diff --git a/src/documents/tests/test_api_status.py b/src/documents/tests/test_api_status.py
index 6f200e54f..a8a21a28c 100644
--- a/src/documents/tests/test_api_status.py
+++ b/src/documents/tests/test_api_status.py
@@ -539,3 +539,28 @@ class TestSystemStatus(APITestCase):
         self.assertEqual(response.data["tasks"]["summary"]["success_count"], 1)
         self.assertEqual(response.data["tasks"]["summary"]["failure_count"], 1)
         self.assertEqual(response.data["tasks"]["summary"]["pending_count"], 1)
+
+    def test_system_status_reports_database_error(self) -> None:
+        """
+        GIVEN:
+            - Reading the migration state fails
+        WHEN:
+            - The system status is requested
+        THEN:
+            - The response reports the database error rather than a server error
+        """
+        self.client.force_login(self.user)
+        with mock.patch(
+            "documents.views.MigrationLoader",
+            side_effect=Exception("database is down"),
+        ):
+            response = self.client.get(self.ENDPOINT)
+
+        self.assertEqual(response.status_code, status.HTTP_200_OK)
+        database = response.data["database"]
+        self.assertEqual(database["status"], "ERROR")
+        self.assertIsNotNone(database["error"])
+        self.assertEqual(
+            database["migration_status"],
+            {"latest_migration": None, "unapplied_migrations": []},
+        )
diff --git a/src/documents/views.py b/src/documents/views.py
index 5e17c67cb..5508fb634 100644
--- a/src/documents/views.py
+++ b/src/documents/views.py
@@ -5267,7 +5267,9 @@ class CustomFieldViewSet(PermissionsAwareDocumentCountMixin, ModelViewSet[Custom
                             "migration_status": inline_serializer(
                                 name="MigrationStatus",
                                 fields={
-                                    "latest_migration": serializers.CharField(),
+                                    "latest_migration": serializers.CharField(
+                                        allow_null=True,
+                                    ),
                                     "unapplied_migrations": serializers.ListSerializer(
                                         child=serializers.CharField(),
                                     ),
@@ -5342,6 +5344,8 @@ class SystemStatusView(PassUserMixin):
         db_conn = connections["default"]
         db_url = str(db_conn.settings_dict["NAME"])
         db_error = None
+        all_migrations: list[str] = []
+        applied_migrations: list[str] = []
 
         try:
             db_conn.ensure_connection()
@@ -5352,7 +5356,7 @@ class SystemStatusView(PassUserMixin):
                 f"{m.app}.{m.name}"
                 for m in MigrationRecorder.Migration.objects.all().order_by("id")
             ]
-        except Exception as e:  # pragma: no cover
+        except Exception as e:
             applied_migrations = []
             db_status = "ERROR"
             logger.exception(
@@ -5548,7 +5552,9 @@ class SystemStatusView(PassUserMixin):
                     "status": db_status,
                     "error": db_error,
                     "migration_status": {
-                        "latest_migration": applied_migrations[-1],
+                        "latest_migration": (
+                            applied_migrations[-1] if applied_migrations else None
+                        ),
                         "unapplied_migrations": [
                             m for m in all_migrations if m not in applied_migrations
                         ],