diff --git a/hadoop-yarn-project/CHANGES.txt b/hadoop-yarn-project/CHANGES.txt
index 11a6c6a0fb1..c238462037c 100644
--- a/hadoop-yarn-project/CHANGES.txt
+++ b/hadoop-yarn-project/CHANGES.txt
@@ -295,6 +295,9 @@ Release 2.4.0 - UNRELEASED
     YARN-1560. Fixed TestYarnClient#testAMMRTokens failure with null AMRM token.
     (Ted Yu via jianhe)
 
+    YARN-1409. NonAggregatingLogHandler can throw RejectedExecutionException
+    (Tsuyoshi OZAWA via jlowe)
+
 Release 2.3.0 - UNRELEASED
 
   INCOMPATIBLE CHANGES
diff --git a/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-nodemanager/src/main/java/org/apache/hadoop/yarn/server/nodemanager/containermanager/loghandler/NonAggregatingLogHandler.java b/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-nodemanager/src/main/java/org/apache/hadoop/yarn/server/nodemanager/containermanager/loghandler/NonAggregatingLogHandler.java
index 06b654ae064..a9aacb58c2a 100644
--- a/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-nodemanager/src/main/java/org/apache/hadoop/yarn/server/nodemanager/containermanager/loghandler/NonAggregatingLogHandler.java
+++ b/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-nodemanager/src/main/java/org/apache/hadoop/yarn/server/nodemanager/containermanager/loghandler/NonAggregatingLogHandler.java
@@ -23,6 +23,7 @@
 import java.util.concurrent.ScheduledThreadPoolExecutor;
 import java.util.concurrent.ThreadFactory;
 import java.util.concurrent.TimeUnit;
+import java.util.concurrent.RejectedExecutionException;
 
 import org.apache.commons.logging.Log;
 import org.apache.commons.logging.LogFactory;
@@ -118,10 +119,17 @@ public void handle(LogHandlerEvent event) {
         LOG.info("Scheduling Log Deletion for application: "
             + appFinishedEvent.getApplicationId() + ", with delay of "
             + this.deleteDelaySeconds + " seconds");
-        sched.schedule(
+        LogDeleterRunnable logDeleter =
             new LogDeleterRunnable(appOwners.remove(appFinishedEvent
-                .getApplicationId()), appFinishedEvent.getApplicationId()),
-            this.deleteDelaySeconds, TimeUnit.SECONDS);
+                  .getApplicationId()), appFinishedEvent.getApplicationId());
+        try {
+          sched.schedule(logDeleter, this.deleteDelaySeconds,
+              TimeUnit.SECONDS);
+        } catch (RejectedExecutionException e) {
+          // Handling this event in local thread before starting threads
+          // or after calling sched.shutdownNow().
+          logDeleter.run();
+        }
         break;
       default:
         ; // Ignore
diff --git a/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-nodemanager/src/test/java/org/apache/hadoop/yarn/server/nodemanager/containermanager/loghandler/TestNonAggregatingLogHandler.java b/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-nodemanager/src/test/java/org/apache/hadoop/yarn/server/nodemanager/containermanager/loghandler/TestNonAggregatingLogHandler.java
index e31ee007ca4..298157bcd4a 100644
--- a/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-nodemanager/src/test/java/org/apache/hadoop/yarn/server/nodemanager/containermanager/loghandler/TestNonAggregatingLogHandler.java
+++ b/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-nodemanager/src/test/java/org/apache/hadoop/yarn/server/nodemanager/containermanager/loghandler/TestNonAggregatingLogHandler.java
@@ -35,6 +35,7 @@
 import org.apache.hadoop.yarn.event.Dispatcher;
 import org.apache.hadoop.yarn.event.DrainDispatcher;
 import org.apache.hadoop.yarn.event.EventHandler;
+import org.apache.hadoop.yarn.event.InlineDispatcher;
 import org.apache.hadoop.yarn.logaggregation.ContainerLogsRetentionPolicy;
 import org.apache.hadoop.yarn.server.nodemanager.DeletionService;
 import org.apache.hadoop.yarn.server.nodemanager.LocalDirsHandlerService;
@@ -202,6 +203,32 @@ public void testStop() throws Exception {
     verify(logHandler.mockSched).shutdownNow();
   }
 
+  @Test
+  public void testHandlingApplicationFinishedEvent() {
+    Configuration conf = new Configuration();
+    LocalDirsHandlerService dirsService  = new LocalDirsHandlerService();
+    DeletionService delService = new DeletionService(null);
+    NonAggregatingLogHandler aggregatingLogHandler =
+        new NonAggregatingLogHandler(new InlineDispatcher(),
+            delService,
+            dirsService);
+
+    dirsService.init(conf);
+    dirsService.start();
+    delService.init(conf);
+    delService.start();
+    aggregatingLogHandler.init(conf);
+    aggregatingLogHandler.start();
+    ApplicationId appId = BuilderUtils.newApplicationId(1234, 1);
+    // It should NOT throw RejectedExecutionException
+    aggregatingLogHandler.handle(new LogHandlerAppFinishedEvent(appId));
+    aggregatingLogHandler.stop();
+
+    // It should NOT throw RejectedExecutionException after stopping
+    // handler service.
+    aggregatingLogHandler.handle(new LogHandlerAppFinishedEvent(appId));
+  }
+
   private class NonAggregatingLogHandlerWithMockExecutor extends
       NonAggregatingLogHandler {