diff --git a/site/src/pages/UsersPage/CreateUserPage/CreateUserPage.tsx b/site/src/pages/UsersPage/CreateUserPage/CreateUserPage.tsx
index 8b341aabdd..da4febd6df 100644
--- a/site/src/pages/UsersPage/CreateUserPage/CreateUserPage.tsx
+++ b/site/src/pages/UsersPage/CreateUserPage/CreateUserPage.tsx
@@ -1,7 +1,6 @@
 import { useActor } from "@xstate/react"
 import React, { useContext } from "react"
 import { useNavigate } from "react-router"
-import { isApiError, mapApiErrorToFieldErrors } from "../../../api/errors"
 import { CreateUserRequest } from "../../../api/typesGenerated"
 import { CreateUserForm } from "../../../components/CreateUserForm/CreateUserForm"
 import { XServiceContext } from "../../../xServices/StateContext"
@@ -13,19 +12,18 @@ export const Language = {
 export const CreateUserPage = () => {
   const xServices = useContext(XServiceContext)
   const [usersState, usersSend] = useActor(xServices.usersXService)
-  const { createUserError } = usersState.context
-  const apiError = isApiError(createUserError)
-  const formErrors = apiError ? mapApiErrorToFieldErrors(createUserError.response.data) : undefined
-  const hasUnknownError = createUserError && !apiError
+  const { createUserError, createUserFormErrors } = usersState.context
   const navigate = useNavigate()
+  // There is no field for organization id in Community Edition, so handle its field error like a generic error
+  const genericError = (createUserError || createUserFormErrors?.organization_id) ? Language.unknownError : undefined
 
   return (
     <CreateUserForm
-      formErrors={formErrors}
+      formErrors={createUserFormErrors}
       onSubmit={(user: CreateUserRequest) => usersSend({ type: "CREATE", user })}
       onCancel={() => navigate("/users")}
       isLoading={usersState.hasTag("loading")}
-      error={hasUnknownError ? Language.unknownError : undefined}
+      error={genericError}
     />
   )
 }
diff --git a/site/src/xServices/users/usersXService.ts b/site/src/xServices/users/usersXService.ts
index 71c5129aff..7624250c19 100644
--- a/site/src/xServices/users/usersXService.ts
+++ b/site/src/xServices/users/usersXService.ts
@@ -1,6 +1,7 @@
 import { NavigateFunction } from "react-router"
 import { assign, createMachine } from "xstate"
 import * as API from "../../api"
+import { ApiError, FieldErrors, isApiError, mapApiErrorToFieldErrors } from "../../api/errors"
 import * as Types from "../../api/types"
 import * as TypesGen from "../../api/typesGenerated"
 import { displaySuccess } from "../../components/GlobalSnackbar/utils"
@@ -14,6 +15,7 @@ export interface UsersContext {
   pager?: Types.Pager
   getUsersError?: Error | unknown
   createUserError?: Error | unknown
+  createUserFormErrors?: FieldErrors
   navigate?: NavigateFunction
 }
 
@@ -73,10 +75,17 @@ export const usersMachine = createMachine(
             target: "idle",
             actions: ["displayCreateUserSuccess", "redirectToUsersPage", "clearCreateUserError"],
           },
-          onError: {
-            target: "idle",
-            actions: ["assignCreateUserError"],
-          },
+          onError: [
+            {
+              target: "idle",
+              cond: "isFormError",
+              actions: ["assignCreateUserFormErrors"],
+            },
+            {
+              target: "idle",
+              actions: ["assignCreateUserError"],
+            },
+          ],
         },
         tags: "loading",
       },
@@ -92,6 +101,9 @@ export const usersMachine = createMachine(
       getUsers: API.getUsers,
       createUser: (_, event) => API.createUser(event.user),
     },
+    guards: {
+      isFormError: (_, event) => isApiError(event.data)
+    },
     actions: {
       assignUsers: assign({
         users: (_, event) => event.data.page,
@@ -107,6 +119,10 @@ export const usersMachine = createMachine(
       assignCreateUserError: assign({
         createUserError: (_, event) => event.data,
       }),
+      assignCreateUserFormErrors: assign({
+        // the guard ensures it is ApiError
+        createUserFormErrors: (_, event) => mapApiErrorToFieldErrors((event.data as ApiError).response.data)
+      }),
       clearCreateUserError: assign((context: UsersContext) => ({
         ...context,
         createUserError: undefined,
@@ -116,7 +132,7 @@ export const usersMachine = createMachine(
       },
       redirectToUsersPage: (context) => {
         context.navigate && context.navigate("/users")
-      }
+      },
     },
   },
 )