diff --git a/cli/azd/cmd/env.go b/cli/azd/cmd/env.go
index d4bd9ff2612..96b50f6f51d 100644
--- a/cli/azd/cmd/env.go
+++ b/cli/azd/cmd/env.go
@@ -821,6 +821,10 @@ func (e *envListAction) Run(ctx context.Context) (*actions.ActionResult, error)
 				Heading:       "DEFAULT",
 				ValueTemplate: "{{.IsDefault}}",
 			},
+			{
+				Heading:       "STATUS",
+				ValueTemplate: "{{if .IsValid}}✓{{else}}⚠ INVALID NAME{{end}}",
+			},
 			{
 				Heading:       "LOCAL",
 				ValueTemplate: "{{.HasLocal}}",
@@ -834,11 +838,31 @@ func (e *envListAction) Run(ctx context.Context) (*actions.ActionResult, error)
 		err = e.formatter.Format(envs, e.writer, output.TableFormatterOptions{
 			Columns: columns,
 		})
+		if err != nil {
+			return nil, err
+		}
+
+		// Count invalid environments and display warning if any exist
+		invalidCount := 0
+		for _, env := range envs {
+			if !env.IsValid {
+				invalidCount++
+			}
+		}
+
+		if invalidCount > 0 {
+			warning := fmt.Sprintf(
+				"\n⚠ Warning: %d environment(s) have invalid names and may cause issues with azd commands. "+
+					"Environment names must follow the same naming rules enforced when creating or renaming environments.\n",
+				invalidCount,
+			)
+			fmt.Fprint(e.writer, warning)
+		}
 	} else {
 		err = e.formatter.Format(envs, e.writer, nil)
-	}
-	if err != nil {
-		return nil, err
+		if err != nil {
+			return nil, err
+		}
 	}
 
 	return nil, nil
diff --git a/cli/azd/pkg/contracts/env_list.go b/cli/azd/pkg/contracts/env_list.go
index 0b597ca185c..cc51b014a69 100644
--- a/cli/azd/pkg/contracts/env_list.go
+++ b/cli/azd/pkg/contracts/env_list.go
@@ -8,4 +8,5 @@ type EnvListEnvironment struct {
 	IsDefault  bool   `json:"IsDefault"`
 	DotEnvPath string `json:"DotEnvPath"`
 	ConfigPath string `json:"ConfigPath"`
+	IsValid    bool   `json:"IsValid"`
 }
diff --git a/cli/azd/pkg/environment/local_file_data_store.go b/cli/azd/pkg/environment/local_file_data_store.go
index dab3339b56e..ee5d1bde121 100644
--- a/cli/azd/pkg/environment/local_file_data_store.go
+++ b/cli/azd/pkg/environment/local_file_data_store.go
@@ -70,6 +70,7 @@ func (fs *LocalFileDataStore) List(ctx context.Context) ([]*contracts.EnvListEnv
 				IsDefault:  ent.Name() == defaultEnv,
 				DotEnvPath: filepath.Join(fs.azdContext.EnvironmentRoot(ent.Name()), DotEnvFileName),
 				ConfigPath: filepath.Join(fs.azdContext.EnvironmentRoot(ent.Name()), ConfigFileName),
+				IsValid:    IsValidEnvironmentName(ent.Name()),
 			}
 			envs = append(envs, ev)
 		}
diff --git a/cli/azd/pkg/environment/local_file_data_store_test.go b/cli/azd/pkg/environment/local_file_data_store_test.go
index 39754f7b17a..59b9ace29d2 100644
--- a/cli/azd/pkg/environment/local_file_data_store_test.go
+++ b/cli/azd/pkg/environment/local_file_data_store_test.go
@@ -5,10 +5,12 @@ package environment
 
 import (
 	"context"
+	"os"
 	"path/filepath"
 	"testing"
 
 	"github.com/azure/azure-dev/cli/azd/pkg/config"
+	"github.com/azure/azure-dev/cli/azd/pkg/contracts"
 	"github.com/azure/azure-dev/cli/azd/pkg/environment/azdcontext"
 	"github.com/azure/azure-dev/cli/azd/test/mocks"
 	"github.com/stretchr/testify/require"
@@ -40,6 +42,46 @@ func Test_LocalFileDataStore_List(t *testing.T) {
 		require.NoError(t, err)
 		require.NotNil(t, envList)
 	})
+
+	t.Run("ValidatesEnvironmentNames", func(t *testing.T) {
+		// Create a fresh temporary directory for this test to avoid interference
+		tempDir := t.TempDir()
+		freshAzdContext := azdcontext.NewAzdContextWithDirectory(tempDir)
+		freshDataStore := NewLocalFileDataStore(freshAzdContext, fileConfigManager)
+
+		// Create an environment with a valid name
+		validEnv := New("valid-env")
+		err := freshDataStore.Save(*mockContext.Context, validEnv, nil)
+		require.NoError(t, err)
+
+		// Manually create a directory with an invalid name
+		invalidEnvDir := filepath.Join(freshAzdContext.EnvironmentDirectory(), "#invalid$name")
+		err = os.MkdirAll(invalidEnvDir, 0755)
+		require.NoError(t, err)
+
+		// List environments
+		envList, err := freshDataStore.List(*mockContext.Context)
+		require.NoError(t, err)
+		require.NotNil(t, envList)
+		require.Equal(t, 2, len(envList))
+
+		// Check that valid environment has IsValid=true
+		var validEnvResult *contracts.EnvListEnvironment
+		var invalidEnvResult *contracts.EnvListEnvironment
+		for _, env := range envList {
+			if env.Name == "valid-env" {
+				validEnvResult = env
+			} else if env.Name == "#invalid$name" {
+				invalidEnvResult = env
+			}
+		}
+
+		require.NotNil(t, validEnvResult, "valid-env should be in the list")
+		require.True(t, validEnvResult.IsValid, "valid-env should be marked as valid")
+
+		require.NotNil(t, invalidEnvResult, "#invalid$name should be in the list")
+		require.False(t, invalidEnvResult.IsValid, "#invalid$name should be marked as invalid")
+	})
 }
 
 func Test_LocalFileDataStore_SaveAndGet(t *testing.T) {
diff --git a/cli/azd/pkg/environment/manager.go b/cli/azd/pkg/environment/manager.go
index 6a38e1c58ad..6dddc5ba56a 100644
--- a/cli/azd/pkg/environment/manager.go
+++ b/cli/azd/pkg/environment/manager.go
@@ -31,6 +31,8 @@ type Description struct {
 	HasRemote bool
 	// Specifies when the environment is the default environment
 	IsDefault bool
+	// Specifies whether the environment name is valid
+	IsValid bool
 }
 
 // Spec is the specification for creating a new environment
@@ -357,6 +359,7 @@ func (m *manager) List(ctx context.Context) ([]*Description, error) {
 			Name:       env.Name,
 			HasLocal:   true,
 			DotEnvPath: env.DotEnvPath,
+			IsValid:    env.IsValid,
 		}
 	}
 
@@ -372,9 +375,12 @@ func (m *manager) List(ctx context.Context) ([]*Description, error) {
 				existing = &Description{
 					Name:      env.Name,
 					HasRemote: true,
+					IsValid:   env.IsValid,
 				}
 			} else {
 				existing.HasRemote = true
+				// For environments that exist both locally and remotely,
+				// use the local validity check (already set above)
 			}
 			envMap[env.Name] = existing
 		}
@@ -400,6 +406,11 @@ func (m *manager) Get(ctx context.Context, name string) (*Environment, error) {
 		return nil, ErrNameNotSpecified
 	}
 
+	// Validate environment name
+	if !IsValidEnvironmentName(name) {
+		return nil, fmt.Errorf(invalidEnvironmentNameMsg(name))
+	}
+
 	// Check cache first
 	cached, err := m.getFromCache(ctx, name)
 	if err != nil {
diff --git a/cli/azd/pkg/environment/manager_test.go b/cli/azd/pkg/environment/manager_test.go
index 1d965545812..d9ac1fb6335 100644
--- a/cli/azd/pkg/environment/manager_test.go
+++ b/cli/azd/pkg/environment/manager_test.go
@@ -281,6 +281,31 @@ func Test_EnvManager_Get(t *testing.T) {
 
 		localDataStore.AssertCalled(t, "Save", *mockContext.Context, foundEnv, mock.Anything)
 	})
+
+	t.Run("InvalidEnvironmentName", func(t *testing.T) {
+		localDataStore := &MockDataStore{}
+
+		manager := newManagerForTest(azdContext, mockContext.Console, localDataStore, nil)
+
+		// Test various invalid names
+		invalidNames := []string{
+			"#invalid",
+			"$bad%name",
+			"no spaces",
+			"no*asterisk",
+		}
+
+		for _, invalidName := range invalidNames {
+			env, err := manager.Get(*mockContext.Context, invalidName)
+			require.Error(t, err, "Should error for invalid name: %s", invalidName)
+			require.Nil(t, env)
+			require.Contains(t, err.Error(), "invalid")
+			require.Contains(t, err.Error(), "alphanumeric")
+		}
+
+		// localDataStore.Get should never be called for invalid names
+		localDataStore.AssertNotCalled(t, "Get")
+	})
 }
 
 func Test_EnvManager_Save(t *testing.T) {