diff --git a/extensions/resource-deployment/src/services/notebookService.ts b/extensions/resource-deployment/src/services/notebookService.ts
index 614e405bce..e76e51b219 100644
--- a/extensions/resource-deployment/src/services/notebookService.ts
+++ b/extensions/resource-deployment/src/services/notebookService.ts
@@ -79,11 +79,15 @@ export class NotebookService implements INotebookService {
 		const workingDirectory = this.platformService.storagePath();
 		const notebookFullPath = path.join(workingDirectory, fileName);
 		const outputFullPath = path.join(workingDirectory, `output-${fileName}`);
+		const additionalEnvironmentVariables: NodeJS.ProcessEnv = env || {};
+		// Set the azdata eula
+		// Scenarios using the executeNotebook feature already have the EULA acceptted by the user before executing this.
+		additionalEnvironmentVariables['ACCEPT_EULA'] = 'yes';
 		try {
 			await this.platformService.saveTextFile(content, notebookFullPath);
 			await this.platformService.runCommand(`azdata notebook run --path "${notebookFullPath}" --output-path "${workingDirectory}" --timeout -1`,
 				{
-					additionalEnvironmentVariables: env,
+					additionalEnvironmentVariables: additionalEnvironmentVariables,
 					workingDirectory: workingDirectory
 				});
 			return {