diff --git a/apps/studio/components/interfaces/Organization/NewOrg/NewOrgForm.tsx b/apps/studio/components/interfaces/Organization/NewOrg/NewOrgForm.tsx
index a7c147df6d1..c21083f1d1f 100644
--- a/apps/studio/components/interfaces/Organization/NewOrg/NewOrgForm.tsx
+++ b/apps/studio/components/interfaces/Organization/NewOrg/NewOrgForm.tsx
@@ -58,6 +58,12 @@ import { useLastVisitedOrganization } from '@/hooks/misc/useLastVisitedOrganizat
 import { PRICING_TIER_LABELS_ORG, STRIPE_PUBLIC_KEY } from '@/lib/constants'
 import { validateReturnTo } from '@/lib/gotrue'
 import { useProfile } from '@/lib/profile'
+import {
+  classifyApiError,
+  classifyStripeError,
+  classifyValidationError,
+} from '@/lib/telemetry/funnel-errors'
+import { useTrackFunnelError } from '@/lib/telemetry/use-track-funnel-error'
 
 interface NewOrgFormProps {
   onPaymentMethodReset: () => void
@@ -226,6 +232,8 @@ export const NewOrgForm = ({
     [freeOrgs, projectsByOrg]
   )
 
+  const trackFunnelError = useTrackFunnelError()
+
   const { mutate: createOrganization } = useOrganizationCreateMutation({
     onSuccess: async (org) => {
       if ('pending_payment_intent_secret' in org && org.pending_payment_intent_secret) {
@@ -236,6 +244,7 @@ export const NewOrgForm = ({
     },
     onError: (data) => {
       toast.error(data.message, { duration: 10_000 })
+      trackFunnelError('org_creation', classifyApiError('org_creation', data), 'toast')
       setNewOrgLoading(false)
     },
   })
@@ -246,6 +255,10 @@ export const NewOrgForm = ({
         onOrganizationCreated({ slug: data.slug })
       }
     },
+    onError: (error) => {
+      toast.error(error.message, { dismissible: true, duration: 10_000 })
+      trackFunnelError('org_creation', classifyApiError('org_creation', error), 'toast')
+    },
   })
 
   const paymentIntentConfirmed = async (paymentIntentConfirmation: PaymentIntentResult) => {
@@ -260,6 +273,11 @@ export const NewOrgForm = ({
         size: form.getValues('size'),
       })
     } else {
+      trackFunnelError(
+        'org_creation',
+        classifyStripeError(paymentIntentConfirmation.error),
+        'toast'
+      )
       // If the payment intent is not successful, we reset the payment method and show an error
       toast.error(`Could not confirm payment. Please try again or use a different card.`, {
         duration: 10_000,
@@ -354,7 +372,12 @@ export const NewOrgForm = ({
 
   return (
     <Form {...form}>
-      <form onSubmit={form.handleSubmit(onSubmit)} id={FORM_ID}>
+      <form
+        onSubmit={form.handleSubmit(onSubmit, (errors) =>
+          trackFunnelError('org_creation', classifyValidationError('org_creation', errors), 'form')
+        )}
+        id={FORM_ID}
+      >
         <Panel
           title={
             <div key="panel-title">
@@ -547,6 +570,11 @@ export const NewOrgForm = ({
               onLoadingChange={(loading) => setPaymentConfirmationLoading(loading)}
               onError={(err) => {
                 toast.error(err.message, { duration: 10_000 })
+                trackFunnelError(
+                  'org_creation',
+                  { errorCategory: 'payment', errorReason: 'payment_error' },
+                  'toast'
+                )
                 setNewOrgLoading(false)
                 resetPaymentMethod()
               }}
diff --git a/apps/studio/components/interfaces/SignIn/SignUpForm.tsx b/apps/studio/components/interfaces/SignIn/SignUpForm.tsx
index f1bcacd97aa..e3c6c3f2490 100644
--- a/apps/studio/components/interfaces/SignIn/SignUpForm.tsx
+++ b/apps/studio/components/interfaces/SignIn/SignUpForm.tsx
@@ -25,6 +25,8 @@ import PasswordConditionsHelper from './PasswordConditionsHelper'
 import { useSignUpMutation } from '@/data/misc/signup-mutation'
 import { BASE_PATH } from '@/lib/constants'
 import { buildPathWithParams } from '@/lib/gotrue'
+import { classifyApiError, classifyValidationError } from '@/lib/telemetry/funnel-errors'
+import { useTrackFunnelError } from '@/lib/telemetry/use-track-funnel-error'
 
 const schema = z.object({
   email: z.string().min(1, 'Email is required').email('Must be a valid email'),
@@ -67,6 +69,8 @@ export const SignUpForm = () => {
     token: parseAsString.withDefault(''),
   })
 
+  const trackFunnelError = useTrackFunnelError()
+
   const { mutate: signup, isPending: isSigningUp } = useSignUpMutation({
     onSuccess: () => {
       toast.success(`Signed up successfully!`)
@@ -76,6 +80,7 @@ export const SignUpForm = () => {
       setCaptchaToken(null)
       captchaRef.current?.resetCaptcha()
       toast.error(`Failed to sign up: ${error.message}`)
+      trackFunnelError('signup', classifyApiError('signup', error), 'toast')
     },
   })
 
@@ -144,7 +149,13 @@ export const SignUpForm = () => {
         )}
       >
         <Form {...form}>
-          <form id={formId} className="flex flex-col gap-4" onSubmit={form.handleSubmit(onSubmit)}>
+          <form
+            id={formId}
+            className="flex flex-col gap-4"
+            onSubmit={form.handleSubmit(onSubmit, (errors) =>
+              trackFunnelError('signup', classifyValidationError('signup', errors), 'form')
+            )}
+          >
             <FormField
               key="email"
               name="email"
diff --git a/apps/studio/lib/telemetry/funnel-errors.test.ts b/apps/studio/lib/telemetry/funnel-errors.test.ts
new file mode 100644
index 00000000000..6abe0049b6d
--- /dev/null
+++ b/apps/studio/lib/telemetry/funnel-errors.test.ts
@@ -0,0 +1,114 @@
+import type { FieldErrors } from 'react-hook-form'
+import { describe, expect, it } from 'vitest'
+
+import { classifyApiError, classifyStripeError, classifyValidationError } from './funnel-errors'
+
+describe('classifyApiError', () => {
+  it('classifies connection timeout as network', () => {
+    expect(classifyApiError('signup', { errorType: 'connection-timeout' })).toEqual({
+      errorCategory: 'network',
+      errorReason: 'connection_timeout',
+    })
+  })
+
+  it('classifies a missing status code as network_error', () => {
+    expect(classifyApiError('project_creation', { message: 'Failed to fetch' })).toEqual({
+      errorCategory: 'network',
+      errorReason: 'network_error',
+    })
+  })
+
+  it('classifies 429 as rate_limited regardless of message', () => {
+    expect(classifyApiError('signup', { code: 429, message: 'whatever' })).toEqual({
+      errorCategory: 'api',
+      errorReason: 'rate_limited',
+      errorCode: 429,
+    })
+  })
+
+  it('classifies 5xx as server_error', () => {
+    expect(classifyApiError('org_creation', { code: 500, message: 'boom' })).toEqual({
+      errorCategory: 'api',
+      errorReason: 'server_error',
+      errorCode: 500,
+    })
+  })
+
+  it('matches a known 4xx signup message to a reason slug', () => {
+    expect(classifyApiError('signup', { code: 400, message: 'User already registered' })).toEqual({
+      errorCategory: 'api',
+      errorReason: 'email_already_registered',
+      errorCode: 400,
+    })
+  })
+
+  it('matches a known 4xx project message to a reason slug', () => {
+    expect(
+      classifyApiError('project_creation', {
+        code: 403,
+        message: 'Your organization can only have 2 projects',
+      })
+    ).toEqual({ errorCategory: 'api', errorReason: 'project_limit_reached', errorCode: 403 })
+  })
+
+  it('falls back to other for an unmapped 4xx message', () => {
+    expect(classifyApiError('signup', { code: 400, message: 'totally novel error' })).toEqual({
+      errorCategory: 'api',
+      errorReason: 'other',
+      errorCode: 400,
+    })
+  })
+})
+
+describe('classifyValidationError', () => {
+  it('maps a signup password error to password_invalid', () => {
+    expect(
+      classifyValidationError('signup', { password: { type: 'too_small' } } as FieldErrors)
+    ).toEqual({
+      errorCategory: 'validation',
+      errorReason: 'password_invalid',
+    })
+  })
+
+  it('respects field priority (email before password)', () => {
+    expect(
+      classifyValidationError('signup', {
+        email: { type: 'invalid' },
+        password: { type: 'too_small' },
+      } as FieldErrors)
+    ).toEqual({ errorCategory: 'validation', errorReason: 'email_invalid' })
+  })
+
+  it('maps an org name error to org_name_missing', () => {
+    expect(
+      classifyValidationError('org_creation', { name: { type: 'too_small' } } as FieldErrors)
+    ).toEqual({
+      errorCategory: 'validation',
+      errorReason: 'org_name_missing',
+    })
+  })
+
+  it('falls back to other for an unmapped field', () => {
+    expect(
+      classifyValidationError('project_creation', { somethingNew: { type: 'x' } } as FieldErrors)
+    ).toEqual({ errorCategory: 'validation', errorReason: 'other' })
+  })
+})
+
+describe('classifyStripeError', () => {
+  it('maps a decline_code to a card reason slug', () => {
+    expect(
+      classifyStripeError({ code: 'card_declined', decline_code: 'insufficient_funds' })
+    ).toEqual({
+      errorCategory: 'payment',
+      errorReason: 'card_insufficient_funds',
+    })
+  })
+
+  it('falls back to payment_failed for an unknown code', () => {
+    expect(classifyStripeError({ code: 'mystery' })).toEqual({
+      errorCategory: 'payment',
+      errorReason: 'payment_failed',
+    })
+  })
+})
diff --git a/apps/studio/lib/telemetry/funnel-errors.ts b/apps/studio/lib/telemetry/funnel-errors.ts
new file mode 100644
index 00000000000..579d0cc6bea
--- /dev/null
+++ b/apps/studio/lib/telemetry/funnel-errors.ts
@@ -0,0 +1,142 @@
+import type { FieldErrors } from 'react-hook-form'
+
+export type FunnelOrigin = 'signup' | 'project_creation' | 'org_creation'
+export type ErrorCategory = 'validation' | 'api' | 'network' | 'payment' | 'unknown'
+
+export interface FunnelErrorClassification {
+  errorCategory: ErrorCategory
+  errorReason: FunnelErrorReason
+  errorCode?: number
+}
+
+const RATE_LIMIT_STATUS = 429
+
+const API_REASON_PATTERNS = {
+  signup: [
+    [/already registered|already been registered|already exists/i, 'email_already_registered'],
+    [/rate limit|too many requests|after \d+ second/i, 'rate_limited'],
+    [/captcha/i, 'captcha_failed'],
+    [/password/i, 'password_rejected'],
+    [/valid email|invalid email|email address/i, 'email_invalid'],
+  ],
+  project_creation: [
+    [/already exists/i, 'project_name_taken'],
+    [/free plan|free tier/i, 'free_tier_limit'],
+    [/limit|maximum number|can only have/i, 'project_limit_reached'],
+    [/payment|invoice|overdue|past due|billing/i, 'billing_issue'],
+    [/region/i, 'region_unavailable'],
+    [/db_pass|password/i, 'db_password_rejected'],
+  ],
+  org_creation: [
+    [/already exists|name.*taken/i, 'org_name_taken'],
+    [/payment|card|invoice|billing/i, 'billing_issue'],
+    [/limit/i, 'org_limit_reached'],
+  ],
+} as const satisfies Record<FunnelOrigin, ReadonlyArray<readonly [RegExp, string]>>
+
+const VALIDATION_FIELD_REASONS = {
+  signup: {
+    email: 'email_invalid',
+    password: 'password_invalid',
+  },
+  project_creation: {
+    organization: 'organization_missing',
+    projectName: 'project_name_invalid',
+    dbPass: 'db_password_weak',
+    dbPassStrength: 'db_password_weak',
+    dbRegion: 'region_missing',
+    cloudProvider: 'cloud_provider_invalid',
+    postgresVersion: 'postgres_version_missing',
+    highAvailability: 'incompatible_options',
+    useOrioleDb: 'incompatible_options',
+  },
+  org_creation: {
+    name: 'org_name_missing',
+    kind: 'org_kind_invalid',
+    size: 'org_size_invalid',
+  },
+} as const satisfies Record<FunnelOrigin, Readonly<Record<string, string>>>
+
+const STRIPE_DECLINE_REASONS = {
+  insufficient_funds: 'card_insufficient_funds',
+  card_declined: 'card_declined',
+  expired_card: 'card_expired',
+  incorrect_cvc: 'card_incorrect_cvc',
+  incorrect_number: 'card_incorrect_number',
+  processing_error: 'card_processing_error',
+} as const satisfies Record<string, string>
+
+const GENERIC_REASONS = [
+  'rate_limited',
+  'server_error',
+  'connection_timeout',
+  'network_error',
+  'payment_failed',
+  'payment_error',
+  'oriole_unavailable',
+  'other',
+] as const
+
+type ValuesOf<T> = T extends Readonly<Record<string, infer V extends string>> ? V : never
+
+export type FunnelErrorReason =
+  | (typeof API_REASON_PATTERNS)[FunnelOrigin][number][1]
+  | ValuesOf<(typeof VALIDATION_FIELD_REASONS)[FunnelOrigin]>
+  | ValuesOf<typeof STRIPE_DECLINE_REASONS>
+  | (typeof GENERIC_REASONS)[number]
+
+export function classifyApiError(origin: FunnelOrigin, error: unknown): FunnelErrorClassification {
+  const err = error as { code?: unknown; errorType?: unknown; message?: unknown }
+  const code = typeof err?.code === 'number' ? err.code : undefined
+  const message = typeof err?.message === 'string' ? err.message : ''
+
+  if (err?.errorType === 'connection-timeout') {
+    return { errorCategory: 'network', errorReason: 'connection_timeout' }
+  }
+  if (code === undefined) {
+    return { errorCategory: 'network', errorReason: 'network_error' }
+  }
+  if (code === RATE_LIMIT_STATUS) {
+    return { errorCategory: 'api', errorReason: 'rate_limited', errorCode: code }
+  }
+  if (code >= 500) {
+    return { errorCategory: 'api', errorReason: 'server_error', errorCode: code }
+  }
+  for (const [pattern, reason] of API_REASON_PATTERNS[origin]) {
+    if (pattern.test(message)) {
+      return { errorCategory: 'api', errorReason: reason, errorCode: code }
+    }
+  }
+  return { errorCategory: 'api', errorReason: 'other', errorCode: code }
+}
+
+export function classifyValidationError(
+  origin: FunnelOrigin,
+  errors: FieldErrors
+): FunnelErrorClassification {
+  const fieldErrors = errors as Record<string, unknown>
+  const reasons = VALIDATION_FIELD_REASONS[origin] as Readonly<Record<string, FunnelErrorReason>>
+  for (const field of Object.keys(reasons)) {
+    if (fieldErrors[field]) {
+      return { errorCategory: 'validation', errorReason: reasons[field] }
+    }
+  }
+  return { errorCategory: 'validation', errorReason: 'other' }
+}
+
+export function classifyStripeError(error: unknown): FunnelErrorClassification {
+  const err = error as { code?: unknown; decline_code?: unknown }
+  const key =
+    typeof err?.decline_code === 'string'
+      ? err.decline_code
+      : typeof err?.code === 'string'
+        ? err.code
+        : undefined
+  const reason = key
+    ? (STRIPE_DECLINE_REASONS as Readonly<Record<string, FunnelErrorReason>>)[key]
+    : undefined
+  if (reason) {
+    return { errorCategory: 'payment', errorReason: reason }
+  }
+  return { errorCategory: 'payment', errorReason: 'payment_failed' }
+}
diff --git a/apps/studio/lib/telemetry/use-track-funnel-error.ts b/apps/studio/lib/telemetry/use-track-funnel-error.ts
new file mode 100644
index 00000000000..3aa00091a55
--- /dev/null
+++ b/apps/studio/lib/telemetry/use-track-funnel-error.ts
@@ -0,0 +1,28 @@
+import { useCallback } from 'react'
+
+import type { FunnelErrorClassification, FunnelOrigin } from '@/lib/telemetry/funnel-errors'
+import { useTrack } from '@/lib/telemetry/track'
+
+// Matches the existing dashboard_error_created capture rate; keeps PostHog volume bounded.
+const SAMPLE_RATE = 0.1
+
+export function useTrackFunnelError() {
+  const track = useTrack()
+  return useCallback(
+    (
+      origin: FunnelOrigin,
+      classification: FunnelErrorClassification,
+      source: 'toast' | 'form' = 'toast'
+    ) => {
+      if (Math.random() >= SAMPLE_RATE) return
+      track('dashboard_error_created', {
+        source,
+        origin,
+        errorCategory: classification.errorCategory,
+        errorReason: classification.errorReason,
+        ...(classification.errorCode !== undefined && { errorCode: classification.errorCode }),
+      })
+    },
+    [track]
+  )
+}
diff --git a/apps/studio/pages/new/[slug].tsx b/apps/studio/pages/new/[slug].tsx
index a01856a6536..a1738298df2 100644
--- a/apps/studio/pages/new/[slug].tsx
+++ b/apps/studio/pages/new/[slug].tsx
@@ -71,13 +71,16 @@ import { usePHFlag } from '@/hooks/ui/useFlag'
 import { DOCS_URL, PROJECT_STATUS, PROVIDERS, useDefaultProvider } from '@/lib/constants'
 import { buildStudioPageTitle } from '@/lib/page-title'
 import { useProfile } from '@/lib/profile'
+import { classifyApiError, classifyValidationError } from '@/lib/telemetry/funnel-errors'
 import { useTrack } from '@/lib/telemetry/track'
+import { useTrackFunnelError } from '@/lib/telemetry/use-track-funnel-error'
 import type { NextPageWithLayout } from '@/types'
 
 const sizesWithNoCostConfirmationRequired: DesiredInstanceSize[] = ['micro', 'small']
 
 const Wizard: NextPageWithLayout = () => {
   const track = useTrack()
+  const trackFunnelError = useTrackFunnelError()
   const router = useRouter()
   const { slug, projectName } = useParams()
   const { appTitle } = useCustomContent(['app:title'])
@@ -317,6 +320,10 @@ const Wizard: NextPageWithLayout = () => {
       )
       router.push(`/project/${res.ref}`)
     },
+    onError: (error) => {
+      toast.error(`Failed to create new project: ${error.message}`)
+      trackFunnelError('project_creation', classifyApiError('project_creation', error), 'toast')
+    },
   })
 
   const onSubmitWithComputeCostsConfirmation = async (values: z.infer<typeof FormSchema>) => {
@@ -356,6 +363,11 @@ const Wizard: NextPageWithLayout = () => {
     } = values
 
     if (useOrioleDb && !availableOrioleVersion) {
+      trackFunnelError(
+        'project_creation',
+        { errorCategory: 'validation', errorReason: 'oriole_unavailable' },
+        'toast'
+      )
       return toast.error('No available OrioleDB image found, only Postgres is available')
     }
 
@@ -501,7 +513,15 @@ const Wizard: NextPageWithLayout = () => {
         <meta name="description" content="Supabase Studio" />
       </Head>
       <Form {...form}>
-        <form onSubmit={form.handleSubmit(onSubmitWithComputeCostsConfirmation)}>
+        <form
+          onSubmit={form.handleSubmit(onSubmitWithComputeCostsConfirmation, (errors) =>
+            trackFunnelError(
+              'project_creation',
+              classifyValidationError('project_creation', errors),
+              'form'
+            )
+          )}
+        >
           <Panel
             loading={!isOrganizationsSuccess}
             title={
diff --git a/packages/common/telemetry-constants.ts b/packages/common/telemetry-constants.ts
index 3fee50a2d4a..b72164ac2cb 100644
--- a/packages/common/telemetry-constants.ts
+++ b/packages/common/telemetry-constants.ts
@@ -2842,7 +2842,7 @@ export interface DashboardErrorCreatedEvent {
     /**
      * Source of the error
      */
-    source?: 'admonition' | 'toast' | 'error_display'
+    source?: 'admonition' | 'toast' | 'error_display' | 'form'
     /**
      * Type of error matched (for error_display source)
      */
@@ -2851,6 +2851,22 @@ export interface DashboardErrorCreatedEvent {
      * Whether troubleshooting steps are available (for error_display source)
      */
     hasTroubleshooting?: boolean
+    /**
+     * Funnel the error occurred in (set only for instrumented funnel errors)
+     */
+    origin?: 'signup' | 'project_creation' | 'org_creation'
+    /**
+     * Coarse classification of the funnel error
+     */
+    errorCategory?: 'validation' | 'api' | 'network' | 'payment' | 'unknown'
+    /**
+     * Controlled-vocabulary slug describing the reason (no free text, no PII)
+     */
+    errorReason?: string
+    /**
+     * HTTP status code for api/network errors (absent for validation/payment)
+     */
+    errorCode?: number
   }
   groups: TelemetryGroups
 }