diff --git a/sdk/identity/azure-identity/CHANGELOG.md b/sdk/identity/azure-identity/CHANGELOG.md
index 579bec779640..dd4fb37f7fe3 100644
--- a/sdk/identity/azure-identity/CHANGELOG.md
+++ b/sdk/identity/azure-identity/CHANGELOG.md
@@ -14,6 +14,7 @@
 ### Other Changes
 
 - Update typing of async credentials to match the `AsyncTokenCredential` protocol.
+- If within `DefaultAzureCredential`, `EnvironmentCredential` will now use log level INFO instead of WARNING to inform users of an incomplete environment configuration.  ([#31814](https://github.com/Azure/azure-sdk-for-python/pull/31814))
 
 ## 1.14.0 (2023-08-08)
 
diff --git a/sdk/identity/azure-identity/azure/identity/_credentials/default.py b/sdk/identity/azure-identity/azure/identity/_credentials/default.py
index b58ee999ef59..115509d91b58 100644
--- a/sdk/identity/azure-identity/azure/identity/_credentials/default.py
+++ b/sdk/identity/azure-identity/azure/identity/_credentials/default.py
@@ -146,7 +146,7 @@ def __init__(self, **kwargs: Any) -> None:  # pylint: disable=too-many-statement
 
         credentials: List["TokenCredential"] = []
         if not exclude_environment_credential:
-            credentials.append(EnvironmentCredential(authority=authority, **kwargs))
+            credentials.append(EnvironmentCredential(authority=authority, _within_dac=True, **kwargs))
         if not exclude_workload_identity_credential:
             if all(os.environ.get(var) for var in EnvironmentVariables.WORKLOAD_IDENTITY_VARS):
                 client_id = workload_identity_client_id
diff --git a/sdk/identity/azure-identity/azure/identity/_credentials/environment.py b/sdk/identity/azure-identity/azure/identity/_credentials/environment.py
index fb7e6b88083a..287bd9a283b0 100644
--- a/sdk/identity/azure-identity/azure/identity/_credentials/environment.py
+++ b/sdk/identity/azure-identity/azure/identity/_credentials/environment.py
@@ -100,8 +100,10 @@ def __init__(self, **kwargs: Any) -> None:
             )
             set_variables = [v for v in expected_variables if v in os.environ]
             if set_variables:
-                _LOGGER.warning(
-                    "Incomplete environment configuration. These variables are set: %s", ", ".join(set_variables)
+                _LOGGER.log(
+                    logging.INFO if kwargs.get("_within_dac") else logging.WARNING,
+                    "Incomplete environment configuration for EnvironmentCredential. These variables are set: %s",
+                    ", ".join(set_variables),
                 )
             else:
                 _LOGGER.info("No environment configuration found.")
diff --git a/sdk/identity/azure-identity/azure/identity/aio/_credentials/default.py b/sdk/identity/azure-identity/azure/identity/aio/_credentials/default.py
index a78887c2db2c..dc9943d1ade3 100644
--- a/sdk/identity/azure-identity/azure/identity/aio/_credentials/default.py
+++ b/sdk/identity/azure-identity/azure/identity/aio/_credentials/default.py
@@ -136,7 +136,7 @@ def __init__(self, **kwargs: Any) -> None:
 
         credentials = []  # type: List[AsyncTokenCredential]
         if not exclude_environment_credential:
-            credentials.append(EnvironmentCredential(authority=authority, **kwargs))
+            credentials.append(EnvironmentCredential(authority=authority, _within_dac=True, **kwargs))
         if not exclude_workload_identity_credential:
             if all(os.environ.get(var) for var in EnvironmentVariables.WORKLOAD_IDENTITY_VARS):
                 client_id = workload_identity_client_id
diff --git a/sdk/identity/azure-identity/azure/identity/aio/_credentials/environment.py b/sdk/identity/azure-identity/azure/identity/aio/_credentials/environment.py
index 1451e858f199..f0a9fe94aa93 100644
--- a/sdk/identity/azure-identity/azure/identity/aio/_credentials/environment.py
+++ b/sdk/identity/azure-identity/azure/identity/aio/_credentials/environment.py
@@ -75,8 +75,10 @@ def __init__(self, **kwargs: Any) -> None:
             expected_variables = set(EnvironmentVariables.CERT_VARS + EnvironmentVariables.CLIENT_SECRET_VARS)
             set_variables = [v for v in expected_variables if v in os.environ]
             if set_variables:
-                _LOGGER.warning(
-                    "Incomplete environment configuration. These variables are set: %s", ", ".join(set_variables)
+                _LOGGER.log(
+                    logging.INFO if kwargs.get("_within_dac") else logging.WARNING,
+                    "Incomplete environment configuration for EnvironmentCredential. These variables are set: %s",
+                    ", ".join(set_variables),
                 )
             else:
                 _LOGGER.info("No environment configuration found.")