diff --git a/llama_stack/distribution/routing_tables/toolgroups.py b/llama_stack/distribution/routing_tables/toolgroups.py
index b86f057bd..6a2e5a860 100644
--- a/llama_stack/distribution/routing_tables/toolgroups.py
+++ b/llama_stack/distribution/routing_tables/toolgroups.py
@@ -8,7 +8,7 @@ from typing import Any
 
 from llama_stack.apis.common.content_types import URL
 from llama_stack.apis.tools import ListToolGroupsResponse, ListToolsResponse, Tool, ToolGroup, ToolGroups
-from llama_stack.distribution.datatypes import ToolGroupWithOwner
+from llama_stack.distribution.datatypes import AuthenticationRequiredError, ToolGroupWithOwner
 from llama_stack.log import get_logger
 
 from .common import CommonRoutingTableImpl
@@ -53,7 +53,18 @@ class ToolGroupsRoutingTable(CommonRoutingTableImpl, ToolGroups):
         all_tools = []
         for toolgroup in toolgroups:
             if toolgroup.identifier not in self.toolgroups_to_tools:
-                await self._index_tools(toolgroup)
+                try:
+                    await self._index_tools(toolgroup)
+                except AuthenticationRequiredError:
+                    # Send authentication errors back to the client so it knows
+                    # that it needs to supply credentials for remote MCP servers.
+                    raise
+                except Exception as e:
+                    # Other errors that the client cannot fix are logged and
+                    # those specific toolgroups are skipped.
+                    logger.warning(f"Error listing tools for toolgroup {toolgroup.identifier}: {e}")
+                    logger.debug(e, exc_info=True)
+                    continue
             all_tools.extend(self.toolgroups_to_tools[toolgroup.identifier])
 
         return ListToolsResponse(data=all_tools)
diff --git a/tests/unit/distribution/routers/test_routing_tables.py b/tests/unit/distribution/routers/test_routing_tables.py
index 0eeb68167..ec158de63 100644
--- a/tests/unit/distribution/routers/test_routing_tables.py
+++ b/tests/unit/distribution/routers/test_routing_tables.py
@@ -10,6 +10,7 @@ from unittest.mock import AsyncMock
 
 import pytest
 
+from llama_stack.apis.common.content_types import URL
 from llama_stack.apis.common.type_system import NumberType
 from llama_stack.apis.datasets.datasets import Dataset, DatasetPurpose, URIDataSource
 from llama_stack.apis.datatypes import Api
@@ -296,3 +297,26 @@ async def test_tool_groups_routing_table(cached_disk_dist_registry):
     await table.unregister_toolgroup(toolgroup_id="test-toolgroup")
     tool_groups = await table.list_tool_groups()
     assert len(tool_groups.data) == 0
+
+
+@pytest.mark.asyncio
+async def test_tool_groups_routing_table_exception_handling(cached_disk_dist_registry):
+    """Test that the tool group routing table handles exceptions when listing tools, like if an MCP server is unreachable."""
+
+    exception_throwing_tool_groups_impl = ToolGroupsImpl()
+    exception_throwing_tool_groups_impl.list_runtime_tools = AsyncMock(side_effect=Exception("Test exception"))
+
+    table = ToolGroupsRoutingTable(
+        {"test_provider": exception_throwing_tool_groups_impl}, cached_disk_dist_registry, {}
+    )
+    await table.initialize()
+
+    await table.register_tool_group(
+        toolgroup_id="test-toolgroup-exceptions",
+        provider_id="test_provider",
+        mcp_endpoint=URL(uri="http://localhost:8479/foo/bar"),
+    )
+
+    tools = await table.list_tools(toolgroup_id="test-toolgroup-exceptions")
+
+    assert len(tools.data) == 0