diff --git a/projects/plugins/jetpack/changelog/update-jetpack-ai-handle-errors-on-title-improvement-tool b/projects/plugins/jetpack/changelog/update-jetpack-ai-handle-errors-on-title-improvement-tool
new file mode 100644
index 0000000000000..fa385b0412fcc
--- /dev/null
+++ b/projects/plugins/jetpack/changelog/update-jetpack-ai-handle-errors-on-title-improvement-tool
@@ -0,0 +1,4 @@
+Significance: patch
+Type: other
+
+Title Optimization: properly handle errors and show the correct UI for each.
diff --git a/projects/plugins/jetpack/extensions/plugins/ai-assistant-plugin/components/title-optimization/index.tsx b/projects/plugins/jetpack/extensions/plugins/ai-assistant-plugin/components/title-optimization/index.tsx
index c272caf73a022..01acfac40d607 100644
--- a/projects/plugins/jetpack/extensions/plugins/ai-assistant-plugin/components/title-optimization/index.tsx
+++ b/projects/plugins/jetpack/extensions/plugins/ai-assistant-plugin/components/title-optimization/index.tsx
@@ -1,15 +1,23 @@
 /**
  * External dependencies
  */
-import { useAiSuggestions } from '@automattic/jetpack-ai-client';
+import {
+	useAiSuggestions,
+	RequestingErrorProps,
+	ERROR_QUOTA_EXCEEDED,
+	ERROR_NETWORK,
+	ERROR_SERVICE_UNAVAILABLE,
+	ERROR_UNCLEAR_PROMPT,
+} from '@automattic/jetpack-ai-client';
 import { useAnalytics } from '@automattic/jetpack-shared-extension-utils';
-import { Button, Spinner, ExternalLink } from '@wordpress/components';
+import { Button, Spinner, ExternalLink, Notice } from '@wordpress/components';
 import { useDispatch } from '@wordpress/data';
 import { useState, useCallback } from '@wordpress/element';
 import { __ } from '@wordpress/i18n';
 /**
  * Internal dependencies
  */
+import QuotaExceededMessage from '../../../../blocks/ai-assistant/components/quota-exceeded-message';
 import { getFeatureAvailability } from '../../../../blocks/ai-assistant/lib/utils/get-feature-availability';
 import useAutoSaveAndRedirect from '../../../../shared/use-autosave-and-redirect';
 import usePostContent from '../../hooks/use-post-content';
@@ -25,6 +33,43 @@ const isKeywordsFeatureAvailable = getFeatureAvailability(
 	'ai-title-optimization-keywords-support'
 );
 
+/**
+ * A generic error message that we can reuse.
+ */
+const genericErrorMessage = __(
+	'The generation of your suggested titles failed. Please try again.',
+	'jetpack'
+);
+
+const ERROR_JSON_PARSE = 'json-parse-error';
+type TitleOptimizationJSONError = {
+	code: typeof ERROR_JSON_PARSE;
+	message: string;
+};
+
+type TitleOptimizationError = RequestingErrorProps | TitleOptimizationJSONError;
+
+const TitleOptimizationErrorMessage = ( { error }: { error: TitleOptimizationError } ) => {
+	if ( error.code === ERROR_QUOTA_EXCEEDED ) {
+		return (
+			<div className="jetpack-ai-title-optimization__error">
+				<QuotaExceededMessage useLightNudge={ true } />
+			</div>
+		);
+	}
+
+	// Use the provided message, if available, otherwise use the generic error message
+	const errorMessage = error.message ? error.message : genericErrorMessage;
+
+	return (
+		<div className="jetpack-ai-title-optimization__error">
+			<Notice status="error" isDismissible={ false }>
+				{ errorMessage }
+			</Notice>
+		</div>
+	);
+};
+
 export default function TitleOptimization( {
 	placement,
 	busy,
@@ -58,7 +103,7 @@ export default function TitleOptimization( {
 	const [ isTitleOptimizationModalVisible, setIsTitleOptimizationModalVisible ] = useState( false );
 	const [ generating, setGenerating ] = useState( false );
 	const [ options, setOptions ] = useState( [] );
-	const [ error, setError ] = useState( false );
+	const [ error, setError ] = useState< TitleOptimizationError | null >( null );
 	const [ optimizationKeywords, setOptimizationKeywords ] = useState( '' );
 	const { editPost } = useDispatch( 'core/editor' );
 	const { autosave } = useAutoSaveAndRedirect();
@@ -80,7 +125,11 @@ export default function TitleOptimization( {
 				setOptions( parsedContent );
 				setSelected( parsedContent?.[ 0 ]?.title );
 			} catch ( e ) {
-				// Do nothing
+				const jsonError: TitleOptimizationJSONError = {
+					code: ERROR_JSON_PARSE,
+					message: genericErrorMessage,
+				};
+				setError( jsonError );
 			}
 		},
 		[ increaseAiAssistantRequestsCount ]
@@ -88,8 +137,8 @@ export default function TitleOptimization( {
 
 	const { request, stopSuggestion } = useAiSuggestions( {
 		onDone: handleDone,
-		onError: () => {
-			setError( true );
+		onError: ( e: RequestingErrorProps ) => {
+			setError( e );
 			setGenerating( false );
 		},
 	} );
@@ -127,7 +176,7 @@ export default function TitleOptimization( {
 	}, [ handleRequest, toggleTitleOptimizationModal ] );
 
 	const handleTryAgain = useCallback( () => {
-		setError( false );
+		setError( null );
 		handleRequest( true ); // retry the generation
 	}, [ handleRequest ] );
 
@@ -160,6 +209,14 @@ export default function TitleOptimization( {
 		stopSuggestion();
 	}, [ stopSuggestion, toggleTitleOptimizationModal ] );
 
+	// When can we retry?
+	const showTryAgainButton =
+		error &&
+		[ ERROR_JSON_PARSE, ERROR_NETWORK, ERROR_SERVICE_UNAVAILABLE, ERROR_UNCLEAR_PROMPT ].includes(
+			error.code
+		);
+	const showReplaceTitleButton = ! error;
+
 	return (
 		<div>
 			<p>{ sidebarDescription }</p>
@@ -190,12 +247,7 @@ export default function TitleOptimization( {
 					) : (
 						<>
 							{ error ? (
-								<div className="jetpack-ai-title-optimization__error">
-									{ __(
-										'The generation of your suggested titles failed. Please try again.',
-										'jetpack'
-									) }
-								</div>
+								<TitleOptimizationErrorMessage error={ error } />
 							) : (
 								<>
 									{ isKeywordsFeatureAvailable && (
@@ -226,11 +278,12 @@ export default function TitleOptimization( {
 								<Button variant="secondary" onClick={ toggleTitleOptimizationModal }>
 									{ __( 'Cancel', 'jetpack' ) }
 								</Button>
-								{ error ? (
+								{ showTryAgainButton && (
 									<Button variant="primary" onClick={ handleTryAgain }>
 										{ __( 'Try again', 'jetpack' ) }
 									</Button>
-								) : (
+								) }
+								{ showReplaceTitleButton && (
 									<Button variant="primary" onClick={ handleAccept }>
 										{ __( 'Replace title', 'jetpack' ) }
 									</Button>