Check your address book entries, find the incorrect email address and correct it. You'll have to check all address books, including Collected Addresses.

Thanks. But, correcting address is not in my control. The exclamation mark (!) is part of the email address of the recipient. I cannot change it.

At the most I can remove the quote marks ("") added by TB. I tried removing them, but doesn't help.

Quote marks indicate an unneeded space in the address.

So then what exactly is in your address book, and to what does Thunderbird 'reformat' it?

This is not about address book. Scenario is like this:

I receive an email from !xyz@abc.com, when I reply to this email, the address in the TO field is changed by TB to "!xyz"@abc.com'. If I press Send button, mail is not delivered and I receive the "Delivery failed" message (as quoted in my first post).

If I manually remove the automatically added quote marks before pressing the Send button, I still get the "Delivery failed" message with exactly the same message. It seems TB adds quote marks before sending even if I removed them manually.

@Airmail - I know about extra space issue, but in this case there is no extra space in email address. I suspect that presence of '!' in email address may be a reason. When I use MS Outlook to receive the same mail and reply, then the mail is delivered without any problem.

a ! is a valid character for the local part of an email address, I think the best approach would be to log the send and see exactly what is and is not being sent.

https://wiki.mozilla.org/MailNews:Logging

Then we can file a bug ( Ican not see anything either current or historical) or complain to the appropriate parties. Without the log we are guessing what is happening.

In addition I'd suggest to verify the email address with the recipient. Having a '!' as the first character in an email address is unusual at least.