diff --git a/internal/services/containerapps/container_app_environment_resource.go b/internal/services/containerapps/container_app_environment_resource.go
index c915e7bed6a2..a7254cfe1438 100644
--- a/internal/services/containerapps/container_app_environment_resource.go
+++ b/internal/services/containerapps/container_app_environment_resource.go
@@ -69,7 +69,7 @@ func (r ContainerAppEnvironmentResource) Arguments() map[string]*pluginsdk.Schem
 
 		"log_analytics_workspace_id": {
 			Type:         pluginsdk.TypeString,
-			Required:     true,
+			Optional:     true,
 			ForceNew:     true,
 			ValidateFunc: workspaces.ValidateWorkspaceID,
 			Description:  "The ID for the Log Analytics Workspace to link this Container Apps Managed Environment to.",
@@ -156,49 +156,50 @@ func (r ContainerAppEnvironmentResource) Create() sdk.ResourceFunc {
 				return metadata.ResourceRequiresImport(r.ResourceType(), id)
 			}
 
-			logAnalyticsId, err := workspaces.ParseWorkspaceID(containerAppEnvironment.LogAnalyticsWorkspaceId)
-			if err != nil {
-				return err
-			}
-
-			workspace, err := logAnalyticsClient.Get(ctx, *logAnalyticsId)
-			if err != nil {
-				return fmt.Errorf("retrieving %s for %s: %+v", logAnalyticsId, id, err)
-			}
-
-			if workspace.Model == nil || workspace.Model.Properties == nil {
-				return fmt.Errorf("reading customer ID from %s", logAnalyticsId)
-			}
-
-			if workspace.Model.Properties.CustomerId == nil {
-				return fmt.Errorf("reading customer ID from %s, `customer_id` is nil", logAnalyticsId)
-			}
-
-			keys, err := logAnalyticsClient.SharedKeysGetSharedKeys(ctx, *logAnalyticsId)
-			if err != nil {
-				return fmt.Errorf("retrieving access keys to %s for %s: %+v", logAnalyticsId, id, err)
-			}
-
-			if keys.Model.PrimarySharedKey == nil {
-				return fmt.Errorf("reading shared key for %s in %s", logAnalyticsId, id)
-			}
-
 			managedEnvironment := managedenvironments.ManagedEnvironment{
 				Location: containerAppEnvironment.Location,
 				Name:     pointer.To(containerAppEnvironment.Name),
 				Properties: &managedenvironments.ManagedEnvironmentProperties{
-					AppLogsConfiguration: &managedenvironments.AppLogsConfiguration{
-						Destination: pointer.To("log-analytics"),
-						LogAnalyticsConfiguration: &managedenvironments.LogAnalyticsConfiguration{
-							CustomerId: workspace.Model.Properties.CustomerId,
-							SharedKey:  keys.Model.PrimarySharedKey,
-						},
-					},
 					VnetConfiguration: &managedenvironments.VnetConfiguration{},
 				},
 				Tags: tags.Expand(containerAppEnvironment.Tags),
 			}
 
+			if containerAppEnvironment.LogAnalyticsWorkspaceId != "" {
+				logAnalyticsId, err := workspaces.ParseWorkspaceID(containerAppEnvironment.LogAnalyticsWorkspaceId)
+				if err != nil {
+					return err
+				}
+
+				workspace, err := logAnalyticsClient.Get(ctx, *logAnalyticsId)
+				if err != nil {
+					return fmt.Errorf("retrieving %s for %s: %+v", logAnalyticsId, id, err)
+				}
+
+				if workspace.Model == nil || workspace.Model.Properties == nil {
+					return fmt.Errorf("reading customer ID from %s", logAnalyticsId)
+				}
+
+				if workspace.Model.Properties.CustomerId == nil {
+					return fmt.Errorf("reading customer ID from %s, `customer_id` is nil", logAnalyticsId)
+				}
+
+				keys, err := logAnalyticsClient.SharedKeysGetSharedKeys(ctx, *logAnalyticsId)
+				if err != nil {
+					return fmt.Errorf("retrieving access keys to %s for %s: %+v", logAnalyticsId, id, err)
+				}
+				if keys.Model.PrimarySharedKey == nil {
+					return fmt.Errorf("reading shared key for %s in %s", logAnalyticsId, id)
+				}
+				managedEnvironment.Properties.AppLogsConfiguration = &managedenvironments.AppLogsConfiguration{
+					Destination: pointer.To("log-analytics"),
+					LogAnalyticsConfiguration: &managedenvironments.LogAnalyticsConfiguration{
+						CustomerId: workspace.Model.Properties.CustomerId,
+						SharedKey:  keys.Model.PrimarySharedKey,
+					},
+				}
+			}
+
 			if containerAppEnvironment.InfrastructureSubnetId != "" {
 				managedEnvironment.Properties.VnetConfiguration.InfrastructureSubnetId = pointer.To(containerAppEnvironment.InfrastructureSubnetId)
 				managedEnvironment.Properties.VnetConfiguration.Internal = pointer.To(containerAppEnvironment.InternalLoadBalancerEnabled)
diff --git a/internal/services/containerapps/container_app_environment_resource_test.go b/internal/services/containerapps/container_app_environment_resource_test.go
index 15a0990e373d..c9729b562908 100644
--- a/internal/services/containerapps/container_app_environment_resource_test.go
+++ b/internal/services/containerapps/container_app_environment_resource_test.go
@@ -30,7 +30,7 @@ func TestAccContainerAppEnvironment_basic(t *testing.T) {
 				check.That(data.ResourceName).ExistsInAzure(r),
 			),
 		},
-		data.ImportStep("log_analytics_workspace_id"),
+		data.ImportStep(),
 	})
 }
 
@@ -112,10 +112,9 @@ provider "azurerm" {
 %[1]s
 
 resource "azurerm_container_app_environment" "test" {
-  name                       = "acctest-CAEnv%[2]d"
-  resource_group_name        = azurerm_resource_group.test.name
-  location                   = azurerm_resource_group.test.location
-  log_analytics_workspace_id = azurerm_log_analytics_workspace.test.id
+  name                = "acctest-CAEnv%[2]d"
+  resource_group_name = azurerm_resource_group.test.name
+  location            = azurerm_resource_group.test.location
 }
 `, r.template(data), data.RandomInteger)
 }
@@ -123,13 +122,13 @@ resource "azurerm_container_app_environment" "test" {
 func (r ContainerAppEnvironmentResource) requiresImport(data acceptance.TestData) string {
 	return fmt.Sprintf(`
 
+
 %[1]s
 
 resource "azurerm_container_app_environment" "import" {
-  name                       = azurerm_container_app_environment.test.name
-  resource_group_name        = azurerm_container_app_environment.test.resource_group_name
-  location                   = azurerm_container_app_environment.test.location
-  log_analytics_workspace_id = azurerm_container_app_environment.test.log_analytics_workspace_id
+  name                = azurerm_container_app_environment.test.name
+  resource_group_name = azurerm_container_app_environment.test.resource_group_name
+  location            = azurerm_container_app_environment.test.location
 }
 `, r.basic(data), data.RandomInteger)
 }
diff --git a/website/docs/r/container_app_environment.html.markdown b/website/docs/r/container_app_environment.html.markdown
index fc6ff34a8f3d..265dffac789f 100644
--- a/website/docs/r/container_app_environment.html.markdown
+++ b/website/docs/r/container_app_environment.html.markdown
@@ -44,8 +44,6 @@ The following arguments are supported:
 
 * `location` - (Required) Specifies the supported Azure location where the Container App Environment is to exist. Changing this forces a new resource to be created.
 
-* `log_analytics_workspace_id` - (Required) The ID for the Log Analytics Workspace to link this Container Apps Managed Environment to. Changing this forces a new resource to be created.
-
 ---
 
 * `infrastructure_subnet_id` - (Optional) The existing Subnet to use for the Container Apps Control Plane. Changing this forces a new resource to be created. 
@@ -56,6 +54,8 @@ The following arguments are supported:
 
 ~> **Note:** can only be set to `true` if `infrastructure_subnet_id` is specified. 
 
+* `log_analytics_workspace_id` - (Optional) The ID for the Log Analytics Workspace to link this Container Apps Managed Environment to. Changing this forces a new resource to be created.
+
 * `tags` - (Optional) A mapping of tags to assign to the resource.
 
 ## Attributes Reference