diff --git a/coderd/prebuilds/api.go b/coderd/prebuilds/api.go
index 2342da5d62..00129eae37 100644
--- a/coderd/prebuilds/api.go
+++ b/coderd/prebuilds/api.go
@@ -9,7 +9,10 @@ import (
 	"github.com/coder/coder/v2/coderd/database"
 )
 
-var ErrNoClaimablePrebuiltWorkspaces = xerrors.New("no claimable prebuilt workspaces found")
+var (
+	ErrNoClaimablePrebuiltWorkspaces        = xerrors.New("no claimable prebuilt workspaces found")
+	ErrAGPLDoesNotSupportPrebuiltWorkspaces = xerrors.New("prebuilt workspaces functionality is not supported under the AGPL license")
+)
 
 // ReconciliationOrchestrator manages the lifecycle of prebuild reconciliation.
 // It runs a continuous loop to check and reconcile prebuild states, and can be stopped gracefully.
diff --git a/coderd/prebuilds/noop.go b/coderd/prebuilds/noop.go
index e3dc0597b1..6fb3f7c6a5 100644
--- a/coderd/prebuilds/noop.go
+++ b/coderd/prebuilds/noop.go
@@ -27,7 +27,7 @@ type NoopClaimer struct{}
 
 func (NoopClaimer) Claim(context.Context, uuid.UUID, string, uuid.UUID) (*uuid.UUID, error) {
 	// Not entitled to claim prebuilds in AGPL version.
-	return nil, ErrNoClaimablePrebuiltWorkspaces
+	return nil, ErrAGPLDoesNotSupportPrebuiltWorkspaces
 }
 
 func (NoopClaimer) Initiator() uuid.UUID {
diff --git a/coderd/workspaces.go b/coderd/workspaces.go
index 12b3787acf..2ac432d905 100644
--- a/coderd/workspaces.go
+++ b/coderd/workspaces.go
@@ -650,8 +650,28 @@ func createWorkspace(
 		if req.TemplateVersionPresetID != uuid.Nil {
 			// Try and claim an eligible prebuild, if available.
 			claimedWorkspace, err = claimPrebuild(ctx, prebuildsClaimer, db, api.Logger, req, owner)
-			if err != nil && !errors.Is(err, prebuilds.ErrNoClaimablePrebuiltWorkspaces) {
-				return xerrors.Errorf("claim prebuild: %w", err)
+			// If claiming fails with an expected error (no claimable prebuilds or AGPL does not support prebuilds),
+			// we fall back to creating a new workspace. Otherwise, propagate the unexpected error.
+			if err != nil {
+				isExpectedError := errors.Is(err, prebuilds.ErrNoClaimablePrebuiltWorkspaces) ||
+					errors.Is(err, prebuilds.ErrAGPLDoesNotSupportPrebuiltWorkspaces)
+				fields := []any{
+					slog.Error(err),
+					slog.F("workspace_name", req.Name),
+					slog.F("template_version_preset_id", req.TemplateVersionPresetID),
+				}
+
+				if !isExpectedError {
+					// if it's an unexpected error - use error log level
+					api.Logger.Error(ctx, "failed to claim prebuilt workspace", fields...)
+
+					return xerrors.Errorf("failed to claim prebuilt workspace: %w", err)
+				}
+
+				// if it's an expected error - use warn log level
+				api.Logger.Warn(ctx, "failed to claim prebuilt workspace", fields...)
+
+				// fall back to creating a new workspace
 			}
 		}
 
diff --git a/enterprise/coderd/prebuilds/claim_test.go b/enterprise/coderd/prebuilds/claim_test.go
index 5d75b74634..145095e653 100644
--- a/enterprise/coderd/prebuilds/claim_test.go
+++ b/enterprise/coderd/prebuilds/claim_test.go
@@ -111,6 +111,11 @@ func TestClaimPrebuild(t *testing.T) {
 			markPrebuildsClaimable: true,
 			claimingErr:            agplprebuilds.ErrNoClaimablePrebuiltWorkspaces,
 		},
+		"AGPL does not support prebuilds error is returned": {
+			expectPrebuildClaimed:  false,
+			markPrebuildsClaimable: true,
+			claimingErr:            agplprebuilds.ErrAGPLDoesNotSupportPrebuiltWorkspaces,
+		},
 		"unexpected claiming error is returned": {
 			expectPrebuildClaimed:  false,
 			markPrebuildsClaimable: true,
@@ -224,8 +229,11 @@ func TestClaimPrebuild(t *testing.T) {
 				TemplateVersionPresetID: presets[0].ID,
 			})
 
+			isNoPrebuiltWorkspaces := errors.Is(tc.claimingErr, agplprebuilds.ErrNoClaimablePrebuiltWorkspaces)
+			isUnsupported := errors.Is(tc.claimingErr, agplprebuilds.ErrAGPLDoesNotSupportPrebuiltWorkspaces)
+
 			switch {
-			case tc.claimingErr != nil && errors.Is(tc.claimingErr, agplprebuilds.ErrNoClaimablePrebuiltWorkspaces):
+			case tc.claimingErr != nil && (isNoPrebuiltWorkspaces || isUnsupported):
 				require.NoError(t, err)
 				coderdtest.AwaitWorkspaceBuildJobCompleted(t, userClient, userWorkspace.LatestBuild.ID)