diff --git a/sdk/core/azure-core/CHANGELOG.md b/sdk/core/azure-core/CHANGELOG.md
index f77fe1020e82..5f7669b06113 100644
--- a/sdk/core/azure-core/CHANGELOG.md
+++ b/sdk/core/azure-core/CHANGELOG.md
@@ -1,5 +1,11 @@
 # Release History
 
+## 1.42.0 (Unreleased)
+
+### Bugs Fixed
+
+- Fixed `HttpRequest` encoding multipart payloads that carry form data but no file (e.g. when the file part is optional and omitted) as `application/x-www-form-urlencoded`. Such requests can now be flagged with the internal `is_multipart_payload` keyword; the form fields are then encoded as file-less multipart parts so the request is sent as `multipart/form-data`. #39163
+
 ## 1.41.0 (2026-05-07)
 
 ### Features Added
diff --git a/sdk/core/azure-core/azure/core/_version.py b/sdk/core/azure-core/azure/core/_version.py
index b61909f350dd..7e497df87224 100644
--- a/sdk/core/azure-core/azure/core/_version.py
+++ b/sdk/core/azure-core/azure/core/_version.py
@@ -9,4 +9,4 @@
 # regenerated.
 # --------------------------------------------------------------------------
 
-VERSION = "1.41.0"
+VERSION = "1.42.0"
diff --git a/sdk/core/azure-core/azure/core/rest/_rest_py3.py b/sdk/core/azure-core/azure/core/rest/_rest_py3.py
index 97c3658f5497..b42c496adb0d 100644
--- a/sdk/core/azure-core/azure/core/rest/_rest_py3.py
+++ b/sdk/core/azure-core/azure/core/rest/_rest_py3.py
@@ -116,6 +116,7 @@ def __init__(
             data=data,
             files=files,
             json=json,
+            is_multipart_payload=kwargs.pop("is_multipart_payload", False),
         )
         self.headers: MutableMapping[str, str] = case_insensitive_dict(default_headers)
         self.headers.update(headers or {})
@@ -131,6 +132,7 @@ def _set_body(
         data: Optional[Dict[str, Any]] = None,
         files: Optional[FilesType] = None,
         json: Any = None,
+        is_multipart_payload: bool = False,
     ) -> MutableMapping[str, str]:
         """Sets the body of the request, and returns the default headers.
 
@@ -139,6 +141,10 @@ def _set_body(
         :param dict data: Form data you want in your request body.
         :param dict files: Files you want to in your request body.
         :param any json: A JSON serializable object.
+        :param bool is_multipart_payload: Whether the payload is meant to be sent as
+         multipart/form-data. When True, the request is treated as multipart even if
+         no file is present (e.g. the file part is optional and omitted), so it is not
+         mislabeled as ``application/x-www-form-urlencoded``.
         :return: The default headers for the request
         :rtype: MutableMapping[str, str]
         """
@@ -155,7 +161,15 @@ def _set_body(
         if files:
             default_headers, self._files = set_multipart_body(files)
         if data:
-            default_headers, self._data = set_urlencoded_body(data, has_files=bool(files))
+            if is_multipart_payload and not files:
+                # A multipart payload whose only file part is optional (and omitted) must
+                # still be sent as multipart/form-data, not application/x-www-form-urlencoded.
+                # Transports build the multipart body from `files`, so encode the form
+                # fields as file-less parts (name, (None, value)) instead of url-encoding them.
+                default_headers, self._files = set_multipart_body(data)
+                self._data = None
+            else:
+                default_headers, self._data = set_urlencoded_body(data, has_files=bool(files))
         return default_headers
 
     @property
diff --git a/sdk/core/azure-core/tests/test_rest_http_request.py b/sdk/core/azure-core/tests/test_rest_http_request.py
index 7ad245d30bb2..400490f8a1b3 100644
--- a/sdk/core/azure-core/tests/test_rest_http_request.py
+++ b/sdk/core/azure-core/tests/test_rest_http_request.py
@@ -88,6 +88,35 @@ def test_url_encoded_data():
     }  # httpx makes this just b'test=123'. set_formdata_body is still keeping it as a dict
 
 
+def test_multipart_data_without_files():
+    # A multipart payload whose file part is optional (and omitted) still must be sent
+    # as multipart, not application/x-www-form-urlencoded. See issue #39163.
+    # The transports build a multipart body from `files`, so the form fields are encoded
+    # as file-less parts and `data` is cleared.
+    request = HttpRequest(
+        "POST",
+        "http://example.org",
+        data={"test": "123"},
+        is_multipart_payload=True,
+    )
+
+    assert "Content-Type" not in request.headers
+    assert request.files == {"test": (None, "123")}
+    assert request.data is None
+
+
+def test_url_encoded_data_when_not_multipart():
+    # Without the multipart flag, data-only requests remain urlencoded (default behavior).
+    request = HttpRequest(
+        "POST",
+        "http://example.org",
+        data={"test": "123"},
+        is_multipart_payload=False,
+    )
+
+    assert request.headers["Content-Type"] == "application/x-www-form-urlencoded"
+
+
 def test_json_encoded_data():
     request = HttpRequest("POST", "http://example.org", json={"test": 123})