diff --git a/internal/provider/resource_ko_build.go b/internal/provider/resource_ko_build.go
index 55eb144..12b8022 100644
--- a/internal/provider/resource_ko_build.go
+++ b/internal/provider/resource_ko_build.go
@@ -355,31 +355,32 @@ func resourceKoBuildCreate(ctx context.Context, d *schema.ResourceData, meta int
 	return nil
 }
 
+const zeroRef = "example.com/zero@sha256:0000000000000000000000000000000000000000000000000000000000000000"
+
 func resourceKoBuildRead(ctx context.Context, d *schema.ResourceData, meta interface{}) diag.Diagnostics {
 	po, err := NewProviderOpts(meta)
 	if err != nil {
 		return diag.Errorf("configuring provider: %v", err)
 	}
 
+	var diags diag.Diagnostics
 	_, ref, err := doBuild(ctx, fromData(d, po))
 	if err != nil {
-		// Check for conditions that might indicate that the underlying module has been deleted.
-		// This is not an exhaustive list, but is a best effort check to see if the build failed because a deletion.
-		// See https://www.hashicorp.com/blog/writing-custom-terraform-providers#implementing-read for more details.
-		if errors.Is(err, os.ErrNotExist) {
-			d.SetId("")
-			return nil
-		}
-		return diag.Errorf("[id=%s] read doBuild: %v", d.Id(), err)
+		ref = zeroRef
+		diags = append(diags, diag.Diagnostic{
+			Severity: diag.Warning,
+			Summary:  "Image build failed to read -- create may fail.",
+			Detail:   fmt.Sprintf("failed to read image: %v", err),
+		})
 	}
 
 	_ = d.Set("image_ref", ref)
-	if ref != d.Id() {
+	if ref != d.Id() || ref == zeroRef {
 		d.SetId("") // triggers create on next apply.
 	} else {
 		d.SetId(ref)
 	}
-	return nil
+	return diags
 }
 
 func resourceKoBuildDelete(_ context.Context, _ *schema.ResourceData, _ interface{}) diag.Diagnostics {
diff --git a/internal/provider/resource_ko_build_test.go b/internal/provider/resource_ko_build_test.go
index 281550b..35280e9 100644
--- a/internal/provider/resource_ko_build_test.go
+++ b/internal/provider/resource_ko_build_test.go
@@ -117,11 +117,11 @@ func TestAccResourceKoBuild(t *testing.T) {
 		ProviderFactories: providerFactories,
 		Steps: []resource.TestStep{{
 			Config: `
-			resource "ko_build" "foo" {
-			  importpath = "github.com/ko-build/terraform-provider-ko/cmd/test-cgo"
-			  env     = ["CGO_ENABLED=1"]
-			}
-			`,
+				resource "ko_build" "foo" {
+				  importpath = "github.com/ko-build/terraform-provider-ko/cmd/test-cgo"
+				  env     = ["CGO_ENABLED=1"]
+				}
+				`,
 			Check: resource.ComposeTestCheckFunc(
 				resource.TestMatchResourceAttr("ko_build.foo", "image_ref",
 					regexp.MustCompile("^"+url+"/github.com/ko-build/terraform-provider-ko/cmd/test-cgo@sha256:")),
@@ -172,6 +172,27 @@ func TestAccResourceKoBuild(t *testing.T) {
 			}},
 		})
 	})
+
+	t.Run("build fails during plan", func(t *testing.T) {
+		res := `resource "ko_build" "foo" { importpath = "github.com/ko-build/terraform-provider-ko/cmd/not-found" }`
+
+		resource.Test(t, resource.TestCase{
+			ProviderFactories: providerFactories,
+			Steps: []resource.TestStep{{
+				// A failed build during plan should still show a diff, which will fail at create time.
+				// This enables cases where an importpath changes, where the previous state is now invalid
+				// and the ko build will fail; this should not block the create though, which should
+				// succeed and update the state.
+				PlanOnly:           true,
+				ExpectNonEmptyPlan: true,
+				Config:             res,
+			}, {
+				// The same failed build during create should fail with an error.
+				Config:      res,
+				ExpectError: regexp.MustCompile(".*create doBuild.*no required module provides package.*"),
+			}},
+		})
+	})
 }
 
 func TestAccResourceKoBuild_ImageRepo(t *testing.T) {