diff --git a/sdk/appconfiguration/Azure.Data.AppConfiguration/src/AudienceErrorHandlingPolicy.cs b/sdk/appconfiguration/Azure.Data.AppConfiguration/src/AudienceErrorHandlingPolicy.cs
new file mode 100644
index 000000000000..f43e29612763
--- /dev/null
+++ b/sdk/appconfiguration/Azure.Data.AppConfiguration/src/AudienceErrorHandlingPolicy.cs
@@ -0,0 +1,52 @@
+// Copyright (c) Microsoft Corporation. All rights reserved.
+// Licensed under the MIT License.
+
+using System;
+using System.Threading.Tasks;
+using Azure.Core;
+using Azure.Core.Pipeline;
+
+namespace Azure.Data.AppConfiguration
+{
+    /// <summary>
+    /// Pipeline policy that provides more helpful errors when Entra ID audience misconfiguration is detected.
+    /// </summary>
+    internal class AudienceErrorHandlingPolicy : HttpPipelinePolicy
+    {
+        private readonly bool _isAudienceConfigured;
+        private const string AadAudienceErrorCode = "AADSTS500011";
+        private const string NoAudienceErrorMessage = $"Unable to authenticate to Azure App Configuration. No authentication token audience was provided. Please set {nameof(ConfigurationClientOptions)}.{nameof(ConfigurationClientOptions.Audience)} to the appropriate audience for the target cloud. For details on how to configure the authentication token audience visit https://aka.ms/appconfig/client-token-audience.";
+        private const string WrongAudienceErrorMessage = $"Unable to authenticate to Azure App Configuration. An incorrect token audience was provided. Please set {nameof(ConfigurationClientOptions)}.{nameof(ConfigurationClientOptions.Audience)} to the appropriate audience for the target cloud. For details on how to configure the authentication token audience visit https://aka.ms/appconfig/client-token-audience.";
+
+        public AudienceErrorHandlingPolicy(bool isAudienceConfigured)
+        {
+            _isAudienceConfigured = isAudienceConfigured;
+        }
+
+        public override void Process(HttpMessage message, ReadOnlyMemory<HttpPipelinePolicy> pipeline)
+        {
+            try
+            {
+                ProcessNext(message, pipeline);
+            }
+            catch (Exception ex) when (ex.Message.Contains(AadAudienceErrorCode))
+            {
+                string errorMessage = _isAudienceConfigured ? WrongAudienceErrorMessage : NoAudienceErrorMessage;
+                throw new RequestFailedException(errorMessage, ex);
+            }
+        }
+
+        public override async ValueTask ProcessAsync(HttpMessage message, ReadOnlyMemory<HttpPipelinePolicy> pipeline)
+        {
+            try
+            {
+                await ProcessNextAsync(message, pipeline).ConfigureAwait(false);
+            }
+            catch (Exception ex) when (ex.Message.Contains(AadAudienceErrorCode))
+            {
+                string errorMessage = _isAudienceConfigured ? WrongAudienceErrorMessage : NoAudienceErrorMessage;
+                throw new RequestFailedException(errorMessage, ex);
+            }
+        }
+    }
+}
diff --git a/sdk/appconfiguration/Azure.Data.AppConfiguration/src/ConfigurationClient.cs b/sdk/appconfiguration/Azure.Data.AppConfiguration/src/ConfigurationClient.cs
index 7b63921eb5b1..be24b889c12a 100644
--- a/sdk/appconfiguration/Azure.Data.AppConfiguration/src/ConfigurationClient.cs
+++ b/sdk/appconfiguration/Azure.Data.AppConfiguration/src/ConfigurationClient.cs
@@ -200,7 +200,7 @@ private static HttpPipeline CreatePipeline(ConfigurationClientOptions options, H
         {
             return HttpPipelineBuilder.Build(options,
                 new HttpPipelinePolicy[] { new CustomHeadersPolicy(), new QueryParamPolicy() },
-                new HttpPipelinePolicy[] { authenticationPolicy, syncTokenPolicy },
+                new HttpPipelinePolicy[] { new AudienceErrorHandlingPolicy(options.Audience != null), authenticationPolicy, syncTokenPolicy },
                 new ResponseClassifier());
         }
 
diff --git a/sdk/appconfiguration/Azure.Data.AppConfiguration/tests/AudienceErrorHandlingPolicyTests.cs b/sdk/appconfiguration/Azure.Data.AppConfiguration/tests/AudienceErrorHandlingPolicyTests.cs
new file mode 100644
index 000000000000..978c3ff82239
--- /dev/null
+++ b/sdk/appconfiguration/Azure.Data.AppConfiguration/tests/AudienceErrorHandlingPolicyTests.cs
@@ -0,0 +1,128 @@
+// Copyright (c) Microsoft Corporation. All rights reserved.
+// Licensed under the MIT License.
+
+using System;
+using System.Threading;
+using System.Threading.Tasks;
+using Azure.Core;
+using Azure.Core.Pipeline;
+using Azure.Core.TestFramework;
+using NUnit.Framework;
+
+namespace Azure.Data.AppConfiguration.Tests
+{
+    [TestFixture(true)]
+    [TestFixture(false)]
+    public class AudienceErrorHandlingPolicyTests : SyncAsyncPolicyTestBase
+    {
+        private const string AadAudienceErrorCode = "AADSTS500011"; // Must match code in AudienceErrorHandlingPolicy
+
+        public AudienceErrorHandlingPolicyTests(bool isAsync) : base(isAsync)
+        {
+        }
+
+        private static string ExpectedErrorMessage(bool isAudienceConfigured)
+        {
+            string leading = "Unable to authenticate to Azure App Configuration.";
+            string detail = isAudienceConfigured
+                ? " An incorrect token audience was provided."
+                : " No authentication token audience was provided.";
+            string guidance = $" Please set {nameof(ConfigurationClientOptions)}.{nameof(ConfigurationClientOptions.Audience)} to the appropriate audience for the target cloud. For details on how to configure the authentication token audience visit https://aka.ms/appconfig/client-token-audience.";
+            return leading + detail + guidance;
+        }
+
+        private class ThrowingPolicy : HttpPipelinePolicy
+        {
+            private readonly string _message;
+            public ThrowingPolicy(string message) => _message = message;
+            public override void Process(HttpMessage message, ReadOnlyMemory<HttpPipelinePolicy> pipeline)
+            {
+                throw new Exception(_message);
+            }
+            public override ValueTask ProcessAsync(HttpMessage message, ReadOnlyMemory<HttpPipelinePolicy> pipeline)
+            {
+                throw new Exception(_message);
+            }
+        }
+
+        [Test]
+        public void WrapsError_NoAudienceConfigured() => AssertWrapsError(isAudienceConfigured: false);
+
+        [Test]
+        public void WrapsError_WrongAudienceConfigured() => AssertWrapsError(isAudienceConfigured: true);
+
+        [Test]
+        public void NonAudienceError_PassesThrough()
+        {
+            var transport = new MockTransport(new MockResponse(200));
+            var pipeline = new HttpPipeline(
+                transport,
+                new HttpPipelinePolicy[]
+                {
+                    new AudienceErrorHandlingPolicy(isAudienceConfigured: true), // value irrelevant since code won't match
+                    new ThrowingPolicy("Simulated failure WITHOUT code")
+                },
+                responseClassifier: null);
+
+            var requestUri = new Uri("http://example.com");
+
+            Exception ex = Assert.ThrowsAsync<Exception>(async () =>
+            {
+                if (IsAsync)
+                {
+                    var message = pipeline.CreateMessage();
+                    message.Request.Method = RequestMethod.Get;
+                    message.Request.Uri.Reset(requestUri);
+                    await pipeline.SendAsync(message, CancellationToken.None);
+                }
+                else
+                {
+                    var message = pipeline.CreateMessage();
+                    message.Request.Method = RequestMethod.Get;
+                    message.Request.Uri.Reset(requestUri);
+                    pipeline.Send(message, CancellationToken.None);
+                }
+            });
+
+            Assert.IsNotInstanceOf<RequestFailedException>(ex); // Should not be wrapped
+            Assert.AreEqual("Simulated failure WITHOUT code", ex.Message);
+        }
+
+        private void AssertWrapsError(bool isAudienceConfigured)
+        {
+            var transport = new MockTransport(new MockResponse(200)); // Transport won't be reached because throwing policy throws first.
+            var pipeline = new HttpPipeline(
+                transport,
+                new HttpPipelinePolicy[]
+                {
+                    new AudienceErrorHandlingPolicy(isAudienceConfigured),
+                    new ThrowingPolicy($"Simulated authentication failure {AadAudienceErrorCode}: Resource principal not found")
+                },
+                responseClassifier: null);
+
+            var requestUri = new Uri("http://example.com");
+            RequestFailedException ex = Assert.ThrowsAsync<RequestFailedException>(async () =>
+            {
+                if (IsAsync)
+                {
+                    var message = pipeline.CreateMessage();
+                    message.Request.Method = RequestMethod.Get;
+                    message.Request.Uri.Reset(requestUri);
+                    await pipeline.SendAsync(message, CancellationToken.None);
+                }
+                else
+                {
+                    var message = pipeline.CreateMessage();
+                    message.Request.Method = RequestMethod.Get;
+                    message.Request.Uri.Reset(requestUri);
+                    pipeline.Send(message, CancellationToken.None);
+                }
+            });
+
+            Assert.NotNull(ex);
+            StringAssert.Contains(ExpectedErrorMessage(isAudienceConfigured), ex.Message);
+            Assert.NotNull(ex.InnerException);
+            StringAssert.Contains(AadAudienceErrorCode, ex.InnerException.Message);
+        }
+    }
+}