diff --git a/lib/entropy/client/interfaces/package.py b/lib/entropy/client/interfaces/package.py
index f67f790f2..67df1edd6 100644
--- a/lib/entropy/client/interfaces/package.py
+++ b/lib/entropy/client/interfaces/package.py
@@ -3306,7 +3306,19 @@ class Package:
         # the setup phase could have created additional users and groups
         package_path = self.pkgmeta['pkgpath']
         prefix_dir = self.pkgmeta['imagedir']
-        entropy.tools.apply_tarball_ownership(package_path, prefix_dir)
+        try:
+            entropy.tools.apply_tarball_ownership(package_path, prefix_dir)
+        except IOError as err:
+            msg = "%s: %s" % (
+                brown(_("Error during package files permissions setup")),
+                err,)
+            self._entropy.output(
+                msg,
+                importance = 1,
+                level = "error",
+                header = darkred(" !!! ")
+            )
+            return 1
 
         return 0
 
diff --git a/lib/entropy/tools.py b/lib/entropy/tools.py
index 853d77f72..a542d5520 100644
--- a/lib/entropy/tools.py
+++ b/lib/entropy/tools.py
@@ -2095,11 +2095,14 @@ def apply_tarball_ownership(filepath, prefix_path):
         for tarinfo in tar:
             epath = os.path.join(encoded_path, tarinfo.name)
 
-            tar.chown(tarinfo, epath)
-            _fix_uid_gid(tarinfo, epath)
-            if not os.path.islink(epath):
-                # make sure we keep the same permissions
-                tar.chmod(tarinfo, epath)
+            try:
+                tar.chown(tarinfo, epath)
+                _fix_uid_gid(tarinfo, epath)
+                if not os.path.islink(epath):
+                    # make sure we keep the same permissions
+                    tar.chmod(tarinfo, epath)
+            except tarfile.ExtractError as err:
+                raise IOError(err)
 
             deleter_counter -= 1
             if deleter_counter == 0: