diff --git a/src/ap2/types/__init__.py b/src/ap2/types/__init__.py
index 9240c2aa..18107edc 100644
--- a/src/ap2/types/__init__.py
+++ b/src/ap2/types/__init__.py
@@ -11,3 +11,25 @@
 # WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
 # See the License for the specific language governing permissions and
 # limitations under the License.
+
+"""AP2 type definitions."""
+
+from ap2.types.errors import (
+    FAILURE_RESPONSE_DATA_KEY,
+    FailureCategory,
+    FailureResponse,
+    ItemRejectionReason,
+    PaymentDeclineCode,
+    RecoveryAction,
+    RejectedItem,
+)
+
+__all__ = [
+    "FAILURE_RESPONSE_DATA_KEY",
+    "FailureCategory",
+    "FailureResponse",
+    "ItemRejectionReason",
+    "PaymentDeclineCode",
+    "RecoveryAction",
+    "RejectedItem",
+]
diff --git a/src/ap2/types/errors.py b/src/ap2/types/errors.py
new file mode 100644
index 00000000..33985a52
--- /dev/null
+++ b/src/ap2/types/errors.py
@@ -0,0 +1,240 @@
+# Copyright 2025 Google LLC
+#
+# Licensed under the Apache License, Version 2.0 (the "License");
+# you may not use this file except in compliance with the License.
+# You may obtain a copy of the License at
+#
+#     https://www.apache.org/licenses/LICENSE-2.0
+#
+# Unless required by applicable law or agreed to in writing, software
+# distributed under the License is distributed on an "AS IS" BASIS,
+# WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+# See the License for the specific language governing permissions and
+# limitations under the License.
+
+"""Standard error and failure response types for the Agent Payments Protocol.
+
+These types define a consistent structure for communicating failure states
+between agents, enabling predictable error handling and recovery flows.
+
+Failure scenarios addressed:
+- Mandate expiration during multi-step flows
+- Price drift beyond mandate constraints
+- Payment decline / PSP rejection
+- Partial cart rejection (out of stock, unavailable items)
+- Validation errors
+
+Usage:
+    from ap2.types.errors import FailureResponse, FailureCategory, RecoveryAction
+
+    failure = FailureResponse(
+        category=FailureCategory.PRICE_DRIFT,
+        message="Final price exceeds original quote by 15%",
+        recovery_action=RecoveryAction.USER_CONFIRMATION_REQUIRED,
+        original_value={"amount": 100.00, "currency": "USD"},
+        actual_value={"amount": 115.00, "currency": "USD"}
+    )
+"""
+
+from enum import Enum
+from typing import Any, Optional
+
+from pydantic import BaseModel
+from pydantic import Field
+
+
+FAILURE_RESPONSE_DATA_KEY = "ap2.errors.FailureResponse"
+
+
+class FailureCategory(str, Enum):
+    """Categories of failures that can occur in agent payment flows.
+
+    These categories help agents quickly identify the type of failure and
+    determine appropriate recovery strategies.
+    """
+
+    MANDATE_EXPIRED = "MANDATE_EXPIRED"
+    """The intent or cart mandate has expired before transaction completion."""
+
+    PRICE_DRIFT = "PRICE_DRIFT"
+    """The final price exceeds the original quote or mandate price constraints."""
+
+    PAYMENT_DECLINED = "PAYMENT_DECLINED"
+    """The payment was declined by the PSP, issuer, or payment network."""
+
+    CART_MODIFIED = "CART_MODIFIED"
+    """The cart contents were modified (items unavailable, quantities changed)."""
+
+    MERCHANT_REJECTION = "MERCHANT_REJECTION"
+    """The merchant rejected the order (policy violation, risk, etc.)."""
+
+    VALIDATION_ERROR = "VALIDATION_ERROR"
+    """The request failed validation (missing fields, invalid format, etc.)."""
+
+    CONSTRAINT_VIOLATED = "CONSTRAINT_VIOLATED"
+    """A mandate constraint was violated (merchant not allowed, SKU not permitted, etc.)."""
+
+
+class RecoveryAction(str, Enum):
+    """Recommended recovery actions for failure scenarios.
+
+    These actions guide the calling agent on how to proceed after a failure.
+    """
+
+    PROCEED_WITH_NOTICE = "PROCEED_WITH_NOTICE"
+    """Change is within tolerance; proceed but inform the user."""
+
+    RETRY_ALLOWED = "RETRY_ALLOWED"
+    """The operation can be retried with the same parameters."""
+
+    USER_CONFIRMATION_REQUIRED = "USER_CONFIRMATION_REQUIRED"
+    """The user must confirm before proceeding (price change, cart modification)."""
+
+    NEW_MANDATE_REQUIRED = "NEW_MANDATE_REQUIRED"
+    """The current mandate is invalid; a new mandate must be obtained from the user."""
+
+    ALTERNATIVE_PAYMENT_REQUIRED = "ALTERNATIVE_PAYMENT_REQUIRED"
+    """The current payment method failed; an alternative method is needed."""
+
+    ABORT_TRANSACTION = "ABORT_TRANSACTION"
+    """The transaction cannot proceed and should be terminated."""
+
+
+class PaymentDeclineCode(str, Enum):
+    """Common payment decline reason codes from PSPs and issuers.
+
+    These codes help agents understand why a payment was declined and
+    determine appropriate user communication and recovery actions.
+    """
+
+    INSUFFICIENT_FUNDS = "INSUFFICIENT_FUNDS"
+    """The account has insufficient funds for the transaction."""
+
+    CARD_EXPIRED = "CARD_EXPIRED"
+    """The payment card has expired."""
+
+    CARD_NOT_SUPPORTED = "CARD_NOT_SUPPORTED"
+    """The card type is not supported by the merchant."""
+
+    CVV_MISMATCH = "CVV_MISMATCH"
+    """The security code (CVV/CVC) is incorrect."""
+
+    RISK_REJECTED = "RISK_REJECTED"
+    """The transaction was rejected due to fraud/risk rules."""
+
+    SCA_REQUIRED = "SCA_REQUIRED"
+    """Strong Customer Authentication (3DS, biometric) is required."""
+
+    LIMIT_EXCEEDED = "LIMIT_EXCEEDED"
+    """The transaction exceeds the account's spending limit."""
+
+    ISSUER_UNAVAILABLE = "ISSUER_UNAVAILABLE"
+    """The card issuer is temporarily unavailable."""
+
+    GENERIC_DECLINE = "GENERIC_DECLINE"
+    """The payment was declined without a specific reason."""
+
+
+class ItemRejectionReason(str, Enum):
+    """Reasons why an item may be rejected from a cart.
+
+    Used in partial cart rejection scenarios to explain why specific
+    items cannot be fulfilled.
+    """
+
+    OUT_OF_STOCK = "OUT_OF_STOCK"
+    """The item is currently out of stock."""
+
+    DISCONTINUED = "DISCONTINUED"
+    """The item has been discontinued and is no longer available."""
+
+    REGION_RESTRICTED = "REGION_RESTRICTED"
+    """The item cannot be shipped to the specified region."""
+
+    QUANTITY_UNAVAILABLE = "QUANTITY_UNAVAILABLE"
+    """The requested quantity is not available."""
+
+    PRICE_CHANGED = "PRICE_CHANGED"
+    """The item's price has changed since it was added to the cart."""
+
+
+class RejectedItem(BaseModel):
+    """Details about an item that was rejected from a cart."""
+
+    sku: str = Field(
+        ...,
+        description="The SKU or product identifier of the rejected item."
+    )
+    reason: ItemRejectionReason = Field(
+        ...,
+        description="The reason why the item was rejected."
+    )
+    message: Optional[str] = Field(
+        None,
+        description="Additional details about the rejection."
+    )
+    alternative_sku: Optional[str] = Field(
+        None,
+        description="An alternative product SKU that may satisfy the user's intent."
+    )
+
+
+class FailureResponse(BaseModel):
+    """Standard structure for communicating failures between agents.
+
+    This type enables consistent error handling across the agent ecosystem.
+    All agents SHOULD use this structure when communicating failure states
+    to ensure predictable behavior and recovery flows.
+
+    Example:
+        ```python
+        failure = FailureResponse(
+            category=FailureCategory.PRICE_DRIFT,
+            message="Price increased from $100 to $115 (15% drift)",
+            recovery_action=RecoveryAction.USER_CONFIRMATION_REQUIRED,
+            original_value={"amount": 100.00, "currency": "USD"},
+            actual_value={"amount": 115.00, "currency": "USD"},
+            details={"drift_percent": 15.0, "tolerance_percent": 5.0}
+        )
+        ```
+    """
+
+    category: FailureCategory = Field(
+        ...,
+        description="The category of failure that occurred."
+    )
+    message: str = Field(
+        ...,
+        description="Human-readable description of the failure suitable for logging or user display."
+    )
+    recovery_action: RecoveryAction = Field(
+        ...,
+        description=(
+            "Recommended action for the calling agent to take. "
+            "Use this as the single source of truth for determining next steps: "
+            "RETRY_ALLOWED implies retry is possible, "
+            "USER_CONFIRMATION_REQUIRED/NEW_MANDATE_REQUIRED/ALTERNATIVE_PAYMENT_REQUIRED "
+            "imply user action is needed."
+        )
+    )
+    details: Optional[dict[str, Any]] = Field(
+        None,
+        description="Additional context about the failure (e.g., decline codes, drift percentages)."
+    )
+    original_value: Optional[Any] = Field(
+        None,
+        description="The original/expected value (e.g., original price, original cart contents)."
+    )
+    actual_value: Optional[Any] = Field(
+        None,
+        description="The actual value that caused the failure (e.g., new price, modified cart)."
+    )
+    rejected_items: Optional[list[RejectedItem]] = Field(
+        None,
+        description="List of items that were rejected, for CART_MODIFIED failures."
+    )
+    decline_code: Optional[PaymentDeclineCode] = Field(
+        None,
+        description="The specific decline code, for PAYMENT_DECLINED failures."
+    )
+