diff --git a/src/main/java/com/google/devtools/build/lib/skyframe/EnvironmentBackedRecursivePackageProvider.java b/src/main/java/com/google/devtools/build/lib/skyframe/EnvironmentBackedRecursivePackageProvider.java
index 285c45fa1cbec7..9dc0b1c3f04729 100644
--- a/src/main/java/com/google/devtools/build/lib/skyframe/EnvironmentBackedRecursivePackageProvider.java
+++ b/src/main/java/com/google/devtools/build/lib/skyframe/EnvironmentBackedRecursivePackageProvider.java
@@ -146,9 +146,8 @@ public Iterable<PathFragment> getPackagesUnderDirectory(
       }
 
       if (!repositoryValue.repositoryExists()) {
-        // This shouldn't be possible; we're given a repository, so we assume that the caller has
-        // already checked for its existence.
-        throw new IllegalStateException(String.format("No such repository '%s'", repository));
+        eventHandler.handle(Event.error(String.format("No such repository '%s'", repository)));
+        return ImmutableList.of();
       }
       roots.add(repositoryValue.getPath());
     }
diff --git a/src/test/shell/bazel/external_correctness_test.sh b/src/test/shell/bazel/external_correctness_test.sh
index 5dd6ca15c95671..d497aa9e05367e 100755
--- a/src/test/shell/bazel/external_correctness_test.sh
+++ b/src/test/shell/bazel/external_correctness_test.sh
@@ -331,4 +331,9 @@ function test_top_level_dir_changes_nobatch() {
   top_level_dir_changes_helper --nobatch
 }
 
+function test_non_extsietnt_repo_in_pattern() {
+  bazel build @non_existent_repo//... &> $TEST_log && fail "Expected build to fail"
+  expect_log "ERROR: No such repository '@non_existent_repo'"
+}
+
 run_suite "//external correctness tests"