Long story short, I failed one of three modules of a Masters program in Theoretical Particle Physics at a prestigious European department. The program comprises two taught modules and a project/dissertation module (30 credits each). I barely passed the first taught module (after a resit), failed the second taught module and received a top grade in the dissertation - which I did under a famous researcher. As a result, I received a Postgraduate Diploma (60 credits as opposed to 90 for a Masters). [edit: actually, I have a choice to claim the diploma or leave the program without a qualification] My original plan to apply to PhD programs after completing the Masters does not seem viable now. But I am not abandoning the dream of doing a PhD in hep-theory just yet. I believe the best way to go forward is to do another Masters, this time a research-based one. My question to you is: how will the Postgraduate Diploma look to admissions committees? Is it a net positive? I have no idea whether it is something that can be shown in a good light: 60 credits imply 1200 hours of graduate study and I learned a great deal during that time. On the other hand, HEP-theory is such a competitive area that often a near-perfect record is required. And failing classes is just bad, no matter how you look at it. The question is important because many Masters programs, including my top choice, do not require listing all periods of previous study. I think I would have a strong chance of getting in on the merits of my undergraduate degree alone.