diff --git a/cli/internal/cmd/create.go b/cli/internal/cmd/create.go
index 4912bba82..93e46ff5f 100644
--- a/cli/internal/cmd/create.go
+++ b/cli/internal/cmd/create.go
@@ -12,6 +12,7 @@ import (
 	"io/fs"
 
 	"github.com/edgelesssys/constellation/v2/cli/internal/cloudcmd"
+	"github.com/edgelesssys/constellation/v2/cli/internal/terraform"
 	"github.com/edgelesssys/constellation/v2/internal/cloud/cloudprovider"
 	"github.com/edgelesssys/constellation/v2/internal/config"
 	"github.com/edgelesssys/constellation/v2/internal/constants"
@@ -126,7 +127,7 @@ func create(cmd *cobra.Command, creator cloudCreator, fileHandler file.Handler,
 	idFile, err := creator.Create(cmd.Context(), provider, conf, flags.name, instanceType, flags.controllerCount, flags.workerCount)
 	spinner.Stop()
 	if err != nil {
-		return err
+		return translateCreateErrors(cmd, err)
 	}
 
 	if err := fileHandler.WriteJSON(constants.ClusterIDsFileName, idFile, file.OptNone); err != nil {
@@ -209,6 +210,27 @@ func checkDirClean(fileHandler file.Handler) error {
 	return nil
 }
 
+func translateCreateErrors(cmd *cobra.Command, err error) error {
+	switch {
+	case errors.Is(err, terraform.ErrTerraformWorkspaceDifferentFiles):
+		cmd.PrintErrln("\nYour current working directory contains an existing Terraform workspace which does not match the expected state.")
+		cmd.PrintErrln("This can be due to a mix up between providers, versions or an otherwise corrupted workspace.")
+		cmd.PrintErrln("Before creating a new cluster, try \"constellation terminate\".")
+		cmd.PrintErrf("If this does not work, either move or delete the directory %q.\n", constants.TerraformWorkingDir)
+		cmd.PrintErrln("Please only delete the directory if you made sure that all created cloud resources have been terminated.")
+		return err
+	case errors.Is(err, terraform.ErrTerraformWorkspaceExistsWithDifferentVariables):
+		cmd.PrintErrln("\nYour current working directory contains an existing Terraform workspace which was initiated with different input variables.")
+		cmd.PrintErrln("This can be the case if you have tried to create a cluster before with different options which did not complete, or the workspace is corrupted.")
+		cmd.PrintErrln("Before creating a new cluster, try \"constellation terminate\".")
+		cmd.PrintErrf("If this does not work, either move or delete the directory %q.\n", constants.TerraformWorkingDir)
+		cmd.PrintErrln("Please only delete the directory if you made sure that all created cloud resources have been terminated.")
+		return err
+	default:
+		return err
+	}
+}
+
 func must(err error) {
 	if err != nil {
 		panic(err)
diff --git a/cli/internal/terraform/loader.go b/cli/internal/terraform/loader.go
index 1fd86e080..b40aac690 100644
--- a/cli/internal/terraform/loader.go
+++ b/cli/internal/terraform/loader.go
@@ -10,7 +10,6 @@ import (
 	"bytes"
 	"embed"
 	"errors"
-	"fmt"
 	"io/fs"
 	"path"
 	"path/filepath"
@@ -21,6 +20,9 @@ import (
 	"github.com/spf13/afero"
 )
 
+// ErrTerraformWorkspaceDifferentFiles is returned when a re-used existing Terraform workspace has different files than the ones to be extracted (e.g. due to a version mix-up or incomplete writes).
+var ErrTerraformWorkspaceDifferentFiles = errors.New("creating cluster: trying to overwrite an existing Terraform file with a different version")
+
 //go:embed terraform/*
 //go:embed terraform/*/.terraform.lock.hcl
 var terraformFS embed.FS
@@ -53,7 +55,7 @@ func prepareWorkspace(fileHandler file.Handler, provider cloudprovider.Provider,
 			}
 
 			if !bytes.Equal(content, existingFileContent) {
-				return fmt.Errorf("trying to overwrite existing Terraform file with different version")
+				return ErrTerraformWorkspaceDifferentFiles
 			}
 			return nil
 		} else if err != nil {
diff --git a/cli/internal/terraform/terraform.go b/cli/internal/terraform/terraform.go
index 2fe70678f..055a7def7 100644
--- a/cli/internal/terraform/terraform.go
+++ b/cli/internal/terraform/terraform.go
@@ -29,6 +29,9 @@ const (
 	terraformVarsFile = "terraform.tfvars"
 )
 
+// ErrTerraformWorkspaceExistsWithDifferentVariables is returned when existing Terraform files differ from the version the CLI wants to extract.
+var ErrTerraformWorkspaceExistsWithDifferentVariables = errors.New("creating cluster: a Terraform workspace already exists with different variables")
+
 // Client manages interaction with Terraform.
 type Client struct {
 	tf tfInterface
@@ -162,7 +165,7 @@ func (c *Client) writeVars(vars Variables) error {
 			return err
 		}
 		if vars.String() != string(varsContent) {
-			return errors.New("creating cluster: workspace already exists with different variables")
+			return ErrTerraformWorkspaceExistsWithDifferentVariables
 		}
 	} else if err != nil {
 		return err