I have an yaml file as given below

sites:
  - name: site1
    counter: "001"
    keyvaults:
      - name: "KV1"
        role_id: "0023"
        access_policies:
          SP1:
            object_id: "0000-0000-0000-00000"
            tenant_id: "xxxx-xxxx-xxxx-xxxx"
            certificate_permissions: ["Get"]
            key_permissions: []
            storage_permissions: []
            secret_permissions: ["Get"]

But terraform code for reading this is

locals {
  sites = yamldecode(file("${path.module}/sites.yaml"))["sites"]
  keyvaults = merge(flatten([
     for site in local.sites : {
      for keyvault in site.keyvaults : "${site.name}-${keyvault.name}" => {
        keyvault_name                 = keyvault.name
        keyvault_role_id              = keyvault.role_id
        counter                       = site.counter
        access_policies               = keyvault.access_policies
    }
   }
  ])...)
}

But , when i execute "terraform plan" it is failing saying:

Error: Unsupported attribute
│ 
│   on appservice_env.tf line 66, in locals:
│   66:           for policy_name, policy in tomap(keyvault.access_policies) : 
policy_name => {
│ 
│ This object does not have an attribute named "access_policies".

TL;DR your problem is probably caused by elements in your yaml file that don't have an access_policies property.

Instead of:

for policy_name, policy in keyvault.access_policies

Try:

for policy_name, policy in try(keyvault.access_policies, [])

Example

Consider the following file - sites.yaml:

sites:
  - name: site1
    counter: "001"
    keyvaults:
      - name: "KV1"
        role_id: "0023"
        access_policies:
          SP1:
            object_id: "0000-0000-0000-00000"
            tenant_id: "xxxx-xxxx-xxxx-xxxx"
            certificate_permissions: ["Get"]
            key_permissions: []
            storage_permissions: []
            secret_permissions: ["Get"]
  - name: site2
    counter: "002"
    keyvaults:
      - name: "KV2"
        role_id: "0024"

Reproducing the issue

Adding an output variable to your original code:

locals {
  sites = yamldecode(file("${path.module}/sites.yaml"))["sites"]

  keyvaults = merge(flatten([
    for site in local.sites : {
      for keyvault in site.keyvaults : "${site.name}-${keyvault.name}" => {
        keyvault_name    = keyvault.name
        keyvault_role_id = keyvault.role_id
        counter          = site.counter
        access_policies = {
          for policy_name, policy in keyvault.access_policies : policy_name => {
            tenant_id               = policy.tenant_id
            object_id               = policy.object_id
            key_permissions         = policy.key_permissions
            secret_permissions      = policy.secret_permissions
            certificate_permissions = policy.certificate_permissions
            storage_permissions     = policy.storage_permissions
          }
        }
      }
    }
  ])...)
}

output "keyvaults" {
  value = local.keyvaults
}

Output of terraform plan:

Error: Unsupported attribute

  on main.tf line 11, in locals:
  11:           for policy_name, policy in keyvault.access_policies : policy_name => {

This object does not have an attribute named "access_policies".

Fixing the code

locals {
  sites = yamldecode(file("${path.module}/sites.yaml"))["sites"]

  keyvaults = merge(flatten([
    for site in local.sites : {
      for keyvault in site.keyvaults : "${site.name}-${keyvault.name}" => {
        keyvault_name    = keyvault.name
        keyvault_role_id = keyvault.role_id
        counter          = site.counter
        access_policies = {
          for policy_name, policy in try(keyvault.access_policies, []) : policy_name => {
            tenant_id               = policy.tenant_id
            object_id               = policy.object_id
            key_permissions         = policy.key_permissions
            secret_permissions      = policy.secret_permissions
            certificate_permissions = policy.certificate_permissions
            storage_permissions     = policy.storage_permissions
          }
        }
      }
    }
  ])...)
}

output "keyvaults" {
  value = local.keyvaults
}

Output of terraform plan:

Changes to Outputs:
  + keyvaults = {
      + site1-KV1 = {
          + access_policies  = {
              + SP1 = {
                  + certificate_permissions = [
                      + "Get",
                    ]
                  + key_permissions         = []
                  + object_id               = "0000-0000-0000-00000"
                  + secret_permissions      = [
                      + "Get",
                    ]
                  + storage_permissions     = []
                  + tenant_id               = "xxxx-xxxx-xxxx-xxxx"
                }
            }
          + counter          = "001"
          + keyvault_name    = "KV1"
          + keyvault_role_id = "0023"
        }
      + site2-KV2 = {
          + access_policies  = {}
          + counter          = "002"
          + keyvault_name    = "KV2"
          + keyvault_role_id = "0024"
        }
    }