diff --git a/agent/assistant/llm.go b/agent/assistant/llm.go
index de58aac0..b4e9d955 100644
--- a/agent/assistant/llm.go
+++ b/agent/assistant/llm.go
@@ -47,6 +47,8 @@ func (ast *Assistant) executeLLMStream(
 	// Create LLM instance with connector and options
 	llmInstance, err := llm.New(conn, completionOptions)
 	if err != nil {
+		// Mark LLM Request as failed in trace
+		ast.traceLLMFail(ctx, err)
 		return nil, err
 	}
 
@@ -70,6 +72,8 @@ func (ast *Assistant) executeLLMStream(
 	log.Trace("[AGENT] LLM Stream returned: assistant=%s, err=%v", ast.ID, err)
 	if err != nil {
 		log.Trace("[AGENT] Calling sendStreamEndOnError")
+		// Mark LLM Request as failed in trace
+		ast.traceLLMFail(ctx, err)
 		return nil, err
 	}
 
@@ -108,6 +112,8 @@ func (ast *Assistant) executeLLMForToolRetry(
 	// Create LLM instance with connector and options
 	llmInstance, err := llm.New(conn, completionOptions)
 	if err != nil {
+		// Mark LLM Retry Request as failed in trace
+		ast.traceLLMFail(ctx, err)
 		return nil, err
 	}
 
@@ -116,6 +122,8 @@ func (ast *Assistant) executeLLMForToolRetry(
 	completionResponse, err := llmInstance.Stream(ctx, completionMessages, completionOptions, streamHandler)
 	log.Trace("[AGENT] LLM tool retry stream returned: assistant=%s, err=%v", ast.ID, err)
 	if err != nil {
+		// Mark LLM Retry Request as failed in trace
+		ast.traceLLMFail(ctx, err)
 		return nil, err
 	}
 
diff --git a/agent/assistant/trace.go b/agent/assistant/trace.go
index da15e621..c8807f60 100644
--- a/agent/assistant/trace.go
+++ b/agent/assistant/trace.go
@@ -84,6 +84,16 @@ func (ast *Assistant) traceLLMComplete(ctx *context.Context, completionResponse
 	trace.Complete(completionResponse)
 }
 
+// traceLLMFail marks the LLM request as failed in the trace
+func (ast *Assistant) traceLLMFail(ctx *context.Context, err error) {
+	trace, _ := ctx.Trace()
+	if trace == nil {
+		return
+	}
+
+	trace.Fail(err)
+}
+
 // traceAgentCompletion creates a completion node to report the final output
 func (ast *Assistant) traceAgentCompletion(ctx *context.Context, createResponse *context.HookCreateResponse, nextResponse *context.NextHookResponse, completionResponse *context.CompletionResponse, finalResponse interface{}) {
 	trace, _ := ctx.Trace()