diff --git a/libpod/runtime.go b/libpod/runtime.go
index 7da8b181f4..1118264f0e 100644
--- a/libpod/runtime.go
+++ b/libpod/runtime.go
@@ -17,6 +17,7 @@ import (
 	"github.com/containers/podman/v2/libpod/events"
 	"github.com/containers/podman/v2/libpod/image"
 	"github.com/containers/podman/v2/libpod/lock"
+	"github.com/containers/podman/v2/libpod/shutdown"
 	"github.com/containers/podman/v2/pkg/cgroups"
 	"github.com/containers/podman/v2/pkg/registries"
 	"github.com/containers/podman/v2/pkg/rootless"
@@ -174,9 +175,21 @@ func newRuntimeFromConfig(ctx context.Context, conf *config.Config, options ...R
 		}
 	}
 
+	if err := shutdown.Start(); err != nil {
+		return nil, errors.Wrapf(err, "error starting shutdown signal handler")
+	}
+
 	if err := makeRuntime(ctx, runtime); err != nil {
 		return nil, err
 	}
+
+	if err := shutdown.Register("libpod", func() error {
+		os.Exit(1)
+		return nil
+	}); err != nil {
+		logrus.Errorf("Error registering shutdown handler for libpod: %v", err)
+	}
+
 	return runtime, nil
 }
 
diff --git a/libpod/runtime_ctr.go b/libpod/runtime_ctr.go
index 51b4c5f039..de73a9ff35 100644
--- a/libpod/runtime_ctr.go
+++ b/libpod/runtime_ctr.go
@@ -12,6 +12,7 @@ import (
 	"github.com/containers/common/pkg/config"
 	"github.com/containers/podman/v2/libpod/define"
 	"github.com/containers/podman/v2/libpod/events"
+	"github.com/containers/podman/v2/libpod/shutdown"
 	"github.com/containers/podman/v2/pkg/cgroups"
 	"github.com/containers/podman/v2/pkg/rootless"
 	"github.com/containers/storage"
@@ -149,6 +150,10 @@ func (r *Runtime) setupContainer(ctx context.Context, ctr *Container) (_ *Contai
 		return nil, err
 	}
 
+	// Inhibit shutdown until creation succeeds
+	shutdown.Inhibit()
+	defer shutdown.Uninhibit()
+
 	// Allocate a lock for the container
 	lock, err := r.lockManager.AllocateLock()
 	if err != nil {
diff --git a/libpod/shutdown/handler.go b/libpod/shutdown/handler.go
index 79f236ab6f..7abaf065b9 100644
--- a/libpod/shutdown/handler.go
+++ b/libpod/shutdown/handler.go
@@ -84,6 +84,10 @@ func Uninhibit() {
 // Register registers a function that will be executed when Podman is terminated
 // by a signal.
 func Register(name string, handler func() error) error {
+	if handlers == nil {
+		handlers = make(map[string]func() error)
+	}
+
 	if _, ok := handlers[name]; ok {
 		return errors.Errorf("handler with name %s already exists", name)
 	}
@@ -95,6 +99,10 @@ func Register(name string, handler func() error) error {
 
 // Unregister un-registers a given shutdown handler.
 func Unregister(name string) error {
+	if handlers == nil {
+		handlers = make(map[string]func() error)
+	}
+
 	if _, ok := handlers[name]; !ok {
 		return errors.Errorf("no handler with name %s found", name)
 	}
diff --git a/pkg/api/server/server.go b/pkg/api/server/server.go
index cc5b45a651..24ad1874b5 100644
--- a/pkg/api/server/server.go
+++ b/pkg/api/server/server.go
@@ -190,6 +190,9 @@ func (s *APIServer) Serve() error {
 	}); err != nil {
 		return err
 	}
+	// Unregister the libpod handler, which just calls exit(1).
+	// Ignore errors if it doesn't exist.
+	_ = shutdown.Unregister("libpod")
 
 	errChan := make(chan error, 1)
 
@@ -226,12 +229,7 @@ func (s *APIServer) Serve() error {
 		errChan <- nil
 	}()
 
-	select {
-	case err := <-errChan:
-		return err
-	}
-
-	return nil
+	return <-errChan
 }
 
 // Shutdown is a clean shutdown waiting on existing clients
diff --git a/pkg/domain/infra/abi/terminal/sigproxy_linux.go b/pkg/domain/infra/abi/terminal/sigproxy_linux.go
index f484e926c0..0c586cf5c0 100644
--- a/pkg/domain/infra/abi/terminal/sigproxy_linux.go
+++ b/pkg/domain/infra/abi/terminal/sigproxy_linux.go
@@ -5,12 +5,17 @@ import (
 	"syscall"
 
 	"github.com/containers/podman/v2/libpod"
+	"github.com/containers/podman/v2/libpod/shutdown"
 	"github.com/containers/podman/v2/pkg/signal"
 	"github.com/sirupsen/logrus"
 )
 
 // ProxySignals ...
 func ProxySignals(ctr *libpod.Container) {
+	// Stop catching the shutdown signals (SIGINT, SIGTERM) - they're going
+	// to the container now.
+	shutdown.Stop()
+
 	sigBuffer := make(chan os.Signal, 128)
 	signal.CatchAll(sigBuffer)