diff --git a/.changelog/1131.txt b/.changelog/1131.txt
new file mode 100644
index 000000000..4fe4cc511
--- /dev/null
+++ b/.changelog/1131.txt
@@ -0,0 +1,3 @@
+```release-note:bug
+Retry billing service update call when creating a project
+```
diff --git a/internal/clients/retry_request.go b/internal/clients/retry_request.go
index 0cd88181f..93bb3ebc4 100644
--- a/internal/clients/retry_request.go
+++ b/internal/clients/retry_request.go
@@ -7,6 +7,7 @@ import (
 	"fmt"
 	"time"
 
+	billing "github.com/hashicorp/hcp-sdk-go/clients/cloud-billing/preview/2020-11-05/client/billing_account_service"
 	"github.com/hashicorp/hcp-sdk-go/clients/cloud-resource-manager/stable/2019-12-10/client/organization_service"
 	"github.com/hashicorp/hcp-sdk-go/clients/cloud-resource-manager/stable/2019-12-10/client/project_service"
 )
@@ -108,3 +109,30 @@ func RetryProjectServiceGet(client *Client, params *project_service.ProjectServi
 	}
 	return resp, err
 }
+
+// Wraps the BillingServiceUpdate function in a loop that supports retrying the PUT request
+func RetryBillingServiceUpdate(client *Client, params *billing.BillingAccountServiceUpdateParams) (*billing.BillingAccountServiceUpdateOK, error) {
+	resp, err := client.Billing.BillingAccountServiceUpdate(params, nil)
+
+	if err != nil {
+		serviceErr, ok := err.(*billing.BillingAccountServiceUpdateDefault)
+		if !ok {
+			return nil, err
+		}
+
+		counter := counterStart
+		for shouldRetryErrorCode(serviceErr.Code(), []int{503}) && counter < retryCount {
+			resp, err = client.Billing.BillingAccountServiceUpdate(params, nil)
+			if err == nil {
+				break
+			}
+			// Avoid wasting time if we're not going to retry next loop cycle
+			if (counter + 1) != retryCount {
+				fmt.Printf("Error trying to update billing account. Retrying in %d seconds...", retryDelay*counter)
+				time.Sleep(time.Duration(retryDelay*counter) * time.Second)
+			}
+			counter++
+		}
+	}
+	return resp, err
+}
diff --git a/internal/provider/resourcemanager/resource_project.go b/internal/provider/resourcemanager/resource_project.go
index c9ae1656a..4bab53ed2 100644
--- a/internal/provider/resourcemanager/resource_project.go
+++ b/internal/provider/resourcemanager/resource_project.go
@@ -168,7 +168,7 @@ func (r *resourceProject) addToBillingAccount(ctx context.Context, projectID str
 
 	updateReq.Body.ProjectIds = append(updateReq.Body.ProjectIds, projectID)
 
-	_, err = r.client.Billing.BillingAccountServiceUpdate(updateReq, nil)
+	_, err = clients.RetryBillingServiceUpdate(r.client, updateReq)
 	if err != nil {
 		return fmt.Errorf("updating billing account failed: %v", err.Error())
 	}