diff --git a/homeassistant/components/esphome/dashboard.py b/homeassistant/components/esphome/dashboard.py
index c9d74f0b30c62a..4cbb9cbe847281 100644
--- a/homeassistant/components/esphome/dashboard.py
+++ b/homeassistant/components/esphome/dashboard.py
@@ -93,13 +93,6 @@ async def async_set_dashboard_info(
             hass, addon_slug, url, async_get_clientsession(hass)
         )
         await dashboard.async_request_refresh()
-        if not cur_dashboard and not dashboard.last_update_success:
-            # If there was no previous dashboard and the new one is not available,
-            # we skip setup and wait for discovery.
-            _LOGGER.error(
-                "Dashboard unavailable; skipping setup: %s", dashboard.last_exception
-            )
-            return
 
         self._current_dashboard = dashboard
 
diff --git a/tests/components/esphome/test_dashboard.py b/tests/components/esphome/test_dashboard.py
index d16bf7c4d0073d..d8732ea0453f0b 100644
--- a/tests/components/esphome/test_dashboard.py
+++ b/tests/components/esphome/test_dashboard.py
@@ -58,7 +58,9 @@ async def test_setup_dashboard_fails(
         assert mock_config_entry.state == ConfigEntryState.LOADED
         assert mock_get_devices.call_count == 1
 
-    assert dashboard.STORAGE_KEY not in hass_storage
+    # The dashboard addon might recover later so we still
+    # allow it to be set up.
+    assert dashboard.STORAGE_KEY in hass_storage
 
 
 async def test_setup_dashboard_fails_when_already_setup(