diff --git a/acceptance/bundle/deploy/yaml-sync-empty-grants/databricks.yml b/acceptance/bundle/deploy/yaml-sync-empty-grants/databricks.yml
new file mode 100644
index 00000000000..87958c8e630
--- /dev/null
+++ b/acceptance/bundle/deploy/yaml-sync-empty-grants/databricks.yml
@@ -0,0 +1,9 @@
+bundle:
+  name: yaml-sync-empty-grants
+
+resources:
+  schemas:
+    schema1:
+      name: myschema
+      catalog_name: main
+      grants: []
diff --git a/acceptance/bundle/deploy/yaml-sync-empty-grants/out.test.toml b/acceptance/bundle/deploy/yaml-sync-empty-grants/out.test.toml
new file mode 100644
index 00000000000..65156e0457c
--- /dev/null
+++ b/acceptance/bundle/deploy/yaml-sync-empty-grants/out.test.toml
@@ -0,0 +1,3 @@
+Local = true
+Cloud = false
+EnvMatrix.DATABRICKS_BUNDLE_ENGINE = ["terraform"]
diff --git a/acceptance/bundle/deploy/yaml-sync-empty-grants/output.txt b/acceptance/bundle/deploy/yaml-sync-empty-grants/output.txt
new file mode 100644
index 00000000000..fa2643665d8
--- /dev/null
+++ b/acceptance/bundle/deploy/yaml-sync-empty-grants/output.txt
@@ -0,0 +1,8 @@
+
+>>> [CLI] bundle deploy
+Uploading bundle files to /Workspace/Users/[USERNAME]/.bundle/yaml-sync-empty-grants/default/files...
+Deploying resources...
+Updating deployment state...
+Warn: Failed to create config snapshot: state conversion failed
+Warn: Config snapshot: state entry not found for "resources.schemas.schema1.grants"
+Deployment complete!
diff --git a/acceptance/bundle/deploy/yaml-sync-empty-grants/script b/acceptance/bundle/deploy/yaml-sync-empty-grants/script
new file mode 100644
index 00000000000..68ebb78d775
--- /dev/null
+++ b/acceptance/bundle/deploy/yaml-sync-empty-grants/script
@@ -0,0 +1 @@
+trace $CLI bundle deploy
diff --git a/acceptance/bundle/deploy/yaml-sync-empty-grants/test.toml b/acceptance/bundle/deploy/yaml-sync-empty-grants/test.toml
new file mode 100644
index 00000000000..5799c23b638
--- /dev/null
+++ b/acceptance/bundle/deploy/yaml-sync-empty-grants/test.toml
@@ -0,0 +1,6 @@
+# The YAML-sync state upload only runs for the terraform engine; no direct-engine variant.
+[Env]
+DATABRICKS_BUNDLE_ENABLE_EXPERIMENTAL_YAML_SYNC = "true"
+
+[EnvMatrix]
+DATABRICKS_BUNDLE_ENGINE = ["terraform"]
diff --git a/bundle/statemgmt/upload_state_for_yaml_sync.go b/bundle/statemgmt/upload_state_for_yaml_sync.go
index 0399c7b31ff..6573d1dc56f 100644
--- a/bundle/statemgmt/upload_state_for_yaml_sync.go
+++ b/bundle/statemgmt/upload_state_for_yaml_sync.go
@@ -54,6 +54,20 @@ func (m *uploadStateForYamlSync) Apply(ctx context.Context, b *bundle.Bundle) di
 		return nil
 	}
 
+	// convertState reuses direct-engine code that reports failures via logdiag,
+	// and this mutator must not fail a deploy that already succeeded.
+	ctx = logdiag.IsolatedContext(ctx)
+	logdiag.SetCollect(ctx, true)
+	defer func() {
+		for _, d := range logdiag.FlushCollected(ctx) {
+			msg := d.Summary
+			if d.Detail != "" {
+				msg += ": " + d.Detail
+			}
+			log.Warnf(ctx, "Config snapshot: %s", msg)
+		}
+	}()
+
 	_, snapshotPath := b.StateFilenameConfigSnapshot(ctx)
 
 	created, err := m.convertState(ctx, b, snapshotPath)
@@ -202,6 +216,12 @@ func (m *uploadStateForYamlSync) convertState(ctx context.Context, b *bundle.Bun
 		return false, err
 	}
 
+	// Apply reports failures via logdiag instead of returning an error. Don't
+	// upload a snapshot that is missing entries for the failed resources.
+	if logdiag.HasError(ctx) {
+		return false, errors.New("state conversion failed")
+	}
+
 	return true, nil
 }
 
diff --git a/libs/logdiag/logdiag.go b/libs/logdiag/logdiag.go
index 896d105751b..28ed3b5ba21 100644
--- a/libs/logdiag/logdiag.go
+++ b/libs/logdiag/logdiag.go
@@ -48,6 +48,12 @@ func InitContext(ctx context.Context) context.Context {
 	if ok {
 		panic("internal error: must not call InitContext() twice")
 	}
+	return IsolatedContext(ctx)
+}
+
+// IsolatedContext returns a child context with a fresh diagnostics state;
+// diagnostics logged through it do not affect the parent's.
+func IsolatedContext(ctx context.Context) context.Context {
 	val := LogDiagData{
 		TargetSeverity: 255,
 		mu:             &sync.Mutex{},
diff --git a/libs/logdiag/logdiag_test.go b/libs/logdiag/logdiag_test.go
new file mode 100644
index 00000000000..ecf12ee78d1
--- /dev/null
+++ b/libs/logdiag/logdiag_test.go
@@ -0,0 +1,24 @@
+package logdiag_test
+
+import (
+	"errors"
+	"testing"
+
+	"github.com/databricks/cli/libs/logdiag"
+	"github.com/stretchr/testify/assert"
+)
+
+func TestIsolatedContext(t *testing.T) {
+	ctx := logdiag.InitContext(t.Context())
+	logdiag.SetCollect(ctx, true)
+
+	isolated := logdiag.IsolatedContext(ctx)
+	logdiag.SetCollect(isolated, true)
+	logdiag.LogError(isolated, errors.New("inner failure"))
+
+	assert.True(t, logdiag.HasError(isolated))
+	assert.Len(t, logdiag.FlushCollected(isolated), 1)
+
+	assert.False(t, logdiag.HasError(ctx))
+	assert.Empty(t, logdiag.FlushCollected(ctx))
+}