diff --git a/src/Activity/ActivityCancellationType.php b/src/Activity/ActivityCancellationType.php
index 9c596756..ef459a76 100644
--- a/src/Activity/ActivityCancellationType.php
+++ b/src/Activity/ActivityCancellationType.php
@@ -63,7 +63,7 @@ public function serialize($value)
                 return false;
 
             default:
-                $error = "Option #${value} is currently not supported";
+                $error = "Option #{$value} is currently not supported";
                 throw new \InvalidArgumentException($error);
         }
     }
diff --git a/src/Internal/Declaration/WorkflowInstance.php b/src/Internal/Declaration/WorkflowInstance.php
index dfc7f800..0b0feb9a 100644
--- a/src/Internal/Declaration/WorkflowInstance.php
+++ b/src/Internal/Declaration/WorkflowInstance.php
@@ -121,4 +121,9 @@ public function addSignalHandler(string $name, callable $handler): void
         $this->signalHandlers[$name] = $this->createCallableHandler($handler);
         $this->signalQueue->attach($name, $this->signalHandlers[$name]);
     }
+
+    public function clearSignalQueue(): void
+    {
+        $this->signalQueue->clear();
+    }
 }
diff --git a/src/Internal/Declaration/WorkflowInstance/SignalQueue.php b/src/Internal/Declaration/WorkflowInstance/SignalQueue.php
index 5fb9a1f7..0b1bdba0 100644
--- a/src/Internal/Declaration/WorkflowInstance/SignalQueue.php
+++ b/src/Internal/Declaration/WorkflowInstance/SignalQueue.php
@@ -67,6 +67,11 @@ public function attach(string $signal, callable $consumer): void
         $this->flush($signal);
     }
 
+    public function clear(): void
+    {
+        $this->queue = [];
+    }
+
     /**
      * @param string $signal
      * @psalm-suppress UnusedVariable
diff --git a/src/Internal/Declaration/WorkflowInstanceInterface.php b/src/Internal/Declaration/WorkflowInstanceInterface.php
index 3cefc378..ec953ed1 100644
--- a/src/Internal/Declaration/WorkflowInstanceInterface.php
+++ b/src/Internal/Declaration/WorkflowInstanceInterface.php
@@ -41,4 +41,6 @@ public function getSignalHandler(string $name): \Closure;
      * @param callable $handler
      */
     public function addSignalHandler(string $name, callable $handler): void;
+
+    public function clearSignalQueue(): void;
 }
diff --git a/src/Internal/Workflow/Process/Process.php b/src/Internal/Workflow/Process/Process.php
index 64ec6243..9f16fddf 100644
--- a/src/Internal/Workflow/Process/Process.php
+++ b/src/Internal/Workflow/Process/Process.php
@@ -14,7 +14,6 @@
 use JetBrains\PhpStorm\Pure;
 use Temporal\DataConverter\ValuesInterface;
 use Temporal\Exception\DestructMemorizedInstanceException;
-use Temporal\Exception\InvalidArgumentException;
 use Temporal\Internal\Declaration\WorkflowInstanceInterface;
 use Temporal\Internal\ServiceContainer;
 use Temporal\Internal\Workflow\WorkflowContext;
@@ -44,11 +43,7 @@ function (?\Throwable $error): void {
                     }
                 );
 
-                try {
-                    $scope->start($handler);
-                } catch (InvalidArgumentException $e) {
-                    // invalid signal invocation, destroy the scope with no traces
-                }
+                $scope->startSignal($handler);
             }
         );
 
diff --git a/src/Internal/Workflow/Process/Scope.php b/src/Internal/Workflow/Process/Scope.php
index cdcffdf4..545ba177 100644
--- a/src/Internal/Workflow/Process/Scope.php
+++ b/src/Internal/Workflow/Process/Scope.php
@@ -19,6 +19,7 @@
 use Temporal\Exception\DestructMemorizedInstanceException;
 use Temporal\Exception\Failure\CanceledFailure;
 use Temporal\Exception\Failure\TemporalFailure;
+use Temporal\Exception\InvalidArgumentException;
 use Temporal\Internal\ServiceContainer;
 use Temporal\Internal\Transport\Request\Cancel;
 use Temporal\Internal\Workflow\ScopeContext;
@@ -167,6 +168,7 @@ public function getContext(): WorkflowContext
     public function start(callable $handler, ValuesInterface $values = null): void
     {
         try {
+            // Create a coroutine generator
             $this->coroutine = $this->call($handler, $values ?? EncodedValues::empty());
             $this->context->resolveConditions();
         } catch (\Throwable $e) {
@@ -177,6 +179,17 @@ public function start(callable $handler, ValuesInterface $values = null): void
         $this->next();
     }
 
+    /**
+     * @param callable $handler
+     */
+    public function startSignal(callable $handler): void
+    {
+        // Create a coroutine generator
+        $this->coroutine = $this->callSignalHandler($handler);
+        $this->context->resolveConditions();
+        $this->next();
+    }
+
     /**
      * @param \Generator $generator
      * @return self
@@ -322,16 +335,49 @@ function () use ($cancelID): void {
      */
     protected function call(callable $handler, ValuesInterface $values): \Generator
     {
-        $this->makeCurrent();
-        $result = $handler($values);
+        try {
+            $this->makeCurrent();
+            $result = $handler($values);
 
-        if ($result instanceof \Generator) {
-            yield from $result;
+            if ($result instanceof \Generator) {
+                yield from $result;
+
+                return $result->getReturn();
+            }
 
-            return $result->getReturn();
+            return $result;
+        } catch (\Throwable $e) {
+            $this->onException($e);
         }
+    }
 
-        return $result;
+    /**
+     * Call a Signal method. In this case deserialization errors are skipped.
+     *
+     * @param callable $handler
+     * @return \Generator
+     */
+    protected function callSignalHandler(callable $handler): \Generator
+    {
+        try {
+            $this->makeCurrent();
+            try {
+                $result = $handler();
+            } catch (InvalidArgumentException) {
+                // Skip deserialization errors
+                return null;
+            }
+
+            if ($result instanceof \Generator) {
+                yield from $result;
+
+                return $result->getReturn();
+            }
+
+            return $result;
+        } catch (\Throwable $e) {
+            $this->onException($e);
+        }
     }
 
     /**
diff --git a/src/Internal/Workflow/WorkflowContext.php b/src/Internal/Workflow/WorkflowContext.php
index 2cc3ab8c..212ad412 100644
--- a/src/Internal/Workflow/WorkflowContext.php
+++ b/src/Internal/Workflow/WorkflowContext.php
@@ -228,6 +228,10 @@ public function isReplaying(): bool
      */
     public function complete(array $result = null, \Throwable $failure = null): PromiseInterface
     {
+        if ($failure !== null) {
+            $this->workflowInstance->clearSignalQueue();
+        }
+
         if ($result !== null) {
             $values = EncodedValues::fromValues($result);
         } else {
diff --git a/tests/Fixtures/src/Workflow/LoopWithSignalCoroutinesWorkflow.php b/tests/Fixtures/src/Workflow/LoopWithSignalCoroutinesWorkflow.php
index da6c50ea..d304a8a5 100644
--- a/tests/Fixtures/src/Workflow/LoopWithSignalCoroutinesWorkflow.php
+++ b/tests/Fixtures/src/Workflow/LoopWithSignalCoroutinesWorkflow.php
@@ -30,7 +30,7 @@ public function __construct()
         $this->simple = Workflow::newActivityStub(
             SimpleActivity::class,
             ActivityOptions::new()
-                ->withStartToCloseTimeout(5)
+                ->withStartToCloseTimeout(10)
                 ->withRetryOptions(RetryOptions::new()->withMaximumAttempts(1))
         );
     }
diff --git a/tests/Fixtures/src/Workflow/SignalExceptionsWorkflow.php b/tests/Fixtures/src/Workflow/SignalExceptionsWorkflow.php
new file mode 100644
index 00000000..044b2537
--- /dev/null
+++ b/tests/Fixtures/src/Workflow/SignalExceptionsWorkflow.php
@@ -0,0 +1,81 @@
+<?php
+
+/**
+ * This file is part of Temporal package.
+ *
+ * For the full copyright and license information, please view the LICENSE
+ * file that was distributed with this source code.
+ */
+
+declare(strict_types=1);
+
+namespace Temporal\Tests\Workflow;
+
+use InvalidArgumentException;
+use Temporal\Activity\ActivityOptions;
+use Temporal\Common\RetryOptions;
+use Temporal\Workflow;
+use Temporal\Workflow\SignalMethod;
+use Temporal\Workflow\WorkflowInterface;
+use Temporal\Workflow\WorkflowMethod;
+
+#[WorkflowInterface]
+class SignalExceptionsWorkflow
+{
+    private array $greetings = [];
+    private bool $exit = false;
+
+    #[WorkflowMethod(name: "SignalExceptions.greet")]
+    public function greet()
+    {
+        $received = [];
+        while (true) {
+            yield Workflow::await(fn() => $this->greetings !== [] || $this->exit);
+            if ($this->greetings === [] && $this->exit) {
+                return $received;
+            }
+
+            $message = array_shift($this->greetings);
+            $received[] = $message;
+        }
+    }
+
+    #[SignalMethod]
+    public function failWithName(string $name): void
+    {
+        $this->greetings[] = $name;
+        throw new \RuntimeException("Signal exception $name");
+    }
+
+    #[SignalMethod]
+    public function failInvalidArgument($name = 'foo'): void
+    {
+        $this->greetings[] = "invalidArgument $name";
+        throw new InvalidArgumentException("Invalid argument $name");
+    }
+
+    #[SignalMethod]
+    public function failActivity($name = 'foo')
+    {
+        yield Workflow::newUntypedActivityStub(
+            ActivityOptions::new()
+                ->withScheduleToStartTimeout(1)
+                ->withRetryOptions(
+                    RetryOptions::new()->withMaximumAttempts(1)
+                )
+                ->withStartToCloseTimeout(1),
+        )->execute('nonExistingActivityName', [$name]);
+    }
+
+    #[SignalMethod]
+    public function failRetryable()
+    {
+        10 / 0;
+    }
+
+    #[SignalMethod]
+    public function exit(): void
+    {
+        $this->exit = true;
+    }
+}
diff --git a/tests/Functional/Client/AwaitTestCase.php b/tests/Functional/Client/AwaitTestCase.php
index 2b4614a7..44dbfc5f 100644
--- a/tests/Functional/Client/AwaitTestCase.php
+++ b/tests/Functional/Client/AwaitTestCase.php
@@ -132,14 +132,18 @@ public function testFailSignalSerialization()
         $wait->addValue('test2');
         $wait->addValue('test3');
 
-        // breaks the invocation
+        /**
+         * Breaks the invocation
+         * Deserialization errors must be ignored. Called Signal method in this case will be skipped.
+         * @link https://github.com/temporalio/sdk-php/pull/331
+         */
         $wait->addValue(['hello'], 123);
 
         $wait->addValue('test4');
 
         $result = $run->getResult();
-        asort($result);
-        $result = array_values($result);
+        \asort($result);
+        $result = \array_values($result);
 
         $this->assertSame(
             [
diff --git a/tests/Functional/Client/FailureTestCase.php b/tests/Functional/Client/FailureTestCase.php
index 88297e2d..275dc893 100644
--- a/tests/Functional/Client/FailureTestCase.php
+++ b/tests/Functional/Client/FailureTestCase.php
@@ -11,10 +11,13 @@
 
 namespace Temporal\Tests\Functional\Client;
 
+use PHPUnit\Framework\AssertionFailedError;
 use Temporal\Exception\Client\WorkflowFailedException;
+use Temporal\Exception\Client\WorkflowNotFoundException;
 use Temporal\Exception\Failure\ActivityFailure;
 use Temporal\Exception\Failure\ApplicationFailure;
 use Temporal\Exception\Failure\ChildWorkflowFailure;
+use Temporal\Tests\Workflow\SignalExceptionsWorkflow;
 
 /**
  * @group client
@@ -80,4 +83,82 @@ public function testChildWorkflowFailurePropagation()
             $this->assertStringContainsString('SimpleActivity->fail', $e->getPrevious()->getMessage());
         }
     }
+
+    public function testSignalThatThrowsRetryableException()
+    {
+        $client = $this->createClient();
+        $wf = $client->newWorkflowStub(SignalExceptionsWorkflow::class);
+
+        $run = $client->start($wf);
+
+        $wf->failRetryable();
+
+        sleep(1);
+        $wf->exit();
+
+        // There is no any exception because the workflow has not failed after the `failRetryable` signal.
+        $this->assertTrue(true);
+    }
+
+    public function testSignalThatThrowsCustomError()
+    {
+        $client = $this->createClient();
+        $wf = $client->newWorkflowStub(SignalExceptionsWorkflow::class);
+
+        $run = $client->start($wf);
+
+        $wf->failWithName('test1');
+
+        try {
+            // The next
+            sleep(2);
+            $wf->exit();
+            $this->fail('Signal must fail');
+        } catch (AssertionFailedError $e) {
+            throw $e;
+        } catch (\Throwable $e) {
+            $this->assertInstanceOf(WorkflowNotFoundException::class, $e);
+            // \dump($e);
+        }
+
+        $this->expectException(WorkflowFailedException::class);
+        $result = $run->getResult();
+        $this->fail(sprintf("Workflow must fail. Got result %s", \print_r($result, true)));
+    }
+
+    public function testSignalThatThrowsInvalidArgumentException()
+    {
+        $client = $this->createClient();
+        $wf = $client->newWorkflowStub(SignalExceptionsWorkflow::class);
+
+        $run = $client->start($wf);
+
+        $wf->failInvalidArgument('test1');
+
+        $this->expectException(WorkflowFailedException::class);
+        $result = $run->getResult();
+        $this->fail(sprintf("Workflow must fail. Got result %s", \print_r($result, true)));
+    }
+
+    public function testSignalThatThrowsInternalException()
+    {
+        $client = $this->createClient();
+        $wf = $client->newWorkflowStub(SignalExceptionsWorkflow::class);
+
+        $run = $client->startWithSignal($wf, 'failActivity', ['foo']);
+
+        try {
+            sleep(8);
+            $wf->failActivity('foo');
+            $this->fail('Signal must fail');
+        } catch (AssertionFailedError $e) {
+            throw $e;
+        } catch (\Throwable $e) {
+            $this->assertInstanceOf(WorkflowNotFoundException::class, $e);
+        }
+
+        $this->expectException(WorkflowFailedException::class);
+        $result = $run->getResult();
+        $this->fail(sprintf("Workflow must fail. Got result %s", \print_r($result, true)));
+    }
 }
diff --git a/tests/Functional/Client/UntypedWorkflowStubTestCase.php b/tests/Functional/Client/UntypedWorkflowStubTestCase.php
index b2a90245..8822f1fa 100644
--- a/tests/Functional/Client/UntypedWorkflowStubTestCase.php
+++ b/tests/Functional/Client/UntypedWorkflowStubTestCase.php
@@ -38,6 +38,16 @@ public function testUntypedStartAndWaitResult()
         $this->assertSame('HELLO WORLD', $simple->getResult());
     }
 
+    public function testUntypedStartWithWrongData()
+    {
+        $client = $this->createClient();
+        $simple = $client->newUntypedWorkflowStub('SimpleWorkflow');
+        $client->start($simple, ['hello world']);
+
+        $this->expectException(WorkflowFailedException::class);
+        $simple->getResult();
+    }
+
     public function testUntypedStartViaClient()
     {
         $client = $this->createClient();
diff --git a/tests/docker-compose.yaml b/tests/docker-compose.yaml
index dbd68e6e..fd936663 100644
--- a/tests/docker-compose.yaml
+++ b/tests/docker-compose.yaml
@@ -6,7 +6,7 @@ services:
     ports:
       - "9042:9042"
   temporal:
-    image: temporalio/auto-setup:1.16.2
+    image: temporalio/auto-setup:1.21.1.0
     ports:
       - "7233:7233"
     volumes:
@@ -17,7 +17,7 @@ services:
     depends_on:
       - cassandra
   temporal-admin-tools:
-    image: temporalio/admin-tools:1.16.2
+    image: temporalio/admin-tools:1.21.1.0
     stdin_open: true
     tty: true
     environment:
@@ -25,7 +25,7 @@ services:
     depends_on:
       - temporal
   temporal-ui:
-    image: temporalio/ui:2.5.0
+    image: temporalio/ui:2.16.2
     environment:
       - TEMPORAL_ADDRESS=temporal:7233
       - TEMPORAL_CORS_ORIGINS=http://localhost:3000