diff --git a/pkgs/sdk/server-ai/src/LdAiClient.cs b/pkgs/sdk/server-ai/src/LdAiClient.cs
index 423fa67c..ea227e75 100644
--- a/pkgs/sdk/server-ai/src/LdAiClient.cs
+++ b/pkgs/sdk/server-ai/src/LdAiClient.cs
@@ -73,10 +73,28 @@ public ILdAiConfigTracker ModelConfig(string key, Context context, LdAiConfig de
         }
 
 
-        var prompt =
-            parsed.Prompt?.Select(m => new LdAiConfig.Message(InterpolateTemplate(m.Content, mergedVariables), m.Role));
+        var prompt = new List<LdAiConfig.Message>();
+
+        if (parsed.Prompt != null)
+        {
+            for (var i = 0; i < parsed.Prompt.Count; i++)
+            {
+                try
+                {
+                    var content = InterpolateTemplate(parsed.Prompt[i].Content, mergedVariables);
+                    prompt.Add(new LdAiConfig.Message(content, parsed.Prompt[i].Role));
+                }
+                catch (Exception ex)
+                {
+                    _logger.Error(
+                        $"AI model config prompt has malformed message at index {i}: {ex.Message} (returning default config, which will not contain interpolated prompt messages)");
+                    return new LdAiConfigTracker(_client, key, defaultValue, context);
+                }
+            }
+        }
 
         return new LdAiConfigTracker(_client, key, new LdAiConfig(parsed.Meta?.Enabled ?? false, prompt, parsed.Meta, parsed.Model), context);
+
     }
 
     /// <summary>
@@ -137,7 +155,8 @@ private AiConfig ParseConfig(LdValue value, string key)
         }
         catch (JsonException e)
         {
-            _logger.Error("Unable to parse AI model config for key {0}: {1}", key, e.Message);
+            _logger.Error(
+                $"Unable to parse AI model config for key {key}: {e.Message} (returning default config, which will not contain interpolated prompt messages)");
             return null;
         }
     }
diff --git a/pkgs/sdk/server-ai/test/InterpolationTests.cs b/pkgs/sdk/server-ai/test/InterpolationTests.cs
index d6256e9d..d7ddf163 100644
--- a/pkgs/sdk/server-ai/test/InterpolationTests.cs
+++ b/pkgs/sdk/server-ai/test/InterpolationTests.cs
@@ -1,3 +1,4 @@
+using System;
 using System.Collections.Generic;
 using System.Text.Json;
 using System.Text.Json.Serialization;
@@ -117,6 +118,37 @@ public void TestInterpolationWithArraySectionWorks()
         Assert.Equal("hello world ! ", result);
     }
 
+    [Fact]
+    public void TestInterpolationMalformed()
+    {
+        var mockClient = new Mock<ILaunchDarklyClient>();
+        var mockLogger = new Mock<ILogger>();
+
+        const string configJson = """
+                                  {
+                                      "_ldMeta": {"versionKey": "1", "enabled": true},
+                                      "model": {},
+                                      "prompt": [
+                                          {
+                                              "content": "This is a {{ malformed }]} prompt",
+                                              "role": "System"
+                                          }
+                                      ]
+                                  }
+                                  """;
+
+
+        mockClient.Setup(x =>
+            x.JsonVariation("foo", It.IsAny<Context>(), It.IsAny<LdValue>())).Returns(LdValue.Parse(configJson));
+
+        mockClient.Setup(x => x.GetLogger()).Returns(mockLogger.Object);
+
+        mockLogger.Setup(x => x.Error(It.IsAny<string>()));
+
+        var client = new LdAiClient(mockClient.Object);
+        var tracker = client.ModelConfig("foo", Context.New("key"), LdAiConfig.Disabled);
+        Assert.False(tracker.Config.Enabled);
+    }
 
     [Fact]
     public void TestInterpolationWithBasicContext()