diff --git a/ui/litellm-dashboard/src/components/DefaultUserSettings.test.tsx b/ui/litellm-dashboard/src/components/DefaultUserSettings.test.tsx
index a078d63d951..6fc83d79d98 100644
--- a/ui/litellm-dashboard/src/components/DefaultUserSettings.test.tsx
+++ b/ui/litellm-dashboard/src/components/DefaultUserSettings.test.tsx
@@ -310,6 +310,86 @@ describe("DefaultUserSettings", () => {
     // Should still be in edit mode (Save Changes button visible)
     expect(screen.getByText("Save Changes")).toBeInTheDocument();
   });
+
+  it("should keep modal open when API save fails", async () => {
+    const settingsWithTeams = {
+      ...mockSettings,
+      values: {
+        ...mockSettings.values,
+        teams: [
+          { team_id: "team-alpha", max_budget_in_team: 50, user_role: "user" },
+        ],
+      },
+    };
+    mockGetInternalUserSettings.mockResolvedValue(settingsWithTeams);
+    mockUpdateInternalUserSettings.mockRejectedValue(new Error("Server error"));
+
+    render(<DefaultUserSettings {...defaultProps} />);
+
+    await waitFor(() => {
+      expect(screen.getByText("Edit Settings")).toBeInTheDocument();
+    });
+
+    // Enter edit mode, remove team, click Save → modal opens
+    act(() => {
+      fireEvent.click(screen.getByText("Edit Settings"));
+    });
+    act(() => {
+      fireEvent.click(screen.getAllByText("Remove")[0]);
+    });
+    act(() => {
+      fireEvent.click(screen.getByText("Save Changes"));
+    });
+
+    await waitFor(() => {
+      expect(screen.getByText("Review Changes")).toBeInTheDocument();
+    });
+
+    // Click Confirm — API will reject
+    await act(async () => {
+      fireEvent.click(screen.getByText("Confirm Changes"));
+    });
+
+    // Modal should still be open (not cleared on failure)
+    await waitFor(() => {
+      expect(screen.getByText("Review Changes")).toBeInTheDocument();
+      expect(screen.getByText("Confirm Changes")).toBeInTheDocument();
+    });
+  });
+
+  it("should reflect API response values after successful save", async () => {
+    mockGetInternalUserSettings.mockResolvedValue(mockSettings);
+    // API returns different max_budget than what was sent
+    mockUpdateInternalUserSettings.mockResolvedValue({
+      settings: {
+        ...mockSettings.values,
+        max_budget: 2000,
+      },
+    });
+
+    render(<DefaultUserSettings {...defaultProps} />);
+
+    await waitFor(() => {
+      expect(screen.getByText("Edit Settings")).toBeInTheDocument();
+    });
+
+    act(() => {
+      fireEvent.click(screen.getByText("Edit Settings"));
+    });
+
+    const saveButton = screen.getByText("Save Changes");
+    act(() => {
+      fireEvent.click(saveButton);
+    });
+
+    await waitFor(() => {
+      expect(mockUpdateInternalUserSettings).toHaveBeenCalled();
+    });
+
+    // Should exit edit mode and show the API response value
+    expect(screen.getByText("Edit Settings")).toBeInTheDocument();
+    expect(screen.getByText("2000")).toBeInTheDocument();
+  });
 });
 
 // ---------------------------------------------------------------------------
diff --git a/ui/litellm-dashboard/src/components/DefaultUserSettings.tsx b/ui/litellm-dashboard/src/components/DefaultUserSettings.tsx
index c0dbc3ecc8f..0e07eae174a 100644
--- a/ui/litellm-dashboard/src/components/DefaultUserSettings.tsx
+++ b/ui/litellm-dashboard/src/components/DefaultUserSettings.tsx
@@ -167,18 +167,20 @@ const DefaultUserSettings: React.FC<DefaultUserSettingsProps> = ({
     fetchSSOSettings();
   }, [accessToken]);
 
-  /** Perform the actual API save with the given processed values. */
-  const executeSave = async (processedValues: DefaultUserSettingsValues) => {
-    if (!accessToken) return;
+  /** Perform the actual API save. Returns true on success, false on failure. */
+  const executeSave = async (processedValues: DefaultUserSettingsValues): Promise<boolean> => {
+    if (!accessToken) return false;
 
     setSaving(true);
     try {
       const updatedSettings = await updateInternalUserSettings(accessToken, processedValues);
       setSettings({ ...settings, values: updatedSettings.settings });
       setIsEditing(false);
+      return true;
     } catch (error) {
       console.error("Error updating SSO settings:", error);
       NotificationManager.fromBackend("Failed to update settings: " + error);
+      return false;
     } finally {
       setSaving(false);
     }
@@ -209,13 +211,15 @@ const DefaultUserSettings: React.FC<DefaultUserSettingsProps> = ({
     await executeSave(processedValues);
   };
 
-  /** Called when user confirms changes in the modal. */
+  /** Called when user confirms changes in the modal. Only clears modal on success. */
   const handleConfirmSave = async () => {
     if (!pendingProcessedValues) return;
-    await executeSave(pendingProcessedValues);
-    setShowConfirmModal(false);
-    setPendingChanges([]);
-    setPendingProcessedValues(null);
+    const success = await executeSave(pendingProcessedValues);
+    if (success) {
+      setShowConfirmModal(false);
+      setPendingChanges([]);
+      setPendingProcessedValues(null);
+    }
   };
 
   const handleTextInputChange = (key: keyof DefaultUserSettingsValues, value: DefaultUserSettingsValues[typeof key]) => {