Unsupported auth type AccountManagedIdentity when uploading dataset

[TaylorTheDeveloper]

• Package Name: azure-ai-projects
• Package Version: 2.0.1
• Operating System: Windows 11
• Python Version: 3.13.7

Describe the bug

Calling project_client.datasets.upload_file() on an AI Services-backed AI Foundry project (new CognitiveServices/accounts model, not the legacy MachineLearningServices/workspaces model) fails with a 400 BadRequest error:

Unsupported auth type AccountManagedIdentity

The error originates from the asset store backend at:

POST https://eastus2.api.azureml.ms/assetstore/v1.0/temporaryDataReference/createOrGet

The AI Foundry hub is configured with:

• Identity type: UserAssigned managed identity
• systemDatastoresAuthMode: "Identity"

This is not limited to the SDK — the same error also occurs when attempting to upload a dataset through the Azure AI Foundry portal UI, confirming this is a backend/platform-level issue rather than an SDK bug.

To Reproduce

1. Deploy an AI Services-backed AI Foundry hub (Microsoft.MachineLearningServices/workspaces, kind: "Hub") with:
   • UserAssigned managed identity
   • systemDatastoresAuthMode = "Identity"
2. Deploy an AI Foundry project under the hub
3. Download the sample data set from the eval portal
4. Run the following Python script:

from azure.ai.projects import AIProjectClient
from azure.identity import DefaultAzureCredential

project_client = AIProjectClient(
    endpoint="https://<ai-services-name>.services.ai.azure.com/api/projects/<project-name>",
    credential=DefaultAzureCredential(),
)

dataset = project_client.datasets.upload_file(
    name="my_dataset",
    version="1",
    file_path="./sample.jsonl",
)

5. Observe the error:

azure.core.exceptions.HttpResponseError: (ServiceError) Received 400 from a service request
Code: ServiceError
Message: Received 400 from a service request
Target: POST https://eastus2.api.azureml.ms/assetstore/v1.0/temporaryDataReference/createOrGet

(BadRequest) "Unsupported auth type AccountManagedIdentity"

6.. Attempt the same upload via the Azure AI Foundry portal UI → same error.

Expected behavior

datasets.upload_file() should succeed when the hub is configured with systemDatastoresAuthMode = "Identity" and a UserAssigned managed identity. The asset store's temporaryDataReference/createOrGet endpoint should support the AccountManagedIdentity auth type for AI Services-backed projects.

Screenshots
UI Error (same as python sdk error)

Additional context
Add any other context about the problem here.

[github-actions]

Thanks for the feedback! We are routing this to the appropriate team for follow-up. cc @bobogogo1990 @dargilco @glharper @howieleung @kingernupur @nick863 @trangevi @trrwilson.

[kashifkhan]

Thank you for the feedback @TaylorTheDeveloper . Ive routed this over to the right team that can help you further

[dargilco]

Thank you @TaylorTheDeveloper for creating this issue and providing all the details. I'm reaching out to the relevant folks.

[andscho-msft]

Please use ProjectManagedIdentity instead of AccountManagedIdentity