diff --git a/enterprise/litellm_enterprise/proxy/management_endpoints/project_endpoints.py b/enterprise/litellm_enterprise/proxy/management_endpoints/project_endpoints.py
index 154a60f1cd1..213e2996210 100644
--- a/enterprise/litellm_enterprise/proxy/management_endpoints/project_endpoints.py
+++ b/enterprise/litellm_enterprise/proxy/management_endpoints/project_endpoints.py
@@ -678,7 +678,16 @@ async def new_project(
         verbose_proxy_logger.exception(
             "litellm.proxy.management_endpoints.project_endpoints.new_project(): Exception occured - {}".format(str(e))
         )
-        raise handle_exception_on_proxy(e)
+        proxy_exception: Final[ProxyException] = handle_exception_on_proxy(e)
+        if proxy_exception.code == "500":
+            raise ProxyException(
+                message="Internal server error",
+                type="internal_server_error",
+                param=None,
+                code=500,
+                headers=proxy_exception.headers,
+            ) from e
+        raise proxy_exception
 
 
 @router.post(
diff --git a/tests/unit/enterprise/proxy/management_endpoints/test_project_endpoints_prisma.py b/tests/unit/enterprise/proxy/management_endpoints/test_project_endpoints_prisma.py
index 2a37ed2ed1f..5aeba34e073 100644
--- a/tests/unit/enterprise/proxy/management_endpoints/test_project_endpoints_prisma.py
+++ b/tests/unit/enterprise/proxy/management_endpoints/test_project_endpoints_prisma.py
@@ -1241,6 +1241,34 @@ async def test_new_project_flag_on_missing_rpm_tpm_returns_400(monkeypatch):
     assert "rpm/tpm quota" in str(exc_info.value)
 
 
+@pytest.mark.asyncio
+async def test_new_project_does_not_expose_database_errors(monkeypatch):
+    internal_detail = "db-internal-marker"
+    mock_prisma_client = mock.MagicMock()
+    mock_prisma_client.db.litellm_teamtable.find_unique = mock.AsyncMock(side_effect=RuntimeError(internal_detail))
+    monkeypatch.setattr(litellm.proxy.proxy_server, "prisma_client", mock_prisma_client)
+    monkeypatch.setattr(litellm.proxy.proxy_server, "premium_user", True)
+    monkeypatch.setattr(litellm.proxy.proxy_server, "general_settings", {})
+
+    with pytest.raises(ProxyException) as exc_info:
+        await _run_new_project(NewProjectRequest(team_id="test-team"))
+
+    assert exc_info.value.code == "500"
+    assert exc_info.value.message
+    assert internal_detail not in exc_info.value.message
+
+
+@pytest.mark.asyncio
+async def test_new_project_keeps_license_error(monkeypatch):
+    monkeypatch.setattr(litellm.proxy.proxy_server, "premium_user", False)
+
+    with pytest.raises(ProxyException) as exc_info:
+        await _run_new_project(NewProjectRequest(team_id="test-team"))
+
+    assert exc_info.value.code == "403"
+    assert "enterprise feature" in exc_info.value.message
+
+
 def _project_update_mocks(monkeypatch, stored_metadata: dict) -> mock.MagicMock:
     existing_row = mock.MagicMock(
         team_id=None, budget_id=None, object_permission_id=None, metadata=stored_metadata
@@ -2104,7 +2132,9 @@ async def test_new_project_quota_policy_reads_providers_from_router_deployments(
 
 
 @pytest.mark.asyncio
-async def test_new_project_rejects_malformed_quota_setting_instead_of_skipping_it(monkeypatch: pytest.MonkeyPatch):
+async def test_new_project_rejects_malformed_quota_setting_instead_of_skipping_it(
+    monkeypatch: pytest.MonkeyPatch, caplog: pytest.LogCaptureFixture
+):
     _enforced_new_project_mocks(
         monkeypatch,
         team_models=["runway-gen4-turbo"],
@@ -2116,7 +2146,8 @@ async def test_new_project_rejects_malformed_quota_setting_instead_of_skipping_i
         await _run_new_project(NewProjectRequest(team_id="test-team", models=["runway-gen4-turbo"]))
 
     assert exc_info.value.code == "500"
-    assert "general_settings.enforce_project_model_quota is invalid" in str(exc_info.value.message)
+    assert exc_info.value.message == "Internal server error"
+    assert "general_settings.enforce_project_model_quota is invalid" in caplog.text
 
 
 @pytest.mark.asyncio