diff --git a/packages/cli/src/build/progress.rs b/packages/cli/src/build/progress.rs
index ed2286709..d8c34e64a 100644
--- a/packages/cli/src/build/progress.rs
+++ b/packages/cli/src/build/progress.rs
@@ -41,6 +41,10 @@ impl BuildRequest {
             .unbounded_send(BuildUpdate::CompilerMessage { message });
     }
 
+    pub(crate) fn status_build_error(&self, line: String) {
+        tracing::error!(dx_src = ?TraceSrc::Cargo, "{line}");
+    }
+
     pub(crate) fn status_build_message(&self, line: String) {
         tracing::trace!(dx_src = ?TraceSrc::Cargo, "{line}");
     }
diff --git a/packages/cli/src/build/request.rs b/packages/cli/src/build/request.rs
index f0b4e64b7..731bc85eb 100644
--- a/packages/cli/src/build/request.rs
+++ b/packages/cli/src/build/request.rs
@@ -163,6 +163,7 @@ impl BuildRequest {
         let mut stdout = stdout.lines();
         let mut stderr = stderr.lines();
         let mut units_compiled = 0;
+        let mut emitting_error = false;
 
         loop {
             use cargo_metadata::Message;
@@ -173,15 +174,28 @@ impl BuildRequest {
                 else => break,
             };
 
-            let mut deserializer = serde_json::Deserializer::from_str(line.trim());
-            deserializer.disable_recursion_limit();
-
-            let message =
-                Message::deserialize(&mut deserializer).unwrap_or(Message::TextLine(line));
+            let message = Message::parse_stream(std::io::Cursor::new(line))
+                .next()
+                .unwrap()
+                .unwrap();
 
             match message {
                 Message::BuildScriptExecuted(_) => units_compiled += 1,
-                Message::TextLine(line) => self.status_build_message(line),
+                Message::TextLine(line) => {
+                    // For whatever reason, if there's an error while building, we still receive the TextLine
+                    // instead of an "error" message. However, the following messages *also* tend to
+                    // be the error message, and don't start with "error:". So we'll check if we've already
+                    // emitted an error message and if so, we'll emit all following messages as errors too.
+                    if line.trim_start().starts_with("error:") {
+                        emitting_error = true;
+                    }
+
+                    if emitting_error {
+                        self.status_build_error(line);
+                    } else {
+                        self.status_build_message(line)
+                    }
+                }
                 Message::CompilerMessage(msg) => self.status_build_diagnostic(msg),
                 Message::CompilerArtifact(artifact) => {
                     units_compiled += 1;
diff --git a/packages/cli/src/serve/output.rs b/packages/cli/src/serve/output.rs
index 95bb879a9..3c5e596fe 100644
--- a/packages/cli/src/serve/output.rs
+++ b/packages/cli/src/serve/output.rs
@@ -265,12 +265,7 @@ impl Output {
     pub fn push_cargo_log(&mut self, message: cargo_metadata::CompilerMessage) {
         use cargo_metadata::diagnostic::DiagnosticLevel;
 
-        if self.trace
-            || matches!(
-                message.message.level,
-                DiagnosticLevel::Error | DiagnosticLevel::FailureNote
-            )
-        {
+        if self.trace || !matches!(message.message.level, DiagnosticLevel::Note) {
             self.push_log(TraceMsg::cargo(message));
         }
     }