diff --git a/packages/traceloop-sdk/traceloop/sdk/decorators/base.py b/packages/traceloop-sdk/traceloop/sdk/decorators/base.py
index ab7f401e43..140a973ad5 100644
--- a/packages/traceloop-sdk/traceloop/sdk/decorators/base.py
+++ b/packages/traceloop-sdk/traceloop/sdk/decorators/base.py
@@ -172,12 +172,79 @@ def _setup_span(entity_name, tlp_span_kind, version):
     return span, ctx, ctx_token
 
 
+def _sanitize_for_serialization(obj):
+    """
+    Recursively sanitize objects for JSON serialization by replacing
+    unpicklable objects with string representations.
+    """
+    import dataclasses
+    import copy
+
+    # Handle None
+    if obj is None:
+        return None
+
+    # Handle primitive types
+    if isinstance(obj, (str, int, float, bool)):
+        return obj
+
+    # Handle lists and tuples
+    if isinstance(obj, (list, tuple)):
+        return type(obj)(
+            _sanitize_for_serialization(item) for item in obj
+        )
+
+    # Handle dictionaries
+    if isinstance(obj, dict):
+        return {
+            key: _sanitize_for_serialization(value)
+            for key, value in obj.items()
+        }
+
+    # Handle dataclasses - try to convert, catch unpicklable objects
+    if dataclasses.is_dataclass(obj):
+        try:
+            # Try shallow copy first to test if it's picklable
+            copy.copy(obj)
+            # If successful, try to convert to dict
+            obj_dict = {}
+            for field in dataclasses.fields(obj):
+                field_value = getattr(obj, field.name)
+                # Check if the field value is picklable
+                try:
+                    copy.deepcopy(field_value)
+                    obj_dict[field.name] = _sanitize_for_serialization(
+                        field_value
+                    )
+                except (TypeError, ValueError, AttributeError):
+                    # If not picklable, use string representation
+                    obj_dict[field.name] = (
+                        f"<unpicklable: {type(field_value).__name__}>"
+                    )
+            return obj_dict
+        except (TypeError, ValueError, AttributeError):
+            return f"<unpicklable dataclass: {type(obj).__name__}>"
+
+    # For other objects, try to serialize them
+    try:
+        copy.deepcopy(obj)
+        # If deepcopy succeeds, return as-is for JSON encoder
+        return obj
+    except (TypeError, ValueError, AttributeError):
+        # If not picklable, return a string representation
+        return f"<unpicklable: {type(obj).__name__}>"
+
+
 def _handle_span_input(span, args, kwargs, cls=None):
     """Handles entity input logging in JSON for both sync and async functions"""
     try:
         if _should_send_prompts():
+
+            # Create a sanitized copy of args and kwargs that excludes unpicklable objects
+            sanitized_args = _sanitize_for_serialization(args)
+            sanitized_kwargs = _sanitize_for_serialization(kwargs)
             json_input = json.dumps(
-                {"args": args, "kwargs": kwargs}, **({"cls": cls} if cls else {})
+                {"args": sanitized_args, "kwargs": sanitized_kwargs}, **({"cls": cls} if cls else {})
             )
             truncated_json = _truncate_json_if_needed(json_input)
             span.set_attribute(
@@ -192,13 +259,14 @@ def _handle_span_output(span, res, cls=None):
     """Handles entity output logging in JSON for both sync and async functions"""
     try:
         if _should_send_prompts():
-            json_output = json.dumps(res, **({"cls": cls} if cls else {}))
+            sanitized_res = _sanitize_for_serialization(res)
+            json_output = json.dumps(sanitized_res, **({"cls": cls} if cls else {}))
             truncated_json = _truncate_json_if_needed(json_output)
             span.set_attribute(
                 SpanAttributes.TRACELOOP_ENTITY_OUTPUT,
                 truncated_json,
             )
-    except TypeError as e:
+    except (TypeError, ValueError) as e:
         Telemetry().log_exception(e)