diff --git a/frontend/src/pages/Admin/Agents/SQLConnectorSelection/NewConnectionModal.jsx b/frontend/src/pages/Admin/Agents/SQLConnectorSelection/NewConnectionModal.jsx
index 1d781894ce7..e2a8b313298 100644
--- a/frontend/src/pages/Admin/Agents/SQLConnectorSelection/NewConnectionModal.jsx
+++ b/frontend/src/pages/Admin/Agents/SQLConnectorSelection/NewConnectionModal.jsx
@@ -11,6 +11,7 @@ function assembleConnectionString({
   host = "",
   port = "",
   database = "",
+  encrypt = false,
 }) {
   if ([username, password, host, database].every((i) => !!i) === false)
     return `Please fill out all the fields above.`;
@@ -20,7 +21,7 @@ function assembleConnectionString({
     case "mysql":
       return `mysql://${username}:${password}@${host}:${port}/${database}`;
     case "sql-server":
-      return `mssql://${username}:${password}@${host}:${port}/${database}`;
+      return `mssql://${username}:${password}@${host}:${port}/${database}?encrypt=${encrypt}`;
     default:
       return null;
   }
@@ -33,6 +34,7 @@ const DEFAULT_CONFIG = {
   host: null,
   port: null,
   database: null,
+  encrypt: false,
 };
 
 export default function NewSQLConnection({ isOpen, closeModal, onSubmit }) {
@@ -54,6 +56,7 @@ export default function NewSQLConnection({ isOpen, closeModal, onSubmit }) {
       host: form.get("host").trim(),
       port: form.get("port").trim(),
       database: form.get("database").trim(),
+      encrypt: form.get("encrypt") === "true",
     });
   }
 
@@ -226,6 +229,26 @@ export default function NewSQLConnection({ isOpen, closeModal, onSubmit }) {
                     spellCheck={false}
                   />
                 </div>
+
+                {engine === "sql-server" && (
+                  <div className="flex items-center justify-between">
+                    <label className="relative inline-flex items-center cursor-pointer">
+                      <input
+                        type="checkbox"
+                        name="encrypt"
+                        value="true"
+                        className="sr-only peer"
+                        onChange={onFormChange}
+                        checked={config.encrypt}
+                      />
+                      <div className="w-11 h-6 bg-theme-settings-input-bg peer-focus:outline-none peer-focus:ring-4 peer-focus:ring-blue-800 rounded-full peer peer-checked:after:translate-x-full peer-checked:after:border-white after:content-[''] after:absolute after:top-[2px] after:left-[2px] after:bg-white after:border-gray-300 after:border after:rounded-full after:h-5 after:w-5 after:transition-all peer-checked:bg-blue-600"></div>
+                      <span className="ml-3 text-sm font-medium text-white">
+                        Enable Encryption
+                      </span>
+                    </label>
+                  </div>
+                )}
+
                 <p className="text-theme-text-secondary text-sm">
                   {assembleConnectionString({ engine, ...config })}
                 </p>
diff --git a/server/__tests__/utils/SQLConnectors/connectionParser.test.js b/server/__tests__/utils/SQLConnectors/connectionParser.test.js
new file mode 100644
index 00000000000..b984391ddf0
--- /dev/null
+++ b/server/__tests__/utils/SQLConnectors/connectionParser.test.js
@@ -0,0 +1,178 @@
+/* eslint-env jest */
+const { ConnectionStringParser } = require("../../../utils/agents/aibitat/plugins/sql-agent/SQLConnectors/utils");
+
+describe("ConnectionStringParser", () => {
+  describe("Basic Parsing", () => {
+    test("should parse a basic connection string without options", () => {
+      const parser = new ConnectionStringParser({ scheme: "mssql" });
+      const result = parser.parse("mssql://user:pass@localhost:1433/mydb");
+
+      expect(result).toEqual({
+        scheme: "mssql",
+        username: "user",
+        password: "pass",
+        hosts: [{ host: "localhost", port: 1433 }],
+        endpoint: "mydb",
+        options: undefined
+      });
+    });
+
+    test("should parse a connection string with options", () => {
+      const parser = new ConnectionStringParser({ scheme: "mssql" });
+      const result = parser.parse("mssql://user:pass@localhost:1433/mydb?encrypt=true&trustServerCertificate=true");
+
+      expect(result).toEqual({
+        scheme: "mssql",
+        username: "user",
+        password: "pass",
+        hosts: [{ host: "localhost", port: 1433 }],
+        endpoint: "mydb",
+        options: {
+          encrypt: "true",
+          trustServerCertificate: "true"
+        }
+      });
+    });
+
+    test("should handle empty passwords", () => {
+      const parser = new ConnectionStringParser({ scheme: "mssql" });
+      const result = parser.parse("mssql://user@localhost:1433/mydb");
+
+      expect(result).toEqual({
+        scheme: "mssql",
+        username: "user",
+        password: undefined,
+        hosts: [{ host: "localhost", port: 1433 }],
+        endpoint: "mydb",
+        options: undefined
+      });
+    });
+  });
+
+  describe("Error Handling", () => {
+    test("should throw error for invalid scheme", () => {
+      const parser = new ConnectionStringParser({ scheme: "mssql" });
+      expect(() => parser.parse("mysql://user:pass@localhost:3306/mydb"))
+        .toThrow("URI must start with 'mssql://'");
+    });
+
+    test("should throw error for missing scheme", () => {
+      const parser = new ConnectionStringParser({ scheme: "mssql" });
+      expect(() => parser.parse("user:pass@localhost:1433/mydb"))
+        .toThrow("No scheme found in URI");
+    });
+  });
+
+  describe("Special Characters", () => {
+    test("should handle special characters in username and password", () => {
+      const parser = new ConnectionStringParser({ scheme: "mssql" });
+      const result = parser.parse("mssql://user%40domain:p%40ssw%3Ard@localhost:1433/mydb");
+
+      expect(result).toEqual({
+        scheme: "mssql",
+        username: "user@domain",
+        password: "p@ssw:rd",
+        hosts: [{ host: "localhost", port: 1433 }],
+        endpoint: "mydb",
+        options: undefined
+      });
+    });
+
+    test("should handle special characters in database name", () => {
+      const parser = new ConnectionStringParser({ scheme: "mssql" });
+      const result = parser.parse("mssql://user:pass@localhost:1433/my%20db");
+
+      expect(result).toEqual({
+        scheme: "mssql",
+        username: "user",
+        password: "pass",
+        hosts: [{ host: "localhost", port: 1433 }],
+        endpoint: "my db",
+        options: undefined
+      });
+    });
+  });
+
+  describe("Multiple Hosts", () => {
+    test("should parse multiple hosts", () => {
+      const parser = new ConnectionStringParser({ scheme: "mssql" });
+      const result = parser.parse("mssql://user:pass@host1:1433,host2:1434/mydb");
+
+      expect(result).toEqual({
+        scheme: "mssql",
+        username: "user",
+        password: "pass",
+        hosts: [
+          { host: "host1", port: 1433 },
+          { host: "host2", port: 1434 }
+        ],
+        endpoint: "mydb",
+        options: undefined
+      });
+    });
+
+    test("should handle hosts without ports", () => {
+      const parser = new ConnectionStringParser({ scheme: "mssql" });
+      const result = parser.parse("mssql://user:pass@host1,host2/mydb");
+
+      expect(result).toEqual({
+        scheme: "mssql",
+        username: "user",
+        password: "pass",
+        hosts: [
+          { host: "host1" },
+          { host: "host2" }
+        ],
+        endpoint: "mydb",
+        options: undefined
+      });
+    });
+  });
+
+  describe("Provider-Specific Tests", () => {
+    test("should parse MySQL connection string", () => {
+      const parser = new ConnectionStringParser({ scheme: "mysql" });
+      const result = parser.parse("mysql://user:pass@localhost:3306/mydb?ssl=true");
+
+      expect(result).toEqual({
+        scheme: "mysql",
+        username: "user",
+        password: "pass",
+        hosts: [{ host: "localhost", port: 3306 }],
+        endpoint: "mydb",
+        options: { ssl: "true" }
+      });
+    });
+
+    test("should parse PostgreSQL connection string", () => {
+      const parser = new ConnectionStringParser({ scheme: "postgresql" });
+      const result = parser.parse("postgresql://user:pass@localhost:5432/mydb?sslmode=require");
+
+      expect(result).toEqual({
+        scheme: "postgresql",
+        username: "user",
+        password: "pass",
+        hosts: [{ host: "localhost", port: 5432 }],
+        endpoint: "mydb",
+        options: { sslmode: "require" }
+      });
+    });
+
+    test("should parse MSSQL connection string with encryption options", () => {
+      const parser = new ConnectionStringParser({ scheme: "mssql" });
+      const result = parser.parse("mssql://user:pass@localhost:1433/mydb?encrypt=true&trustServerCertificate=true");
+
+      expect(result).toEqual({
+        scheme: "mssql",
+        username: "user",
+        password: "pass",
+        hosts: [{ host: "localhost", port: 1433 }],
+        endpoint: "mydb",
+        options: {
+          encrypt: "true",
+          trustServerCertificate: "true"
+        }
+      });
+    });
+  });
+});
\ No newline at end of file
diff --git a/server/utils/agents/aibitat/plugins/sql-agent/SQLConnectors/MSSQL.js b/server/utils/agents/aibitat/plugins/sql-agent/SQLConnectors/MSSQL.js
index 153c8c77015..46a88234db6 100644
--- a/server/utils/agents/aibitat/plugins/sql-agent/SQLConnectors/MSSQL.js
+++ b/server/utils/agents/aibitat/plugins/sql-agent/SQLConnectors/MSSQL.js
@@ -45,6 +45,10 @@ class MSSQLConnector {
       database: parsed?.endpoint,
       server: parsed?.hosts?.[0]?.host,
       port: parsed?.hosts?.[0]?.port,
+      options: {
+        ...this.connectionConfig.options,
+        encrypt: parsed?.options?.encrypt === "true",
+      },
     };
   }