diff --git a/avocado/core/test.py b/avocado/core/test.py
index eb79e2960e..763cf705bb 100644
--- a/avocado/core/test.py
+++ b/avocado/core/test.py
@@ -585,7 +585,7 @@ def _run_test(self):
             self.__skip_test = True
             stacktrace.log_exc_info(sys.exc_info(), logger=self.log)
             raise exceptions.TestSkipError(details)
-        except exceptions.TestCancel:
+        except (exceptions.TestCancel, exceptions.TestInterrupt):
             stacktrace.log_exc_info(sys.exc_info(), logger=self.log)
             raise
         except:  # Old-style exceptions are not inherited from Exception()
@@ -633,7 +633,7 @@ def _tearDown(self):
                 f"test. Original skip exception: {details}"
             )
             raise exceptions.TestError(skip_illegal_msg)
-        except exceptions.TestCancel:
+        except (exceptions.TestCancel, exceptions.TestInterrupt):
             stacktrace.log_exc_info(sys.exc_info(), logger=self.log)
             raise
         except:  # avoid old-style exception failures pylint: disable=W0702
diff --git a/selftests/check.py b/selftests/check.py
index 29a3e9f815..b471b1bba8 100755
--- a/selftests/check.py
+++ b/selftests/check.py
@@ -29,7 +29,7 @@
     "nrunner-requirement": 28,
     "unit": 678,
     "jobs": 11,
-    "functional-parallel": 307,
+    "functional-parallel": 309,
     "functional-serial": 7,
     "optional-plugins": 0,
     "optional-plugins-golang": 2,
diff --git a/selftests/functional/basic.py b/selftests/functional/basic.py
index cf47d72f10..9cb3e147d3 100644
--- a/selftests/functional/basic.py
+++ b/selftests/functional/basic.py
@@ -110,6 +110,28 @@ def test(self):
 fi
 """
 
+TIMEOUT_TEST = """import time
+
+from avocado import Test
+
+
+class TimeoutTest(Test):
+
+    timeout = 3
+
+    def setUp(self):
+        sleep_time = float(self.params.get("sleep_time_setup", default=0.0))
+        time.sleep(sleep_time)
+
+    def test(self):
+        sleep_time = float(self.params.get("sleep_time", default=0.0))
+        time.sleep(sleep_time)
+
+    def tearDown(self):
+        sleep_time = float(self.params.get("sleep_time_teardown", default=0.0))
+        time.sleep(sleep_time)
+"""
+
 
 def probe_binary(binary):
     try:
@@ -545,6 +567,48 @@ def test_runner_timeout_factor(self):
         )
         self.assertNotIn("timeout", result_json["tests"][0]["fail_reason"])
 
+    def test_runner_timeout_setup(self):
+        with script.TemporaryScript(
+            "timeout.py",
+            TIMEOUT_TEST,
+        ) as tst:
+            cmd_line = (
+                f"{AVOCADO} run --disable-sysinfo --job-results-dir "
+                f"{self.tmpdir.name} -p sleep_time_setup=5 -- {tst}"
+            )
+            result = process.run(cmd_line, ignore_status=True)
+            json_path = os.path.join(self.tmpdir.name, "latest", "results.json")
+            with open(json_path, encoding="utf-8") as json_file:
+                result_json = json.load(json_file)
+            expected_rc = exit_codes.AVOCADO_JOB_INTERRUPTED
+            self.assertEqual(
+                result.exit_status,
+                expected_rc,
+                f"Avocado did not return rc {expected_rc}:\n{result}",
+            )
+            self.assertNotIn("timeout", result_json["tests"][0]["fail_reason"])
+
+    def test_runner_timeout_teardown(self):
+        with script.TemporaryScript(
+            "timeout.py",
+            TIMEOUT_TEST,
+        ) as tst:
+            cmd_line = (
+                f"{AVOCADO} run --disable-sysinfo --job-results-dir "
+                f"{self.tmpdir.name} -p sleep_time_teardown=5 -- {tst}"
+            )
+            result = process.run(cmd_line, ignore_status=True)
+            json_path = os.path.join(self.tmpdir.name, "latest", "results.json")
+            with open(json_path, encoding="utf-8") as json_file:
+                result_json = json.load(json_file)
+            expected_rc = exit_codes.AVOCADO_JOB_INTERRUPTED
+            self.assertEqual(
+                result.exit_status,
+                expected_rc,
+                f"Avocado did not return rc {expected_rc}:\n{result}",
+            )
+            self.assertNotIn("timeout", result_json["tests"][0]["fail_reason"])
+
     def test_silent_output(self):
         cmd_line = (
             f"{AVOCADO} --show=none run --disable-sysinfo "