diff --git a/src/client/common/utils/localize.ts b/src/client/common/utils/localize.ts
index 4401cab56176..c7bd51181fd1 100644
--- a/src/client/common/utils/localize.ts
+++ b/src/client/common/utils/localize.ts
@@ -468,7 +468,9 @@ export namespace CreateEnv {
         export const recreateDescription = l10n.t('Delete existing ".venv" environment and create a new one');
         export const useExisting = l10n.t('Use Existing');
         export const useExistingDescription = l10n.t('Use existing ".venv" environment with no changes to it');
-        export const existingVenvQuickPickPlaceholder = l10n.t('Use or Recreate existing environment?');
+        export const existingVenvQuickPickPlaceholder = l10n.t(
+            'Choose an option to handle the existing ".venv" environment',
+        );
         export const deletingEnvironmentProgress = l10n.t('Deleting existing ".venv" environment...');
         export const errorDeletingEnvironment = l10n.t('Error while deleting existing ".venv" environment.');
     }
diff --git a/src/client/pythonEnvironments/creation/provider/condaCreationProvider.ts b/src/client/pythonEnvironments/creation/provider/condaCreationProvider.ts
index 74a42808e609..7ca44c1b7eff 100644
--- a/src/client/pythonEnvironments/creation/provider/condaCreationProvider.ts
+++ b/src/client/pythonEnvironments/creation/provider/condaCreationProvider.ts
@@ -128,7 +128,9 @@ async function createCondaEnv(
             dispose();
             if (proc?.exitCode !== 0) {
                 traceError('Error while running venv creation script: ', progressAndTelemetry.getLastError());
-                deferred.reject(progressAndTelemetry.getLastError());
+                deferred.reject(
+                    progressAndTelemetry.getLastError() || `Conda env creation failed with exitCode: ${proc?.exitCode}`,
+                );
             } else {
                 deferred.resolve(condaEnvPath);
             }
@@ -249,7 +251,7 @@ async function createEnvironment(options?: CreateEnvironmentOptions): Promise<Cr
             } catch (ex) {
                 traceError(ex);
                 showErrorMessageWithLogs(CreateEnv.Conda.errorCreatingEnvironment);
-                throw ex;
+                return { error: ex as Error };
             }
         },
     );
diff --git a/src/client/pythonEnvironments/creation/provider/venvCreationProvider.ts b/src/client/pythonEnvironments/creation/provider/venvCreationProvider.ts
index ba47edcf6f30..edbdcd7d84a6 100644
--- a/src/client/pythonEnvironments/creation/provider/venvCreationProvider.ts
+++ b/src/client/pythonEnvironments/creation/provider/venvCreationProvider.ts
@@ -120,7 +120,10 @@ async function createVenv(
             dispose();
             if (proc?.exitCode !== 0) {
                 traceError('Error while running venv creation script: ', progressAndTelemetry.getLastError());
-                deferred.reject(progressAndTelemetry.getLastError());
+                deferred.reject(
+                    progressAndTelemetry.getLastError() ||
+                        `Failed to create virtual environment with exitCode: ${proc?.exitCode}`,
+                );
             } else {
                 deferred.resolve(venvPath);
             }
@@ -327,7 +330,7 @@ export class VenvCreationProvider implements CreateEnvironmentProvider {
                 } catch (ex) {
                     traceError(ex);
                     showErrorMessageWithLogs(CreateEnv.Venv.errorCreatingEnvironment);
-                    throw ex;
+                    return { error: ex as Error };
                 }
             },
         );
diff --git a/src/test/pythonEnvironments/creation/provider/condaCreationProvider.unit.test.ts b/src/test/pythonEnvironments/creation/provider/condaCreationProvider.unit.test.ts
index 3fcadc42ba09..e1ac1bafe6ac 100644
--- a/src/test/pythonEnvironments/creation/provider/condaCreationProvider.unit.test.ts
+++ b/src/test/pythonEnvironments/creation/provider/condaCreationProvider.unit.test.ts
@@ -185,7 +185,8 @@ suite('Conda Creation provider tests', () => {
         assert.isDefined(_error);
         _error!('bad arguments');
         _complete!();
-        await assert.isRejected(promise);
+        const result = await promise;
+        assert.ok(result?.error);
         assert.isTrue(showErrorMessageWithLogsStub.calledOnce);
     });
 
@@ -241,7 +242,8 @@ suite('Conda Creation provider tests', () => {
 
         _next!({ out: `${CONDA_ENV_CREATED_MARKER}new_environment`, source: 'stdout' });
         _complete!();
-        await assert.isRejected(promise);
+        const result = await promise;
+        assert.ok(result?.error);
         assert.isTrue(showErrorMessageWithLogsStub.calledOnce);
     });
 });
diff --git a/src/test/pythonEnvironments/creation/provider/venvCreationProvider.unit.test.ts b/src/test/pythonEnvironments/creation/provider/venvCreationProvider.unit.test.ts
index 280d05bf5935..de65887b7edc 100644
--- a/src/test/pythonEnvironments/creation/provider/venvCreationProvider.unit.test.ts
+++ b/src/test/pythonEnvironments/creation/provider/venvCreationProvider.unit.test.ts
@@ -226,7 +226,8 @@ suite('venv Creation provider tests', () => {
         assert.isDefined(_error);
         _error!('bad arguments');
         _complete!();
-        await assert.isRejected(promise);
+        const result = await promise;
+        assert.ok(result?.error);
         assert.isTrue(showErrorMessageWithLogsStub.calledOnce);
         assert.isTrue(deleteEnvironmentStub.notCalled);
     });
@@ -283,7 +284,8 @@ suite('venv Creation provider tests', () => {
 
         _next!({ out: `${VENV_CREATED_MARKER}new_environment`, source: 'stdout' });
         _complete!();
-        await assert.isRejected(promise);
+        const result = await promise;
+        assert.ok(result?.error);
         interpreterQuickPick.verifyAll();
         progressMock.verifyAll();
         assert.isTrue(showErrorMessageWithLogsStub.calledOnce);