diff --git a/tests/tools/test_mcp_list_pagination.py b/tests/tools/test_mcp_list_pagination.py
index 6214646896..da8b001549 100644
--- a/tests/tools/test_mcp_list_pagination.py
+++ b/tests/tools/test_mcp_list_pagination.py
@@ -7,6 +7,8 @@ past page 1. Port of the invariant behind anomalyco/opencode#35439/#35500.
 """
 
 import asyncio
+
+import pytest
 from types import SimpleNamespace
 from unittest.mock import AsyncMock, MagicMock
 
@@ -68,3 +70,38 @@ class TestDiscoveryUsesPagination:
 
         asyncio.run(server._discover_tools())
         assert [t.name for t in server._tools] == ["first", "second"]
+
+
+class TestTypeErrorPropagation:
+    """#104150: a TypeError raised INSIDE the list call (e.g. a server
+    response decode failure) must propagate — it must not be caught by the
+    mcp-2.0/1.x calling-convention fallback and replaced by a misleading
+    'unexpected keyword argument cursor' error."""
+
+    def test_type_error_from_modern_list_call_propagates(self):
+        calls = {"n": 0}
+
+        async def broken_list(**kwargs):
+            calls["n"] += 1
+            if calls["n"] == 1:
+                return SimpleNamespace(tools=[_tool("first")], nextCursor="page-2")
+            raise TypeError("server response decode failed")
+
+        with pytest.raises(TypeError, match="server response decode failed"):
+            asyncio.run(_paginate_full_list(broken_list, "tools", "srv"))
+
+        assert calls["n"] == 2, "the legacy-cursor retry must not run"
+
+    def test_legacy_signature_still_uses_cursor_fallback(self):
+        """A genuinely 1.x-shaped method (no params kwarg) keeps working."""
+        calls = {"n": 0}
+
+        async def legacy_list(cursor=None):
+            calls["n"] += 1
+            if calls["n"] == 1:
+                return SimpleNamespace(tools=[_tool("first")], nextCursor="p2")
+            return SimpleNamespace(tools=[_tool("second")], nextCursor=None)
+
+        items = asyncio.run(_paginate_full_list(legacy_list, "tools", "srv"))
+        assert [t.name for t in items] == ["first", "second"]
+        assert calls["n"] == 2
diff --git a/tools/mcp_tool.py b/tools/mcp_tool.py
index f4fb25884f..436eaad027 100644
--- a/tools/mcp_tool.py
+++ b/tools/mcp_tool.py
@@ -252,6 +252,26 @@ _JSONRPC_METHOD_NOT_FOUND = -32601
 _MCP_LIST_MAX_PAGES = 50
 
 
+def _list_method_accepts_params(list_method) -> bool:
+    """True when *list_method* accepts the mcp 2.0 ``params=`` keyword.
+
+    Probing the signature instead of catching TypeError around the call keeps
+    a TypeError raised INSIDE the list call — e.g. a server response decode
+    failure — propagating, rather than being replaced by a misleading
+    legacy-cursor retry error (#104150).
+    """
+    import inspect
+
+    try:
+        sig = inspect.signature(list_method)
+    except (TypeError, ValueError):
+        return True  # can't introspect — assume the modern convention
+    return any(
+        param.name == "params" or param.kind == inspect.Parameter.VAR_KEYWORD
+        for param in sig.parameters.values()
+    )
+
+
 async def _paginate_full_list(list_method, items_attr: str, server_name: str,
                               cache_meta_out: Optional[dict] = None):
     """Drain a paginated ``list_*`` call by following ``nextCursor``; ``cache_meta_out`` gets the
@@ -263,12 +283,17 @@ async def _paginate_full_list(list_method, items_attr: str, server_name: str,
             result = await list_method()
         else:
             # mcp 2.0 takes params=PaginatedRequestParams, 1.x takes cursor=.
-            try:
+            # Signature-probed (see _list_method_accepts_params) instead of
+            # try/except TypeError: a TypeError from inside the list call
+            # must propagate, not trigger the legacy fallback (#104150).
+            if _list_method_accepts_params(list_method):
                 import mcp.types as _types  # late: keeps the SDK import lazy
                 _params_cls = getattr(_types, "PaginatedRequestParams", None)
-                result = await (list_method(params=_params_cls(cursor=cursor)) if _params_cls is not None
-                                else list_method(cursor=cursor))
-            except TypeError:
+                if _params_cls is not None:
+                    result = await list_method(params=_params_cls(cursor=cursor))
+                else:
+                    result = await list_method(cursor=cursor)
+            else:
                 result = await list_method(cursor=cursor)
         if cache_meta_out is not None and not items:
             for key, snake, camel in (("ttl_ms", "ttl_ms", "ttlMs"), ("cache_scope", "cache_scope", "cacheScope")):