diff --git a/changelog.d/9587.bugfix b/changelog.d/9587.bugfix
new file mode 100644
index 0000000000..d8f04c4f21
--- /dev/null
+++ b/changelog.d/9587.bugfix
@@ -0,0 +1 @@
+Re-Activating account with admin API when local passwords are disabled.
\ No newline at end of file
diff --git a/synapse/rest/admin/users.py b/synapse/rest/admin/users.py
index 267a993430..2c89b62e25 100644
--- a/synapse/rest/admin/users.py
+++ b/synapse/rest/admin/users.py
@@ -269,7 +269,10 @@ class UserRestServletV2(RestServlet):
                         target_user.to_string(), False, requester, by_admin=True
                     )
                 elif not deactivate and user["deactivated"]:
-                    if "password" not in body:
+                    if (
+                        "password" not in body
+                        and self.hs.config.password_localdb_enabled
+                    ):
                         raise SynapseError(
                             400, "Must provide a password to re-activate an account."
                         )