diff --git a/.changeset/upset-clowns-worry.md b/.changeset/upset-clowns-worry.md
new file mode 100644
index 000000000..69b27ef63
--- /dev/null
+++ b/.changeset/upset-clowns-worry.md
@@ -0,0 +1,5 @@
+---
+'@openchoreo/backstage-plugin-backend': patch
+---
+
+Fix Deploy UI showing Failed for ProjectReleaseBinding during namespace provisioning
diff --git a/plugins/openchoreo-backend/src/services/transformers/release-binding.test.ts b/plugins/openchoreo-backend/src/services/transformers/release-binding.test.ts
index 1433feab5..20dfdaef8 100644
--- a/plugins/openchoreo-backend/src/services/transformers/release-binding.test.ts
+++ b/plugins/openchoreo-backend/src/services/transformers/release-binding.test.ts
@@ -56,6 +56,17 @@ describe('deriveBindingStatus', () => {
     expect(deriveBindingStatus(binding)).toBe('NotReady');
   });
 
+  it('returns NotReady for NamespaceProgressing reason', () => {
+    const binding = makeBinding([
+      {
+        type: 'Ready',
+        status: 'False',
+        reason: 'NamespaceProgressing',
+        message: 'Namespace is still being provisioned',
+      },
+    ]);
+    expect(deriveBindingStatus(binding)).toBe('NotReady');
+  });
   it('returns NotReady for JobRunning reason', () => {
     const binding = makeBinding([
       { type: 'Ready', status: 'False', reason: 'JobRunning' },
diff --git a/plugins/openchoreo-backend/src/services/transformers/release-binding.ts b/plugins/openchoreo-backend/src/services/transformers/release-binding.ts
index 6f28c6b02..bdc8b5d5f 100644
--- a/plugins/openchoreo-backend/src/services/transformers/release-binding.ts
+++ b/plugins/openchoreo-backend/src/services/transformers/release-binding.ts
@@ -19,6 +19,9 @@ const PROGRESSING_REASONS = [
   // plane seeds it with the project's latest release once one exists, so a
   // just-created binding sits here briefly. Pending, not an error.
   'ProjectReleaseNotSet',
+  // ProjectReleaseBinding's DataPlane Namespace is still being created or has
+  // not yet been observed as ready. Pending, not an error.
+  'NamespaceProgressing',
 ] as const;
 
 /** Reasons that represent an intentional non-deployed state, not an error. */