diff --git a/packages/core/integration-tests/test/hmr.js b/packages/core/integration-tests/test/hmr.js
index 0fe734ce817..d1dc9d765db 100644
--- a/packages/core/integration-tests/test/hmr.js
+++ b/packages/core/integration-tests/test/hmr.js
@@ -1,7 +1,14 @@
 const assert = require('assert');
 const fs = require('@parcel/fs');
 const path = require('path');
-const {bundler, run, rimraf, ncp} = require('@parcel/test-utils');
+const {
+  bundler,
+  run,
+  rimraf,
+  ncp,
+  prepareBrowserContext
+} = require('@parcel/test-utils');
+const vm = require('vm');
 const {sleep} = require('@parcel/test-utils');
 const WebSocket = require('ws');
 const json5 = require('json5');
@@ -318,6 +325,52 @@ describe('hmr', function() {
     assert.deepEqual(outputs, [3, 10]);
   });
 
+  it('should accept HMR updates in the runtime after an initial error', async function() {
+    await fs.mkdirp(path.join(__dirname, '/input'));
+    fs.writeFile(
+      path.join(__dirname, '/input/index.js'),
+      'module.hot.accept();throw new Error("Something");\noutput(123);'
+    );
+
+    b = bundler(path.join(__dirname, '/input/index.js'), {
+      watch: true,
+      hmr: true
+    });
+    let bundle = await b.bundle();
+
+    let outputs = [];
+    let errors = [];
+
+    var ctx = prepareBrowserContext(bundle, {
+      output(o) {
+        outputs.push(o);
+      },
+      error(e) {
+        errors.push(e);
+      }
+    });
+    vm.createContext(ctx);
+    vm.runInContext(
+      `try {
+        ${(await fs.readFile(bundle.name)).toString()}
+      } catch(e) {
+        error(e);
+      }`,
+      ctx
+    );
+
+    assert.deepEqual(outputs, []);
+    assert.equal(errors.length, 1);
+    assert.equal(errors[0].message, 'Something');
+
+    await sleep(100);
+    fs.writeFile(path.join(__dirname, '/input/index.js'), 'output(123);');
+
+    await nextEvent(b, 'bundled');
+    assert.deepEqual(outputs, [123]);
+    assert.equal(errors.length, 1);
+  });
+
   it('should call dispose and accept callbacks', async function() {
     await ncp(
       path.join(__dirname, '/integration/hmr-callbacks'),
diff --git a/packages/core/parcel-bundler/src/builtins/prelude.js b/packages/core/parcel-bundler/src/builtins/prelude.js
index 9dccee3e5b3..db17e45c58d 100644
--- a/packages/core/parcel-bundler/src/builtins/prelude.js
+++ b/packages/core/parcel-bundler/src/builtins/prelude.js
@@ -5,9 +5,7 @@
 //
 // anything defined in a previous bundle is accessed via the
 // orig method which is the require for previous bundles
-
-// eslint-disable-next-line no-global-assign
-parcelRequire = (function (modules, cache, entry, globalName) {
+(function (modules, cache, entry, globalName) {
   // Save the require from previous bundle to this closure if any
   var previousRequire = typeof parcelRequire === 'function' && parcelRequire;
   var nodeRequire = typeof require === 'function' && require;
@@ -77,8 +75,16 @@ parcelRequire = (function (modules, cache, entry, globalName) {
     }, {}];
   };
 
+  var error;
   for (var i = 0; i < entry.length; i++) {
-    newRequire(entry[i]);
+    try {
+      newRequire(entry[i]);
+    } catch (e) {
+      // Save first error but execute all entries
+      if (!error) {
+        error = e;
+      }
+    }
   }
 
   if (entry.length) {
@@ -103,5 +109,10 @@ parcelRequire = (function (modules, cache, entry, globalName) {
   }
 
   // Override the current require with this new one
-  return newRequire;
+  parcelRequire = newRequire;
+
+  if (error) {
+    // throw error from earlier, _after updating parcelRequire_
+    throw error;
+  }
 })
diff --git a/packages/core/test-utils/src/utils.js b/packages/core/test-utils/src/utils.js
index 63dc8436f53..3458b4ebc17 100644
--- a/packages/core/test-utils/src/utils.js
+++ b/packages/core/test-utils/src/utils.js
@@ -293,6 +293,7 @@ exports.symlinkPrivilegeWarning = symlinkPrivilegeWarning;
 exports.bundler = bundler;
 exports.bundle = bundle;
 exports.run = run;
+exports.prepareBrowserContext = prepareBrowserContext;
 exports.assertBundleTree = assertBundleTree;
 exports.nextBundle = nextBundle;
 exports.deferred = deferred;