diff --git a/spring-web/src/main/java/org/springframework/web/filter/ServerHttpObservationFilter.java b/spring-web/src/main/java/org/springframework/web/filter/ServerHttpObservationFilter.java
index d0be09619fd5..3ca50f609b59 100644
--- a/spring-web/src/main/java/org/springframework/web/filter/ServerHttpObservationFilter.java
+++ b/spring-web/src/main/java/org/springframework/web/filter/ServerHttpObservationFilter.java
@@ -27,6 +27,7 @@
 import jakarta.servlet.http.HttpServletRequest;
 import jakarta.servlet.http.HttpServletResponse;
 
+import org.springframework.http.HttpStatus;
 import org.springframework.http.server.observation.DefaultServerRequestObservationConvention;
 import org.springframework.http.server.observation.ServerHttpObservationDocumentation;
 import org.springframework.http.server.observation.ServerRequestObservationContext;
@@ -108,7 +109,8 @@ protected void doFilterInternal(HttpServletRequest request, HttpServletResponse
 			filterChain.doFilter(request, response);
 		}
 		catch (Exception ex) {
-			observation.error(unwrapServletException(ex)).stop();
+			observation.error(unwrapServletException(ex));
+			response.setStatus(HttpStatus.INTERNAL_SERVER_ERROR.value());
 			throw ex;
 		}
 		finally {
diff --git a/spring-web/src/test/java/org/springframework/web/filter/ServerHttpObservationFilterTests.java b/spring-web/src/test/java/org/springframework/web/filter/ServerHttpObservationFilterTests.java
index 30648c8bfb48..354e5c50a48f 100644
--- a/spring-web/src/test/java/org/springframework/web/filter/ServerHttpObservationFilterTests.java
+++ b/spring-web/src/test/java/org/springframework/web/filter/ServerHttpObservationFilterTests.java
@@ -97,7 +97,18 @@ void filterShouldUnwrapServletException() {
 		ServerRequestObservationContext context = (ServerRequestObservationContext) this.request
 				.getAttribute(ServerHttpObservationFilter.CURRENT_OBSERVATION_CONTEXT_ATTRIBUTE);
 		assertThat(context.getError()).isEqualTo(customError);
-		assertThatHttpObservation().hasLowCardinalityKeyValue("outcome", "SUCCESS");
+		assertThatHttpObservation().hasLowCardinalityKeyValue("outcome", "SERVER_ERROR");
+	}
+
+	@Test
+	void filterShouldSetDefaultErrorStatusForBubblingExceptions() {
+		assertThatThrownBy(() -> {
+			this.filter.doFilter(this.request, this.response, (request, response) -> {
+				throw new ServletException(new IllegalArgumentException("custom error"));
+			});
+		}).isInstanceOf(ServletException.class);
+		assertThatHttpObservation().hasLowCardinalityKeyValue("outcome", "SERVER_ERROR")
+				.hasLowCardinalityKeyValue("status", "500");
 	}
 
 	private TestObservationRegistryAssert.TestObservationRegistryAssertReturningObservationContextAssert assertThatHttpObservation() {