diff --git a/Source/CTest/cmCTestUpdateHandler.cxx b/Source/CTest/cmCTestUpdateHandler.cxx
index 8494d28c3..963e50173 100644
--- a/Source/CTest/cmCTestUpdateHandler.cxx
+++ b/Source/CTest/cmCTestUpdateHandler.cxx
@@ -283,13 +283,13 @@ int cmCTestUpdateHandler::ProcessHandler()
     {
     xml.Content("Update command failed:\n");
     xml.Content(vc->GetUpdateCommandLine());
-    cmCTestLog(this->CTest, ERROR_MESSAGE, "   Update command failed: "
+    cmCTestLog(this->CTest, HANDLER_OUTPUT, "   Update command failed: "
                << vc->GetUpdateCommandLine() << "\n");
     }
   xml.EndElement(); // UpdateReturnStatus
   xml.EndElement(); // Update
   xml.EndDocument();
-  return numUpdated;
+  return updated? numUpdated : -1;
 }
 
 //----------------------------------------------------------------------
diff --git a/Tests/CTestUpdateCVS.cmake.in b/Tests/CTestUpdateCVS.cmake.in
index 1699c3f1f..277b3a603 100644
--- a/Tests/CTestUpdateCVS.cmake.in
+++ b/Tests/CTestUpdateCVS.cmake.in
@@ -170,3 +170,22 @@ set(CTEST_CHECKOUT_COMMAND
 
 # Run the dashboard script with CTest.
 run_dashboard_script(dash-binary)
+
+#-----------------------------------------------------------------------------
+# Test ctest_update(RETURN_VALUE) on failure
+message("Running CTest Dashboard Script (fail to update)...")
+
+set(ctest_update_check [[
+if(NOT ret LESS 0)
+  message(FATAL_ERROR "ctest_update incorrectly succeeded with ${ret}")
+endif()
+]])
+create_dashboard_script(dash-binary-fail
+  "set(CTEST_CVS_COMMAND \"update-command-does-not-exist\")
+")
+unset(ctest_update_check)
+
+# Run the dashboard script with CTest.
+set(FAIL_UPDATE 1)
+run_dashboard_script(dash-binary-fail)
+unset(FAIL_UPDATE)
diff --git a/Tests/CTestUpdateCommon.cmake b/Tests/CTestUpdateCommon.cmake
index df1a713c5..458e42743 100644
--- a/Tests/CTestUpdateCommon.cmake
+++ b/Tests/CTestUpdateCommon.cmake
@@ -258,6 +258,24 @@ function(check_no_update bin_dir)
   endif()
 endfunction()
 
+#-----------------------------------------------------------------------------
+# Function to find the Update.xml file and make sure
+# it only has the UpdateReturnStatus failure message and no updates.
+function(check_fail_update bin_dir)
+  set(PATTERN ${TOP}/${bin_dir}/Testing/*/Update.xml)
+  file(GLOB UPDATE_XML_FILE RELATIVE ${TOP} ${PATTERN})
+  string(REGEX REPLACE "//Update.xml$" "/Update.xml"
+    UPDATE_XML_FILE "${UPDATE_XML_FILE}")
+  message(" found ${UPDATE_XML_FILE}")
+  file(STRINGS ${TOP}/${UPDATE_XML_FILE} UPDATE_XML_STATUS
+    REGEX "^\t<UpdateReturnStatus>[^<\n]+"
+    )
+  if(UPDATE_XML_STATUS MATCHES "Update command failed")
+    message(" correctly found 'Update command failed'")
+  else()
+    message(FATAL_ERROR " missing 'Update command failed'")
+  endif()
+endfunction()
 
 #-----------------------------------------------------------------------------
 # Function to run the dashboard through a script
@@ -271,6 +289,8 @@ function(run_dashboard_script bin_dir)
   list(APPEND UPDATE_MAYBE Updated{subdir} Updated{CTestConfig.cmake})
   if(NO_UPDATE)
     check_no_update(${bin_dir})
+  elseif(FAIL_UPDATE)
+    check_fail_update(${bin_dir})
   else()
     check_updates(${bin_dir}
       Updated{foo.txt}
diff --git a/Tests/CTestUpdateGIT.cmake.in b/Tests/CTestUpdateGIT.cmake.in
index 3734e2b86..6488a1f2f 100644
--- a/Tests/CTestUpdateGIT.cmake.in
+++ b/Tests/CTestUpdateGIT.cmake.in
@@ -358,3 +358,23 @@ run_dashboard_script(dash-binary-quiet)
 if("${OUTPUT}" MATCHES "Updating the repository")
   message(FATAL_ERROR "Found 'Updating the repository' in quiet output")
 endif()
+
+#-----------------------------------------------------------------------------
+# Test ctest_update(RETURN_VALUE) on failure
+message("Running CTest Dashboard Script (fail to update)...")
+
+set(ctest_update_check [[
+
+if(NOT ret LESS 0)
+  message(FATAL_ERROR "ctest_update incorrectly succeeded with ${ret}")
+endif()
+]])
+create_dashboard_script(dash-binary-fail
+  "set(CTEST_GIT_COMMAND \"update-command-does-not-exist\")
+")
+unset(ctest_update_check)
+
+# Run the dashboard script with CTest.
+set(FAIL_UPDATE 1)
+run_dashboard_script(dash-binary-fail)
+unset(FAIL_UPDATE)
diff --git a/Tests/CTestUpdateHG.cmake.in b/Tests/CTestUpdateHG.cmake.in
index c5440f954..c76bf9192 100644
--- a/Tests/CTestUpdateHG.cmake.in
+++ b/Tests/CTestUpdateHG.cmake.in
@@ -164,3 +164,22 @@ execute_process(
 
 # Run the dashboard script with CTest.
 run_dashboard_script(dash-binary)
+
+#-----------------------------------------------------------------------------
+# Test ctest_update(RETURN_VALUE) on failure
+message("Running CTest Dashboard Script (fail to update)...")
+
+set(ctest_update_check [[
+if(NOT ret LESS 0)
+  message(FATAL_ERROR "ctest_update incorrectly succeeded with ${ret}")
+endif()
+]])
+create_dashboard_script(dash-binary-fail
+  "set(CTEST_HG_COMMAND \"update-command-does-not-exist\")
+")
+unset(ctest_update_check)
+
+# Run the dashboard script with CTest.
+set(FAIL_UPDATE 1)
+run_dashboard_script(dash-binary-fail)
+unset(FAIL_UPDATE)
diff --git a/Tests/CTestUpdateSVN.cmake.in b/Tests/CTestUpdateSVN.cmake.in
index b5728fd67..b757a441d 100644
--- a/Tests/CTestUpdateSVN.cmake.in
+++ b/Tests/CTestUpdateSVN.cmake.in
@@ -147,3 +147,22 @@ set(CTEST_CHECKOUT_COMMAND
 
 # Run the dashboard script with CTest.
 run_dashboard_script(dash-binary)
+
+#-----------------------------------------------------------------------------
+# Test ctest_update(RETURN_VALUE) on failure
+message("Running CTest Dashboard Script (fail to update)...")
+
+set(ctest_update_check [[
+if(NOT ret LESS 0)
+  message(FATAL_ERROR "ctest_update incorrectly succeeded with ${ret}")
+endif()
+]])
+create_dashboard_script(dash-binary-fail
+  "set(CTEST_SVN_COMMAND \"update-command-does-not-exist\")
+")
+unset(ctest_update_check)
+
+# Run the dashboard script with CTest.
+set(FAIL_UPDATE 1)
+run_dashboard_script(dash-binary-fail)
+unset(FAIL_UPDATE)