diff --git a/integration/diagnose_test.go b/integration/diagnose_test.go
index ccd2c22008f..504f31af130 100644
--- a/integration/diagnose_test.go
+++ b/integration/diagnose_test.go
@@ -25,6 +25,9 @@ import (
 	"text/template"
 
 	"github.com/GoogleContainerTools/skaffold/v2/integration/skaffold"
+	"github.com/GoogleContainerTools/skaffold/v2/pkg/skaffold/schema/latest"
+	"github.com/GoogleContainerTools/skaffold/v2/pkg/skaffold/schema/util"
+	"github.com/GoogleContainerTools/skaffold/v2/pkg/skaffold/yaml"
 	"github.com/GoogleContainerTools/skaffold/v2/testutil"
 )
 
@@ -83,12 +86,12 @@ func TestDiagnose(t *testing.T) {
 			configContents, err := os.ReadFile(filepath.Join(test.dir, "skaffold.yaml"))
 			t.CheckNoError(err)
 			templ, err := os.ReadFile(filepath.Join(test.dir, "diagnose.tmpl"))
+			t.CheckNoError(err)
 			tmpDir.Write("skaffold.yaml", string(configContents))
 			args := []string{"--yaml-only", "--output", tmpDir.Path(test.outputFile), "-f", tmpDir.Path("skaffold.yaml")}
 			args = append(args, test.args...)
 			skaffold.Diagnose(args...).
 				InDir(test.dir).RunOrFail(t.T)
-			t.CheckNoError(err)
 			outTemplate := template.Must(template.New("tmpl").Parse(string(templ)))
 			cwd, err := filepath.Abs(test.dir)
 			t.CheckNoError(err)
@@ -96,7 +99,6 @@ func TestDiagnose(t *testing.T) {
 			outTemplate.Execute(expected, map[string]string{"Root": cwd})
 
 			outputPath := tmpDir.Path(test.outputFile)
-			t.CheckNoError(err)
 			out, err := os.ReadFile(outputPath)
 			t.CheckNoError(err)
 			t.CheckDeepEqual(expected.String(), string(out), testutil.YamlObj(t.T))
@@ -104,6 +106,61 @@ func TestDiagnose(t *testing.T) {
 	}
 }
 
+// During the schema upgrade(v2beta28->v2beta29),  Skaffold injects setTemplate fields into the configuration if a legacy Helm deployer is configured.
+// These injected fields contain templates, and we want to ensure that when expanding them with Go templates, the original field values remain unchanged
+// when environment variables are not set.  This is important because users who use the skaffold diagnose command on the old schema
+// with Helm might not be aware  of the existence of these templated fields, leading to templating failures.
+func TestDiagnoseTemplatingNotAllEnvsSet(t *testing.T) {
+	tests := []struct {
+		description string
+		dir         string
+		outputFile  string
+		args        []string
+		envs        map[string]string
+	}{
+		{
+			description: "apply replacements to templates in skaffold.yaml",
+			dir:         "testdata/diagnose/not-all-envs-set",
+			outputFile:  "abc.txt",
+			args:        []string{"--enable-templating"},
+			envs:        map[string]string{"AAA": "aaa"},
+		},
+	}
+
+	for _, test := range tests {
+		MarkIntegrationTest(t, CanRunWithoutGcp)
+		testutil.Run(t, test.description, func(t *testutil.T) {
+			if test.envs != nil {
+				for k, v := range test.envs {
+					t.Setenv(k, v)
+				}
+			}
+			tmpDir := testutil.NewTempDir(t.T)
+			configContents, err := os.ReadFile(filepath.Join(test.dir, "skaffold.yaml"))
+			t.CheckNoError(err)
+			tmpDir.Write("skaffold.yaml", string(configContents))
+			outputPath := tmpDir.Path(test.outputFile)
+			args := []string{"--yaml-only", "--output", outputPath, "-f", tmpDir.Path("skaffold.yaml")}
+			args = append(args, test.args...)
+			skaffold.Diagnose(args...).
+				InDir(test.dir).RunOrFail(t.T)
+			out, err := os.ReadFile(outputPath)
+			t.CheckNoError(err)
+			var conf latest.SkaffoldConfig
+			yaml.Unmarshal(out, &conf)
+			// templates unchanged
+			t.CheckDeepEqual(conf.Deploy.LegacyHelmDeploy.Releases[0].SetValueTemplates, util.FlatMap{"image.repository": "{{.IMAGE_REPO_test_image}}",
+				"image.tag": "{{.IMAGE_TAG_test_image}}@{{.IMAGE_DIGEST_test_image}}",
+			})
+			cwd, err := filepath.Abs(test.dir)
+			t.CheckNoError(err)
+
+			// templates successfully expanded.
+			t.CheckDeepEqual(conf.Deploy.LegacyHelmDeploy.Releases[0].ValuesFiles[0], cwd+"/aaa/test-values.yaml")
+		})
+	}
+}
+
 func folders(root string) ([]string, error) {
 	var folders []string
 
diff --git a/integration/testdata/diagnose/not-all-envs-set/skaffold.yaml b/integration/testdata/diagnose/not-all-envs-set/skaffold.yaml
new file mode 100644
index 00000000000..406166ccdb7
--- /dev/null
+++ b/integration/testdata/diagnose/not-all-envs-set/skaffold.yaml
@@ -0,0 +1,19 @@
+apiVersion: skaffold/v2beta26
+kind: Config
+metadata:
+  name: cio-cloud-project-mgmt-api
+build:
+  artifacts:
+    - image: test-image
+deploy:
+  helm:
+    releases:
+      - name: test-release
+        artifactOverrides:
+          image: test-image
+        valuesFiles:
+          - '{{.AAA}}/test-values.yaml'
+        remoteChart: "oci://test-chart"
+        version: 1.21.2
+        imageStrategy:
+          helm: {}
\ No newline at end of file