diff --git a/changes/issue-11416-return-400-for-auth-error b/changes/issue-11416-return-400-for-auth-error
new file mode 100644
index 0000000000..32610498f9
--- /dev/null
+++ b/changes/issue-11416-return-400-for-auth-error
@@ -0,0 +1 @@
+* Updated the `/api/latest/fleet/mdm/apple_bm` to return 400 instead of 500 when it fails to authenticate with Apple's Business Manager API, as this indicates a Fleet configuration issue with the Apple BM certificate or token.
diff --git a/ee/server/service/mdm.go b/ee/server/service/mdm.go
index f3c96ec880..733ac03426 100644
--- a/ee/server/service/mdm.go
+++ b/ee/server/service/mdm.go
@@ -8,6 +8,7 @@ import (
 	"encoding/json"
 	"errors"
 	"io"
+	"net/http"
 	"net/url"
 	"strings"
 
@@ -23,6 +24,7 @@ import (
 	kitlog "github.com/go-kit/kit/log"
 	"github.com/go-kit/kit/log/level"
 	"github.com/google/uuid"
+	depclient "github.com/micromdm/nanodep/client"
 	"github.com/micromdm/nanodep/storage"
 )
 
@@ -66,6 +68,20 @@ func getAppleBMAccountDetail(ctx context.Context, depStorage storage.AllStorage,
 	depClient := apple_mdm.NewDEPClient(depStorage, ds, logger)
 	res, err := depClient.AccountDetail(ctx, apple_mdm.DEPName)
 	if err != nil {
+		var authErr *depclient.AuthError
+		if errors.As(err, &authErr) {
+			// authentication failure with 401 unauthorized means that the configured
+			// Apple BM certificate and/or token are invalid. Fail with a 400 Bad
+			// Request.
+			msg := err.Error()
+			if authErr.StatusCode == http.StatusUnauthorized {
+				msg = "The Apple Business Manager certificate or server token is invalid. Restart Fleet with a valid certificate and token. See https://fleetdm.com/docs/using-fleet/mdm-setup#apple-business-manager-abm for help."
+			}
+			return nil, ctxerr.Wrap(ctx, &fleet.BadRequestError{
+				Message:     msg,
+				InternalErr: err,
+			}, "apple GET /account request failed with authentication error")
+		}
 		return nil, ctxerr.Wrap(ctx, err, "apple GET /account request failed")
 	}
 
diff --git a/server/service/integration_mdm_test.go b/server/service/integration_mdm_test.go
index 3b23d8f92b..167dbbe347 100644
--- a/server/service/integration_mdm_test.go
+++ b/server/service/integration_mdm_test.go
@@ -301,19 +301,50 @@ func (s *integrationMDMTestSuite) TestAppleGetAppleMDM() {
 
 func (s *integrationMDMTestSuite) TestABMExpiredToken() {
 	t := s.T()
+	var returnType string
 	s.mockDEPResponse(http.HandlerFunc(func(w http.ResponseWriter, r *http.Request) {
-		w.WriteHeader(http.StatusForbidden)
-		_, _ = w.Write([]byte(`{"code": "T_C_NOT_SIGNED"}`))
+		switch returnType {
+		case "not_signed":
+			w.WriteHeader(http.StatusForbidden)
+			_, _ = w.Write([]byte(`{"code": "T_C_NOT_SIGNED"}`))
+		case "unauthorized":
+			w.WriteHeader(http.StatusUnauthorized)
+			_, _ = w.Write([]byte(`{}`))
+		case "success":
+			w.WriteHeader(http.StatusOK)
+			_, _ = w.Write([]byte(`{"auth_session_token": "abcd"}`))
+		default:
+			require.Fail(t, "unexpected return type: %s", returnType)
+		}
 	}))
 
 	config := s.getConfig()
 	require.False(t, config.MDM.AppleBMTermsExpired)
 
-	var getAppleBMResp getAppleBMResponse
-	s.DoJSON("GET", "/api/latest/fleet/mdm/apple_bm", nil, http.StatusInternalServerError, &getAppleBMResp)
+	// not signed error flips the AppleBMTermsExpired flag
+	returnType = "not_signed"
+	res := s.DoRaw("GET", "/api/latest/fleet/mdm/apple_bm", nil, http.StatusBadRequest)
+	errMsg := extractServerErrorText(res.Body)
+	require.Contains(t, errMsg, "DEP auth error: 403 Forbidden")
 
 	config = s.getConfig()
 	require.True(t, config.MDM.AppleBMTermsExpired)
+
+	// a successful call clears it
+	returnType = "success"
+	s.DoRaw("GET", "/api/latest/fleet/mdm/apple_bm", nil, http.StatusOK)
+
+	config = s.getConfig()
+	require.False(t, config.MDM.AppleBMTermsExpired)
+
+	// an unauthorized call returns 400 but does not flip the terms expired flag
+	returnType = "unauthorized"
+	res = s.DoRaw("GET", "/api/latest/fleet/mdm/apple_bm", nil, http.StatusBadRequest)
+	errMsg = extractServerErrorText(res.Body)
+	require.Contains(t, errMsg, "Apple Business Manager certificate or server token is invalid")
+
+	config = s.getConfig()
+	require.False(t, config.MDM.AppleBMTermsExpired)
 }
 
 func (s *integrationMDMTestSuite) TestProfileManagement() {