diff --git a/acceptance/bundle/apps/app_yaml/app/app.py b/acceptance/bundle/apps/app_yaml/app/app.py
new file mode 100644
index 000000000..e69de29bb
diff --git a/acceptance/bundle/apps/app_yaml/app/app.yml b/acceptance/bundle/apps/app_yaml/app/app.yml
new file mode 100644
index 000000000..61471358d
--- /dev/null
+++ b/acceptance/bundle/apps/app_yaml/app/app.yml
@@ -0,0 +1,3 @@
+command:
+  - python
+  - app.py
diff --git a/acceptance/bundle/apps/app_yaml/databricks.yml b/acceptance/bundle/apps/app_yaml/databricks.yml
new file mode 100644
index 000000000..0064e6c6b
--- /dev/null
+++ b/acceptance/bundle/apps/app_yaml/databricks.yml
@@ -0,0 +1,8 @@
+bundle:
+  name: apps_yaml
+
+resources:
+  apps:
+    myapp:
+      name: myapp
+      source_code_path: ./app
diff --git a/acceptance/bundle/apps/app_yaml/out.app.yml.txt b/acceptance/bundle/apps/app_yaml/out.app.yml.txt
new file mode 100644
index 000000000..eccd4eb13
--- /dev/null
+++ b/acceptance/bundle/apps/app_yaml/out.app.yml.txt
@@ -0,0 +1,5 @@
+{
+  "method": "POST",
+  "path": "/api/2.0/workspace-files/import-file/Workspace/Users/[USERNAME]/.bundle/apps_yaml/default/files/app/app.yml",
+  "raw_body": "command:\n  - python\n  - app.py\n"
+}
diff --git a/acceptance/bundle/apps/app_yaml/output.txt b/acceptance/bundle/apps/app_yaml/output.txt
new file mode 100644
index 000000000..2a946e5ee
--- /dev/null
+++ b/acceptance/bundle/apps/app_yaml/output.txt
@@ -0,0 +1,15 @@
+
+>>> [CLI] bundle validate
+Name: apps_yaml
+Target: default
+Workspace:
+  User: [USERNAME]
+  Path: /Workspace/Users/[USERNAME]/.bundle/apps_yaml/default
+
+Validation OK!
+
+>>> [CLI] bundle deploy
+Uploading bundle files to /Workspace/Users/[USERNAME]/.bundle/apps_yaml/default/files...
+Deploying resources...
+Updating deployment state...
+Deployment complete!
diff --git a/acceptance/bundle/apps/app_yaml/script b/acceptance/bundle/apps/app_yaml/script
new file mode 100644
index 000000000..8cb34c62d
--- /dev/null
+++ b/acceptance/bundle/apps/app_yaml/script
@@ -0,0 +1,4 @@
+trace $CLI bundle validate
+trace $CLI bundle deploy
+jq 'select(.path == "/api/2.0/workspace-files/import-file/Workspace/Users/[USERNAME]/.bundle/apps_yaml/default/files/app/app.yml")' out.requests.txt | sed 's/\\r//g'  > out.app.yml.txt
+rm out.requests.txt
diff --git a/acceptance/bundle/apps/config_section/app/app.py b/acceptance/bundle/apps/config_section/app/app.py
new file mode 100644
index 000000000..f1a18139c
--- /dev/null
+++ b/acceptance/bundle/apps/config_section/app/app.py
@@ -0,0 +1 @@
+print("Hello world!")
diff --git a/acceptance/bundle/apps/config_section/databricks.yml b/acceptance/bundle/apps/config_section/databricks.yml
new file mode 100644
index 000000000..25ab2f261
--- /dev/null
+++ b/acceptance/bundle/apps/config_section/databricks.yml
@@ -0,0 +1,12 @@
+bundle:
+  name: apps_config_section
+
+resources:
+  apps:
+    myapp:
+      name: myapp
+      source_code_path: ./app
+      config:
+        command:
+          - python
+          - app.py
diff --git a/acceptance/bundle/apps/config_section/out.app.yml.txt b/acceptance/bundle/apps/config_section/out.app.yml.txt
new file mode 100644
index 000000000..a3e69351b
--- /dev/null
+++ b/acceptance/bundle/apps/config_section/out.app.yml.txt
@@ -0,0 +1,5 @@
+{
+  "method": "POST",
+  "path": "/api/2.0/workspace-files/import-file/Workspace/Users/[USERNAME]/.bundle/apps_config_section/default/files/app/app.yml",
+  "raw_body": "command:\n  - python\n  - app.py\n"
+}
diff --git a/acceptance/bundle/apps/config_section/output.txt b/acceptance/bundle/apps/config_section/output.txt
new file mode 100644
index 000000000..800945278
--- /dev/null
+++ b/acceptance/bundle/apps/config_section/output.txt
@@ -0,0 +1,23 @@
+
+>>> [CLI] bundle validate
+Warning: App config section detected
+
+remove 'config' from app resource 'myapp' section and use app.yml file in the root of this app instead
+
+Name: apps_config_section
+Target: default
+Workspace:
+  User: [USERNAME]
+  Path: /Workspace/Users/[USERNAME]/.bundle/apps_config_section/default
+
+Found 1 warning
+
+>>> [CLI] bundle deploy
+Uploading bundle files to /Workspace/Users/[USERNAME]/.bundle/apps_config_section/default/files...
+Deploying resources...
+Updating deployment state...
+Deployment complete!
+Warning: App config section detected
+
+remove 'config' from app resource 'myapp' section and use app.yml file in the root of this app instead
+
diff --git a/acceptance/bundle/apps/config_section/script b/acceptance/bundle/apps/config_section/script
new file mode 100644
index 000000000..5769918be
--- /dev/null
+++ b/acceptance/bundle/apps/config_section/script
@@ -0,0 +1,4 @@
+trace $CLI bundle validate
+trace $CLI bundle deploy
+jq 'select(.path == "/api/2.0/workspace-files/import-file/Workspace/Users/[USERNAME]/.bundle/apps_config_section/default/files/app/app.yml")' out.requests.txt  > out.app.yml.txt
+rm out.requests.txt
diff --git a/acceptance/bundle/apps/test.toml b/acceptance/bundle/apps/test.toml
new file mode 100644
index 000000000..6999f2089
--- /dev/null
+++ b/acceptance/bundle/apps/test.toml
@@ -0,0 +1,26 @@
+Cloud = false
+RecordRequests = true
+
+Ignore = [
+    '.databricks',
+]
+
+[[Server]]
+Pattern = "POST /api/2.0/apps"
+
+[[Server]]
+Pattern = "GET /api/2.0/apps/myapp"
+Response.Body = '''
+{
+  "name": "myapp",
+  "description": "",
+  "compute_status": {
+    "state": "ACTIVE",
+    "message": "App compute is active."
+  },
+  "app_status": {
+    "state": "RUNNING",
+    "message": "Application is running."
+  }
+}
+'''
diff --git a/bundle/apps/validate.go b/bundle/apps/validate.go
index fc50aeafc..7a4fe7126 100644
--- a/bundle/apps/validate.go
+++ b/bundle/apps/validate.go
@@ -3,8 +3,6 @@ package apps
 import (
 	"context"
 	"fmt"
-	"path"
-	"strings"
 
 	"github.com/databricks/cli/bundle"
 	"github.com/databricks/cli/libs/diag"
@@ -14,7 +12,6 @@ type validate struct{}
 
 func (v *validate) Apply(ctx context.Context, b *bundle.Bundle) diag.Diagnostics {
 	var diags diag.Diagnostics
-	possibleConfigFiles := []string{"app.yml", "app.yaml"}
 	usedSourceCodePaths := make(map[string]string)
 
 	for key, app := range b.Config.Resources.Apps {
@@ -28,16 +25,12 @@ func (v *validate) Apply(ctx context.Context, b *bundle.Bundle) diag.Diagnostics
 		}
 		usedSourceCodePaths[app.SourceCodePath] = key
 
-		for _, configFile := range possibleConfigFiles {
-			appPath := strings.TrimPrefix(app.SourceCodePath, b.Config.Workspace.FilePath)
-			cf := path.Join(appPath, configFile)
-			if _, err := b.SyncRoot.Stat(cf); err == nil {
-				diags = append(diags, diag.Diagnostic{
-					Severity: diag.Error,
-					Summary:  configFile + " detected",
-					Detail:   fmt.Sprintf("remove %s and use 'config' property for app resource '%s' instead", cf, app.Name),
-				})
-			}
+		if app.Config != nil {
+			diags = append(diags, diag.Diagnostic{
+				Severity: diag.Warning,
+				Summary:  "App config section detected",
+				Detail:   fmt.Sprintf("remove 'config' from app resource '%s' section and use app.yml file in the root of this app instead", key),
+			})
 		}
 	}
 
diff --git a/bundle/apps/validate_test.go b/bundle/apps/validate_test.go
index 11270198e..d218f96ca 100644
--- a/bundle/apps/validate_test.go
+++ b/bundle/apps/validate_test.go
@@ -17,46 +17,6 @@ import (
 	"github.com/stretchr/testify/require"
 )
 
-func TestAppsValidate(t *testing.T) {
-	tmpDir := t.TempDir()
-	testutil.Touch(t, tmpDir, "app1", "app.yml")
-	testutil.Touch(t, tmpDir, "app2", "app.py")
-
-	b := &bundle.Bundle{
-		BundleRootPath: tmpDir,
-		SyncRootPath:   tmpDir,
-		SyncRoot:       vfs.MustNew(tmpDir),
-		Config: config.Root{
-			Workspace: config.Workspace{
-				FilePath: "/foo/bar/",
-			},
-			Resources: config.Resources{
-				Apps: map[string]*resources.App{
-					"app1": {
-						App: &apps.App{
-							Name: "app1",
-						},
-						SourceCodePath: "./app1",
-					},
-					"app2": {
-						App: &apps.App{
-							Name: "app2",
-						},
-						SourceCodePath: "./app2",
-					},
-				},
-			},
-		},
-	}
-
-	bundletest.SetLocation(b, ".", []dyn.Location{{File: filepath.Join(tmpDir, "databricks.yml")}})
-
-	diags := bundle.ApplySeq(context.Background(), b, mutator.TranslatePaths(), Validate())
-	require.Len(t, diags, 1)
-	require.Equal(t, "app.yml detected", diags[0].Summary)
-	require.Contains(t, diags[0].Detail, "app.yml and use 'config' property for app resource")
-}
-
 func TestAppsValidateSameSourcePath(t *testing.T) {
 	tmpDir := t.TempDir()
 	testutil.Touch(t, tmpDir, "app1", "app.py")
diff --git a/integration/bundle/testdata/apps/bundle_deploy.txt b/integration/bundle/testdata/apps/bundle_deploy.txt
index 437a55596..55b8dedc6 100644
--- a/integration/bundle/testdata/apps/bundle_deploy.txt
+++ b/integration/bundle/testdata/apps/bundle_deploy.txt
@@ -2,3 +2,7 @@ Uploading bundle files to /Workspace/Users/[USERNAME]/.bundle/$UNIQUE_PRJ/files.
 Deploying resources...
 Updating deployment state...
 Deployment complete!
+Warning: App config section detected
+
+remove 'config' from app resource 'test_app' section and use app.yml file in the root of this app instead
+
diff --git a/integration/bundle/testdata/apps/bundle_validate.txt b/integration/bundle/testdata/apps/bundle_validate.txt
index 567fafd24..cb37fc4bd 100644
--- a/integration/bundle/testdata/apps/bundle_validate.txt
+++ b/integration/bundle/testdata/apps/bundle_validate.txt
@@ -1,7 +1,11 @@
+Warning: App config section detected
+
+remove 'config' from app resource 'test_app' section and use app.yml file in the root of this app instead
+
 Name: basic
 Target: default
 Workspace:
   User: [USERNAME]
   Path: /Workspace/Users/[USERNAME]/.bundle/$UNIQUE_PRJ
 
-Validation OK!
+Found 1 warning