diff --git a/pkg/providers/clients/errors.go b/pkg/providers/clients/errors.go
index bf4635c7..deaf00bc 100644
--- a/pkg/providers/clients/errors.go
+++ b/pkg/providers/clients/errors.go
@@ -8,6 +8,7 @@ import (
 
 var (
 	ErrProviderUnavailable      = errors.New("provider is not available")
+	ErrUnauthorized             = errors.New("API key is wrong or not set")
 	ErrChatStreamNotImplemented = errors.New("streaming chat API is not implemented for provider")
 )
 
diff --git a/pkg/providers/lang.go b/pkg/providers/lang.go
index 9fa78281..93a78698 100644
--- a/pkg/providers/lang.go
+++ b/pkg/providers/lang.go
@@ -110,26 +110,25 @@ func (m *LanguageModel) ChatStream(ctx context.Context, req *schemas.ChatRequest
 		return nil, err
 	}
 
-	streamResultC := make(chan *clients.ChatStreamResult)
-
-	go func() {
-		defer close(streamResultC)
+	startedAt := time.Now()
+	err = stream.Open()
+	chunkLatency := time.Since(startedAt)
 
-		startedAt := time.Now()
-		err = stream.Open()
-		chunkLatency := time.Since(startedAt)
+	// the first chunk latency
+	m.chatStreamLatency.Add(float64(chunkLatency))
 
-		// the first chunk latency
-		m.chatStreamLatency.Add(float64(chunkLatency))
+	if err != nil {
+		// if connection was not even open, we should not send our clients any messages about this failure
 
-		if err != nil {
-			m.healthTracker.TrackErr(err)
+		m.healthTracker.TrackErr(err)
 
-			// if connection was not even open, we should not send our clients any messages about this failure
+		return nil, err
+	}
 
-			return
-		}
+	streamResultC := make(chan *clients.ChatStreamResult)
 
+	go func() {
+		defer close(streamResultC)
 		defer stream.Close()
 
 		for {
diff --git a/pkg/providers/openai/errors.go b/pkg/providers/openai/errors.go
index 49fdc412..94ef5418 100644
--- a/pkg/providers/openai/errors.go
+++ b/pkg/providers/openai/errors.go
@@ -55,6 +55,10 @@ func (m *ErrorMapper) Map(resp *http.Response) error {
 		return clients.NewRateLimitError(&cooldownDelay)
 	}
 
+	if resp.StatusCode == http.StatusUnauthorized {
+		return clients.ErrUnauthorized
+	}
+
 	// Server & client errors result in the same error to keep gateway resilient
 	return clients.ErrProviderUnavailable
 }
diff --git a/pkg/routers/health/tracker.go b/pkg/routers/health/tracker.go
index e6135d54..f49e310b 100644
--- a/pkg/routers/health/tracker.go
+++ b/pkg/routers/health/tracker.go
@@ -8,24 +8,32 @@ import (
 
 // Tracker tracks errors and general health of model provider
 type Tracker struct {
-	errBudget *TokenBucket
-	rateLimit *RateLimitTracker
+	unauthorized bool
+	errBudget    *TokenBucket
+	rateLimit    *RateLimitTracker
 }
 
 func NewTracker(budget *ErrorBudget) *Tracker {
 	return &Tracker{
-		rateLimit: NewRateLimitTracker(),
-		errBudget: NewTokenBucket(budget.TimePerTokenMicro(), budget.Budget()),
+		unauthorized: false,
+		rateLimit:    NewRateLimitTracker(),
+		errBudget:    NewTokenBucket(budget.TimePerTokenMicro(), budget.Budget()),
 	}
 }
 
 func (t *Tracker) Healthy() bool {
-	return !t.rateLimit.Limited() && t.errBudget.HasTokens()
+	return !t.unauthorized && !t.rateLimit.Limited() && t.errBudget.HasTokens()
 }
 
 func (t *Tracker) TrackErr(err error) {
 	var rateLimitErr *clients.RateLimitError
 
+	if errors.Is(err, clients.ErrUnauthorized) {
+		t.unauthorized = true
+
+		return
+	}
+
 	if errors.As(err, &rateLimitErr) {
 		t.rateLimit.SetLimited(rateLimitErr.UntilReset())
 
diff --git a/pkg/routers/router.go b/pkg/routers/router.go
index 78eaa672..81ddb47d 100644
--- a/pkg/routers/router.go
+++ b/pkg/routers/router.go
@@ -152,6 +152,7 @@ func (r *LangRouter) ChatStream(
 
 			langModel := model.(providers.LangModel)
 			modelRespC, err := langModel.ChatStream(ctx, req)
+
 			if err != nil {
 				r.tel.L().Error(
 					"Lang model failed to create streaming chat request",