--- a/net/minecraft/world/item/BlockItem.java
+++ b/net/minecraft/world/item/BlockItem.java
@@ -10,9 +10,9 @@
 import net.minecraft.core.registries.Registries;
 import net.minecraft.nbt.CompoundTag;
 import net.minecraft.network.chat.Component;
+import net.minecraft.server.level.ServerLevel;
 import net.minecraft.server.level.ServerPlayer;
 import net.minecraft.sounds.SoundEvent;
-import net.minecraft.sounds.SoundSource;
 import net.minecraft.world.InteractionResult;
 import net.minecraft.world.entity.item.ItemEntity;
 import net.minecraft.world.entity.player.Player;
@@ -31,6 +31,10 @@
 import net.minecraft.world.level.block.state.BlockState;
 import net.minecraft.world.level.gameevent.GameEvent;
 import net.minecraft.world.phys.shapes.CollisionContext;
+import org.bukkit.craftbukkit.block.CraftBlock;
+import org.bukkit.craftbukkit.block.data.CraftBlockData;
+import org.bukkit.event.block.BlockCanBuildEvent;
+// CraftBukkit end
 
 public class BlockItem extends Item {
 
@@ -62,6 +66,13 @@
                 return InteractionResult.FAIL;
             } else {
                 BlockState iblockdata = this.getPlacementState(blockactioncontext1);
+                // CraftBukkit start - special case for handling block placement with water lilies and snow buckets
+                org.bukkit.block.BlockState blockstate = null;
+                if (this instanceof PlaceOnWaterBlockItem || this instanceof SolidBucketItem) {
+                    blockstate = org.bukkit.craftbukkit.block.CraftBlockStates.getBlockState(blockactioncontext1.getLevel(), blockactioncontext1.getClickedPos());
+                }
+                final org.bukkit.block.BlockState oldBlockstate = blockstate != null ? blockstate : org.bukkit.craftbukkit.block.CraftBlockStates.getBlockState(blockactioncontext1.getLevel(), blockactioncontext1.getClickedPos()); // Paper - Reset placed block on exception
+                // CraftBukkit end
 
                 if (iblockdata == null) {
                     return InteractionResult.FAIL;
@@ -76,9 +87,34 @@
 
                     if (iblockdata1.is(iblockdata.getBlock())) {
                         iblockdata1 = this.updateBlockStateFromTag(blockposition, world, itemstack, iblockdata1);
+                        // Paper start - Reset placed block on exception
+                        try {
                         this.updateCustomBlockEntityTag(blockposition, world, entityhuman, itemstack, iblockdata1);
                         BlockItem.updateBlockEntityComponents(world, blockposition, itemstack);
+                        } catch (Exception e) {
+                            oldBlockstate.update(true, false);
+                            if (entityhuman instanceof ServerPlayer player) {
+                                org.apache.logging.log4j.LogManager.getLogger().error("Player {} tried placing invalid block", player.getScoreboardName(), e);
+                                player.getBukkitEntity().kickPlayer("Packet processing error");
+                                return InteractionResult.FAIL;
+                            }
+                            throw e; // Rethrow exception if not placed by a player
+                        }
+                        // Paper end - Reset placed block on exception
                         iblockdata1.getBlock().setPlacedBy(world, blockposition, iblockdata1, entityhuman, itemstack);
+                        // CraftBukkit start
+                        if (blockstate != null) {
+                            org.bukkit.event.block.BlockPlaceEvent placeEvent = org.bukkit.craftbukkit.event.CraftEventFactory.callBlockPlaceEvent((ServerLevel) world, entityhuman, blockactioncontext1.getHand(), blockstate, blockposition.getX(), blockposition.getY(), blockposition.getZ());
+                            if (placeEvent != null && (placeEvent.isCancelled() || !placeEvent.canBuild())) {
+                                blockstate.update(true, false);
+
+                                if (this instanceof SolidBucketItem) {
+                                    ((ServerPlayer) entityhuman).getBukkitEntity().updateInventory(); // SPIGOT-4541
+                                }
+                                return InteractionResult.FAIL;
+                            }
+                        }
+                        // CraftBukkit end
                         if (entityhuman instanceof ServerPlayer) {
                             CriteriaTriggers.PLACED_BLOCK.trigger((ServerPlayer) entityhuman, blockposition, itemstack);
                         }
@@ -86,7 +122,7 @@
 
                     SoundType soundeffecttype = iblockdata1.getSoundType();
 
-                    world.playSound(entityhuman, blockposition, this.getPlaceSound(iblockdata1), SoundSource.BLOCKS, (soundeffecttype.getVolume() + 1.0F) / 2.0F, soundeffecttype.getPitch() * 0.8F);
+                    if (entityhuman == null) world.playSound(entityhuman, blockposition, this.getPlaceSound(iblockdata1), net.minecraft.sounds.SoundSource.BLOCKS, (soundeffecttype.getVolume() + 1.0F) / 2.0F, soundeffecttype.getPitch() * 0.8F); // Paper - Fix block place logic; reintroduce this for the dispenser (i.e the shulker)
                     world.gameEvent((Holder) GameEvent.BLOCK_PLACE, blockposition, GameEvent.Context.of(entityhuman, iblockdata1));
                     itemstack.consume(1, entityhuman);
                     return InteractionResult.SUCCESS;
@@ -144,8 +180,16 @@
     protected boolean canPlace(BlockPlaceContext context, BlockState state) {
         Player entityhuman = context.getPlayer();
         CollisionContext voxelshapecollision = entityhuman == null ? CollisionContext.empty() : CollisionContext.of(entityhuman);
+        // CraftBukkit start - store default return
+        Level world = context.getLevel(); // Paper - Cancel hit for vanished players
+        boolean defaultReturn = (!this.mustSurvive() || state.canSurvive(context.getLevel(), context.getClickedPos())) && world.checkEntityCollision(state, entityhuman, voxelshapecollision, context.getClickedPos(), true); // Paper - Cancel hit for vanished players
+        org.bukkit.entity.Player player = (context.getPlayer() instanceof ServerPlayer) ? (org.bukkit.entity.Player) context.getPlayer().getBukkitEntity() : null;
 
-        return (!this.mustSurvive() || state.canSurvive(context.getLevel(), context.getClickedPos())) && context.getLevel().isUnobstructed(state, context.getClickedPos(), voxelshapecollision);
+        BlockCanBuildEvent event = new BlockCanBuildEvent(CraftBlock.at(context.getLevel(), context.getClickedPos()), player, CraftBlockData.fromData(state), defaultReturn);
+        context.getLevel().getCraftServer().getPluginManager().callEvent(event);
+
+        return event.isBuildable();
+        // CraftBukkit end
     }
 
     protected boolean mustSurvive() {
@@ -178,7 +222,7 @@
                         return false;
                     }
 
-                    if (tileentitytypes1.onlyOpCanSetNbt() && (player == null || !player.canUseGameMasterBlocks())) {
+                    if (tileentitytypes1.onlyOpCanSetNbt() && (player == null || !(player.canUseGameMasterBlocks() || (player.getAbilities().instabuild && player.getBukkitEntity().hasPermission("minecraft.nbt.place"))))) { // Spigot - add permission
                         return false;
                     }