diff --git a/hadoop-common-project/hadoop-common/CHANGES.txt b/hadoop-common-project/hadoop-common/CHANGES.txt
index d1364a983a9..43368c08c4b 100644
--- a/hadoop-common-project/hadoop-common/CHANGES.txt
+++ b/hadoop-common-project/hadoop-common/CHANGES.txt
@@ -24,6 +24,9 @@ Release 2.0.3-alpha - Unreleased
     HADOOP-8795. BASH tab completion doesn't look in PATH, assumes path to
     executable is specified. (Sean Mackrory via atm)
 
+    HADOOP-8786. HttpServer continues to start even if AuthenticationFilter 
+    fails to init. (Todd Lipcon via umamahesh)
+
 Release 2.0.2-alpha - 2012-09-07 
 
   INCOMPATIBLE CHANGES
diff --git a/hadoop-common-project/hadoop-common/src/main/java/org/apache/hadoop/http/HttpServer.java b/hadoop-common-project/hadoop-common/src/main/java/org/apache/hadoop/http/HttpServer.java
index 3afc1e9c902..1b193cba195 100644
--- a/hadoop-common-project/hadoop-common/src/main/java/org/apache/hadoop/http/HttpServer.java
+++ b/hadoop-common-project/hadoop-common/src/main/java/org/apache/hadoop/http/HttpServer.java
@@ -676,6 +676,15 @@ public class HttpServer implements FilterContainer {
               "Problem in starting http server. Server handlers failed");
         }
       }
+      // Make sure there are no errors initializing the context.
+      Throwable unavailableException = webAppContext.getUnavailableException();
+      if (unavailableException != null) {
+        // Have to stop the webserver, or else its non-daemon threads
+        // will hang forever.
+        webServer.stop();
+        throw new IOException("Unable to initialize WebAppContext",
+            unavailableException);
+      }
     } catch (IOException e) {
       throw e;
     } catch (Exception e) {
diff --git a/hadoop-common-project/hadoop-common/src/test/java/org/apache/hadoop/http/TestServletFilter.java b/hadoop-common-project/hadoop-common/src/test/java/org/apache/hadoop/http/TestServletFilter.java
index c2ecbf39730..3c01320c218 100644
--- a/hadoop-common-project/hadoop-common/src/test/java/org/apache/hadoop/http/TestServletFilter.java
+++ b/hadoop-common-project/hadoop-common/src/test/java/org/apache/hadoop/http/TestServletFilter.java
@@ -35,6 +35,7 @@ import javax.servlet.http.HttpServletRequest;
 import org.apache.commons.logging.Log;
 import org.apache.commons.logging.LogFactory;
 import org.apache.hadoop.conf.Configuration;
+import org.apache.hadoop.test.GenericTestUtils;
 import org.junit.Test;
 
 public class TestServletFilter extends HttpServerFunctionalTest {
@@ -174,4 +175,24 @@ public class TestServletFilter extends HttpServerFunctionalTest {
           "Problem in starting http server. Server handlers failed"));
     }
   }
+  
+  /**
+   * Similar to the above test case, except that it uses a different API to add
+   * the filter. Regression test for HADOOP-8786.
+   */
+  @Test
+  public void testContextSpecificServletFilterWhenInitThrowsException()
+      throws Exception {
+    Configuration conf = new Configuration();
+    HttpServer http = createTestServer(conf);
+    http.defineFilter(http.webAppContext, "ErrorFilter", ErrorFilter.class
+        .getName(), null, null);
+    try {
+      http.start();
+      fail("expecting exception");
+    } catch (IOException e) {
+      GenericTestUtils.assertExceptionContains(
+          "Unable to initialize WebAppContext", e);
+    }
+  }
 }