diff --git a/pyproject.toml b/pyproject.toml
index 4f7042a1..05f1d1b8 100644
--- a/pyproject.toml
+++ b/pyproject.toml
@@ -1,6 +1,6 @@
 [project]
 name = "sap-cloud-sdk"
-version = "0.43.0"
+version = "0.43.1"
 description = "SAP Cloud SDK for Python"
 readme = "README.md"
 license = "Apache-2.0"
diff --git a/src/sap_cloud_sdk/destination/_models.py b/src/sap_cloud_sdk/destination/_models.py
index aa69a980..8667164c 100644
--- a/src/sap_cloud_sdk/destination/_models.py
+++ b/src/sap_cloud_sdk/destination/_models.py
@@ -413,6 +413,7 @@ class AuthToken:
         type: Token type (e.g., "Bearer", "Basic")
         value: Base64 encoded token binary content
         http_header: Dictionary with 'key' and 'value' for the prepared HTTP header
+        error: Error message returned by the Destination Service when token retrieval fails
         refresh_token: Optional base64 encoded refresh token
         scope: Optional token scopes as space-delimited string
     """
@@ -420,6 +421,7 @@ class AuthToken:
     type: str
     value: str
     http_header: Dict[str, str]
+    error: Optional[str] = None
     refresh_token: Optional[str] = None
     scope: Optional[str] = None
 
@@ -434,23 +436,28 @@ def from_dict(cls, obj: Dict[str, Any]) -> "AuthToken":
             AuthToken: Parsed auth token dataclass.
 
         Raises:
-            DestinationOperationError: If required fields are missing.
+            DestinationOperationError: If required fields are missing, or if the token
+                carries an error from the Destination Service.
         """
         token_type = obj.get("type") or ""
         value = obj.get("value") or ""
         http_header = obj.get("http_header") or {}
+        error = obj.get("error") or None
         refresh_token = obj.get("refresh_token")
         scope = obj.get("scope")
 
-        if not token_type or not value or not http_header:
+        if not error and (not token_type or not value or not http_header):
             raise DestinationOperationError(
                 "auth token is missing required fields (type/value/http_header)"
             )
+        if error and (not token_type or not value or not http_header):
+            raise DestinationOperationError(f"auth token retrieval failed: {error}")
 
         return cls(
             type=token_type,
             value=value,
             http_header=http_header,
+            error=error,
             refresh_token=refresh_token,
             scope=scope,
         )
diff --git a/tests/agentgateway/unit/test_lob.py b/tests/agentgateway/unit/test_lob.py
index 0f1b15e3..6d972b8d 100644
--- a/tests/agentgateway/unit/test_lob.py
+++ b/tests/agentgateway/unit/test_lob.py
@@ -89,6 +89,7 @@ def test_fetches_and_decodes_token_and_url(self):
         header_value = "Bearer my-raw-jwt-token-123"
         mock_dest = MagicMock()
         mock_dest.auth_tokens = [MagicMock()]
+        mock_dest.auth_tokens[0].error = None
         mock_dest.auth_tokens[0].http_header = {"value": header_value}
         mock_dest.url = "https://agw.example.com/"
 
@@ -112,6 +113,7 @@ def test_strips_trailing_slashes_from_url(self):
         header_value = "Bearer token"
         mock_dest = MagicMock()
         mock_dest.auth_tokens = [MagicMock()]
+        mock_dest.auth_tokens[0].error = None
         mock_dest.auth_tokens[0].http_header = {"value": header_value}
         mock_dest.url = "https://agw.example.com/v1/mcp///"
 
@@ -149,6 +151,7 @@ def test_raises_when_empty_token_value(self):
         """Raise MCPServerNotFoundError when http_header value is empty."""
         mock_dest = MagicMock()
         mock_dest.auth_tokens = [MagicMock()]
+        mock_dest.auth_tokens[0].error = None
         mock_dest.auth_tokens[0].http_header = {"value": ""}
 
         with patch(
@@ -163,6 +166,7 @@ def test_passes_options_to_destination(self):
         """Pass consumption options to get_destination."""
         mock_dest = MagicMock()
         mock_dest.auth_tokens = [MagicMock()]
+        mock_dest.auth_tokens[0].error = None
         mock_dest.auth_tokens[0].http_header = {"value": "Bearer token"}
         mock_dest.url = "https://agw.example.com"
         mock_options = MagicMock()
diff --git a/tests/destination/unit/test_models.py b/tests/destination/unit/test_models.py
index c72df1c6..3bb6a385 100644
--- a/tests/destination/unit/test_models.py
+++ b/tests/destination/unit/test_models.py
@@ -293,6 +293,39 @@ def test_get_headers_includes_auth_tokens(self):
         assert dest.get_headers()["Authorization"] == "Bearer eyJ123"
 
 
+class TestAuthTokenModel:
+    """Tests for AuthToken dataclass."""
+
+    def test_from_dict_valid(self):
+        """Parse a valid auth token dict."""
+        token = AuthToken.from_dict({
+            "type": "Bearer",
+            "value": "eyJ123",
+            "http_header": {"key": "Authorization", "value": "Bearer eyJ123"},
+        })
+        assert token.type == "Bearer"
+        assert token.value == "eyJ123"
+        assert token.error is None
+
+    def test_from_dict_with_error_field(self):
+        """Raise DestinationOperationError with the Destination Service error message."""
+        with pytest.raises(
+            DestinationOperationError,
+            match="No consumed apis matching provided resource parameter found.",
+        ):
+            AuthToken.from_dict({
+                "type": "",
+                "value": "",
+                "error": "No consumed apis matching provided resource parameter found.",
+                "expires_in": "0",
+            })
+
+    def test_from_dict_missing_fields_without_error_raises(self):
+        """Raise DestinationOperationError when required fields are missing and no error is set."""
+        with pytest.raises(DestinationOperationError, match="missing required fields"):
+            AuthToken.from_dict({"type": "", "value": "", "http_header": {}})
+
+
 class TestFragmentModel:
     """Tests for Fragment dataclass."""