts
+++ b/packages/cli/src/ui/hooks/useGeminiStream.ts
@@ -333,8 +333,6 @@ export const useGeminiStream = (
               { type: 'error', text: `[API Error: ${event.value.message}]` },
               userMessageTimestamp,
             );
-            setStreamingState(StreamingState.Idle);
-            // Allow stream to end naturally
           }
         } // End stream loop
 
diff --git a/packages/server/src/core/client.ts b/packages/server/src/core/client.ts
index 0b1e8ecf..fc6080ab 100644
--- a/packages/server/src/core/client.ts
+++ b/packages/server/src/core/client.ts
@@ -16,7 +16,7 @@ import {
 } from '@google/genai';
 import process from 'node:process';
 import { getFolderStructure } from '../utils/getFolderStructure.js';
-import { Turn, ServerGeminiStreamEvent } from './turn.js';
+import { Turn, ServerGeminiStreamEvent, GeminiEventType } from './turn.js';
 import { Config } from '../config/config.js';
 import { getCoreSystemPrompt } from './prompts.js';
 import { ReadManyFilesTool } from '../tools/read-many-files.js';
@@ -156,7 +156,10 @@ export class GeminiClient {
       turns++;
       const turn = new Turn(chat, availableTools);
       const resultStream = turn.run(request, signal);
+      let seenError = false;
       for await (const event of resultStream) {
+        seenError =
+          seenError === false ? false : event.type === GeminiEventType.Error;
         yield event;
       }
 
@@ -176,6 +179,11 @@ export class GeminiClient {
         }
       }
       request = fnResponses;
+
+      if (seenError) {
+        // We saw an error, lets stop processing to prevent unexpected consequences.
+        break;
+      }
     }
     if (turns >= this.MAX_TURNS) {
       console.warn('sendMessageStream: Reached maximum tool call turns limit.');