diff --git a/test/standard/check-test-install-error-stop-script.bats b/test/standard/check-test-install-error-stop-script.bats
index be5f8a9..b6d80e8 100644
--- a/test/standard/check-test-install-error-stop-script.bats
+++ b/test/standard/check-test-install-error-stop-script.bats
@@ -4,8 +4,9 @@
 #
 # These tests exercise test/bin/check-test-install-error-stop.sh directly
 # against a bare scratch directory -- no foundation environment, no `make`,
-# no PostgreSQL. They cover the script's own pass/fail logic: direct
-# ON_ERROR_STOP, sourcing test/pgxntool/psql.sql, and files with neither.
+# and no PostgreSQL except the one psql.sql test at the end. The rule: a file fails only if it neither includes
+# test/pgxntool/psql.sql nor has any `\set`/`\unset ON_ERROR_STOP` command,
+# whatever the value or order.
 #
 # Tests that need real Make integration (TEST_DEPS wiring,
 # PGXNTOOL_ENABLE_TEST_INSTALL_ERROR_STOP_CHECK=no skipping the target) stay
@@ -42,13 +43,69 @@ setup() {
   assert_success
 }
 
-@test "check-test-install-error-stop.sh: fails when a file has neither" {
+@test "check-test-install-error-stop.sh: passes when a file sources psql.sql and turns ON_ERROR_STOP off" {
+  printf '\\i test/pgxntool/psql.sql\nCREATE TABLE foo AS SELECT 1;\n\\set ON_ERROR_STOP OFF\n' > "$TESTDIR/install/foo.sql"
+
+  run "$SCRIPT" "$TESTDIR"
+  assert_success
+}
+
+@test "check-test-install-error-stop.sh: passes when a file sources psql.sql via \\ir and unsets ON_ERROR_STOP" {
+  printf '\\ir ../pgxntool/psql.sql\nCREATE TABLE foo AS SELECT 1;\n\\unset ON_ERROR_STOP\n' > "$TESTDIR/install/foo.sql"
+
+  run "$SCRIPT" "$TESTDIR"
+  assert_success
+}
+
+@test "check-test-install-error-stop.sh: passes when ON_ERROR_STOP is only ever turned off" {
+  printf '\\set ON_ERROR_STOP 0\nCREATE TABLE foo AS SELECT 1;\n' > "$TESTDIR/install/foo.sql"
+
+  run "$SCRIPT" "$TESTDIR"
+  assert_success
+}
+
+@test "check-test-install-error-stop.sh: passes when ON_ERROR_STOP is only ever unset" {
+  printf '\\unset ON_ERROR_STOP\nCREATE TABLE foo AS SELECT 1;\n' > "$TESTDIR/install/foo.sql"
+
+  run "$SCRIPT" "$TESTDIR"
+  assert_success
+}
+
+@test "check-test-install-error-stop.sh: passes when ON_ERROR_STOP is turned on then off" {
+  printf '\\set ON_ERROR_STOP on\nCREATE TABLE foo AS SELECT 1;\n\\set ON_ERROR_STOP off\n' > "$TESTDIR/install/foo.sql"
+
+  run "$SCRIPT" "$TESTDIR"
+  assert_success
+}
+
+@test "check-test-install-error-stop.sh: passes when ON_ERROR_STOP is turned off then on" {
+  printf '\\set ON_ERROR_STOP off\nCREATE TABLE foo AS SELECT 1;\n\\set ON_ERROR_STOP on\n' > "$TESTDIR/install/foo.sql"
+
+  run "$SCRIPT" "$TESTDIR"
+  assert_success
+}
+
+@test "check-test-install-error-stop.sh: passes when the \\set is the last line with no trailing newline" {
+  printf 'CREATE TABLE foo AS SELECT 1;\n\\set ON_ERROR_STOP on' > "$TESTDIR/install/foo.sql"
+
+  run "$SCRIPT" "$TESTDIR"
+  assert_success
+}
+
+@test "check-test-install-error-stop.sh: fails when a file never mentions ON_ERROR_STOP" {
   printf 'CREATE TABLE foo AS SELECT 1;\n' > "$TESTDIR/install/foo.sql"
 
   run "$SCRIPT" "$TESTDIR"
   assert_failure_with_status 1
-  assert_contains "$output" "foo.sql"
-  assert_contains "$output" "ON_ERROR_STOP"
+  assert_contains "$output" "foo.sql: never sets ON_ERROR_STOP"
+}
+
+@test "check-test-install-error-stop.sh: fails when ON_ERROR_STOP appears only in a comment" {
+  printf -- '-- ON_ERROR_STOP is set by the caller\nCREATE TABLE foo AS SELECT 1;\n' > "$TESTDIR/install/foo.sql"
+
+  run "$SCRIPT" "$TESTDIR"
+  assert_failure_with_status 1
+  assert_contains "$output" "foo.sql: never sets ON_ERROR_STOP"
 }
 
 @test "check-test-install-error-stop.sh: reports every offending file, not just the first" {
@@ -74,3 +131,13 @@ setup() {
   run "$SCRIPT" "$TESTDIR" extra
   assert_failure
 }
+
+# Guards the assumption check-test-install-error-stop.sh makes when it accepts
+# files that include psql.sql. -X keeps ~/.psqlrc from masking a regression.
+@test "test/pgxntool/psql.sql makes psql stop on error" {
+  skip_if_no_postgres
+
+  run psql -X -f "$PGXNREPO/test/pgxntool/psql.sql" -c 'SELECT 1/0' -c '\echo SENTINEL'
+  assert_failure
+  [[ "$output" != *SENTINEL* ]]
+}