diff --git a/setup/so-functions b/setup/so-functions
index 5ce9a8fdc..2d5181dc1 100755
--- a/setup/so-functions
+++ b/setup/so-functions
@@ -980,6 +980,8 @@ docker_seed_registry() {
 		docker_seed_update_percent=25
 
 		update_docker_containers 'netinstall' '' 'docker_seed_update' '/dev/stdout' 2>&1 | tee -a "$setup_log"
+        # Use pipe exit status of 'update_docker_containers' for return code
+		return ${PIPESTATUS[0]}
 	fi
 }
 
diff --git a/setup/so-setup b/setup/so-setup
index c11d287eb..72cd555d6 100755
--- a/setup/so-setup
+++ b/setup/so-setup
@@ -767,7 +767,10 @@ if ! [[ -f $install_opt_file ]]; then
 		title "Applying the registry state"
 		logCmd "salt-call state.apply -l info registry"
 		title "Seeding the docker registry"
-		docker_seed_registry
+		if ! docker_seed_registry; then
+			error "Failed to seed the docker registry"
+			fail_setup
+		fi
 		title "Applying the manager state"
 		logCmd "salt-call state.apply -l info manager"
 		logCmd "salt-call state.apply influxdb -l info"