diff --git a/packages/stack/src/runtime/Container.integration.test.ts b/packages/stack/src/runtime/Container.integration.test.ts
index 3cd82ba7b4..02cf48fa10 100644
--- a/packages/stack/src/runtime/Container.integration.test.ts
+++ b/packages/stack/src/runtime/Container.integration.test.ts
@@ -1549,6 +1549,34 @@ describe("container process adapter", { timeout: 120_000 }, () => {
     }).pipe(Effect.provide(NodeServices.layer)),
   );
 
+  it.effect(
+    "names the stalled engine subcommand and its stderr when an engine command times out",
+    () =>
+      Effect.gen(function* () {
+        const engine = yield* makeStalledStartSpawner("Error: waiting for network sandbox");
+        const runtime = yield* makeContainerRuntime({
+          target: containerTarget,
+          root: ".",
+          hostGateway: sharedHostGateway,
+        }).pipe(Effect.provide(engine.layer));
+        const launch = yield* Effect.scoped(
+          runtime.launch({ image, stackId: "s".repeat(64), instanceId: "stalled-start", env: {} }),
+        ).pipe(Effect.provide(engine.layer), Effect.exit, Effect.forkChild);
+        yield* Deferred.await(engine.stderrRead);
+        yield* TestClock.adjust("30 seconds");
+        const result = yield* Fiber.join(launch);
+
+        const failure = Exit.isFailure(result)
+          ? Option.getOrUndefined(Cause.findErrorOption(result.cause))
+          : undefined;
+        expect(failure instanceof ContainerLaunchError).toBe(true);
+        expect(failureKind(failure)).toBe("engine-timeout");
+        expect(failure instanceof ContainerLaunchError ? failure.failure.message : undefined).toBe(
+          "Engine command 'start' did not finish within 30s; stderr: Error: waiting for network sandbox",
+        );
+      }).pipe(Effect.provide(NodeServices.layer)),
+  );
+
   it.effect("removes the container a hung docker create may still create when interrupted", () =>
     Effect.gen(function* () {
       const engine = yield* makeHangingCreateSpawner();
@@ -2202,6 +2230,39 @@ const successfulHandle = (stdout = "") =>
     unref: Effect.succeed(Effect.void),
   });
 
+/** Answers every engine command except `start`, which writes `stderr` and never exits. */
+const makeStalledStartSpawner = Effect.fn("ContainerTest.stalledStartSpawner")(function* (
+  stderr: string,
+) {
+  const stderrRead = yield* Deferred.make<void>();
+  const spawner = ChildProcessSpawner.make((command) => {
+    if (!ChildProcess.isStandardCommand(command)) return Effect.die("unexpected piped command");
+    if (command.args[0] === "info") return Effect.succeed(successfulHandle("fake-daemon-id"));
+    if (command.args[0] !== "start") return Effect.succeed(successfulHandle());
+    // The second pull only happens once the reader has consumed the stderr line.
+    const stalledStderr = Stream.succeed(new TextEncoder().encode(stderr)).pipe(
+      Stream.concat(Stream.fromEffectDrain(Deferred.succeed(stderrRead, undefined))),
+      Stream.concat(Stream.never),
+    );
+    return Effect.succeed(
+      ChildProcessSpawner.makeHandle({
+        pid: ChildProcessSpawner.ProcessId(0),
+        exitCode: Effect.never,
+        isRunning: Effect.succeed(true),
+        kill: () => Effect.void,
+        stdin: Sink.drain,
+        stdout: Stream.empty,
+        stderr: stalledStderr,
+        all: Stream.empty,
+        getInputFd: () => Sink.drain,
+        getOutputFd: () => Stream.empty,
+        unref: Effect.succeed(Effect.void),
+      }),
+    );
+  });
+  return { stderrRead, layer: Layer.succeed(ChildProcessSpawner.ChildProcessSpawner, spawner) };
+});
+
 const makeHangingCreateSpawner = Effect.fn("ContainerTest.hangingCreateSpawner")(function* () {
   const commands: string[][] = [];
   const createStarted = yield* Deferred.make<void>();
diff --git a/packages/stack/src/runtime/Container.ts b/packages/stack/src/runtime/Container.ts
index 7e64d2ae34..aaf1866570 100644
--- a/packages/stack/src/runtime/Container.ts
+++ b/packages/stack/src/runtime/Container.ts
@@ -5,7 +5,7 @@ import {
   Crypto,
   Data,
   Deferred,
-  type Duration,
+  Duration,
   Effect,
   Exit,
   FileSystem,
@@ -134,6 +134,32 @@ const engineKind = (
           ? "port-allocation"
           : undefined;
 
+const MANAGEMENT_COMMANDS = new Set([
+  "container",
+  "context",
+  "image",
+  "network",
+  "system",
+  "volume",
+]);
+
+/** Names the stalled engine subcommand and its latest stderr, never the full argv. */
+const commandTimedOut = (
+  args: ReadonlyArray<string>,
+  timeout: Duration.Input,
+  stderr: string,
+): Cause.TimeoutError => {
+  const [first = "command", second] = args;
+  const subcommand =
+    MANAGEMENT_COMMANDS.has(first) && second !== undefined && !second.startsWith("-")
+      ? `${first} ${second}`
+      : first;
+  const tail = stderr.trim().slice(-2000);
+  return new Cause.TimeoutError(
+    `Engine command '${subcommand}' did not finish within ${Duration.format(Duration.fromInputUnsafe(timeout))}${tail.length > 0 ? `; stderr: ${tail}` : ""}`,
+  );
+};
+
 const errorFor = (operation: string, cause: unknown): ContainerError => {
   const message = cause instanceof Error ? cause.message : String(cause);
   const kind = engineKind(operation, cause, message);
@@ -527,19 +553,25 @@ export const makeContainerRuntime = (options: {
         "process.arg_count": args.length,
         "container.command": args[0] ?? "",
       });
+      const stderrSoFar = yield* Ref.make("");
       return yield* Effect.scoped(
         Effect.gen(function* () {
           const child = yield* spawner.spawn(command(args));
-          const tail = (stream: typeof child.stdout) =>
+          const tail = (stream: typeof child.stdout, progress?: Ref.Ref<string>) =>
             stream.pipe(
               Stream.decodeText,
-              Stream.runFold(
+              Stream.runFoldEffect(
                 () => "",
-                (text, chunk) => (text + chunk).slice(-65536),
+                (text, chunk) => {
+                  const next = (text + chunk).slice(-65536);
+                  return progress === undefined
+                    ? Effect.succeed(next)
+                    : Ref.set(progress, next).pipe(Effect.as(next));
+                },
               ),
             );
           const [stdout, stderr, code] = yield* Effect.all(
-            [tail(child.stdout), tail(child.stderr), child.exitCode],
+            [tail(child.stdout), tail(child.stderr, stderrSoFar), child.exitCode],
             { concurrency: "unbounded" },
           );
           yield* Effect.annotateCurrentSpan("process.exit_code", Number(code));
@@ -551,10 +583,22 @@ export const makeContainerRuntime = (options: {
           return stdout.trim();
         }),
       ).pipe(
-        (effect) =>
-          commandOptions.timeout === undefined
+        (effect) => {
+          const timeout = commandOptions.timeout;
+          return timeout === undefined
             ? effect
-            : effect.pipe(Effect.timeout(commandOptions.timeout)),
+            : effect.pipe(
+                Effect.timeoutOrElse({
+                  duration: timeout,
+                  orElse: () =>
+                    Ref.get(stderrSoFar).pipe(
+                      Effect.flatMap((stderr) =>
+                        Effect.fail(commandTimedOut(args, timeout, stderr)),
+                      ),
+                    ),
+                }),
+              );
+        },
         Effect.mapError((cause) => errorFor(args[0] ?? "command", cause)),
       );
     });