diff --git a/openadapt_capture/input_observer/base.py b/openadapt_capture/input_observer/base.py
index 8c31289..d3da66b 100644
--- a/openadapt_capture/input_observer/base.py
+++ b/openadapt_capture/input_observer/base.py
@@ -13,6 +13,10 @@ class InputObserverError(RuntimeError):
     """Base error for fail-loud input observation."""
 
 
+class _InputObserverStartupCancelledError(InputObserverError):
+    """Internal marker for setup failures caused by the parent's startup abort."""
+
+
 class InputObserverUnavailableError(InputObserverError):
     """The current platform/session cannot provide complete input observation."""
 
@@ -448,7 +452,7 @@ def start(self) -> None:
                 f"{type(self).__name__} did not become ready within "
                 f"{self.startup_timeout:.1f}s"
             )
-            self._abort_start(primary)
+            self._abort_start(primary, prefer_observer_failure=True)
         try:
             self.check_health()
         except BaseException as exc:
@@ -458,7 +462,12 @@ def start(self) -> None:
         except BaseException as exc:
             self._abort_start(exc)
 
-    def _abort_start(self, primary: BaseException) -> None:
+    def _abort_start(
+        self,
+        primary: BaseException,
+        *,
+        prefer_observer_failure: bool = False,
+    ) -> None:
         """Make a failed ``start`` transactional before surfacing its cause."""
         self._startup_failure = primary
         self._abort_delivery_start()
@@ -475,6 +484,31 @@ def _abort_start(self, primary: BaseException) -> None:
                 f"observer wake during failed startup also failed: {cleanup_exc}"
             )
         thread.join(self.shutdown_timeout)
+        if prefer_observer_failure:
+            # A setup failure can race with the readiness deadline.  Teardown
+            # must still complete transactionally, but once the observer
+            # thread has reported its concrete cause it is more useful and
+            # accurate than the parent thread's generic timeout.  A clean
+            # cancellation (the genuinely-never-ready case) retains the
+            # timeout above.
+            with self._failure_lock:
+                observer_failure = self._failure
+            if (
+                observer_failure is not None
+                and not isinstance(
+                    observer_failure,
+                    _InputObserverStartupCancelledError,
+                )
+            ):
+                if isinstance(observer_failure, InputObserverError):
+                    primary = observer_failure
+                else:
+                    wrapped = InputObserverError(
+                        f"{type(self).__name__} failed: {observer_failure}"
+                    )
+                    wrapped.__cause__ = observer_failure
+                    primary = wrapped
+                self._startup_failure = primary
         if thread.is_alive():
             add_exception_note(
                 primary,
diff --git a/openadapt_capture/input_observer/linux.py b/openadapt_capture/input_observer/linux.py
index ca9bdb0..53b952a 100644
--- a/openadapt_capture/input_observer/linux.py
+++ b/openadapt_capture/input_observer/linux.py
@@ -35,6 +35,7 @@
     ObservedMouseMove,
     ObservedMouseScroll,
     ThreadedInputObserver,
+    _InputObserverStartupCancelledError,
     add_exception_note,
 )
 
@@ -531,7 +532,7 @@ def _raise_if_setup_cancelled(self) -> None:
             return
         self._waiting_baseline_marker = False
         self._accepting_events = False
-        raise InputObserverError(
+        raise _InputObserverStartupCancelledError(
             "X RECORD setup was cancelled before the input boundary was ready"
         )
 
diff --git a/tests/test_input_observer.py b/tests/test_input_observer.py
index 55fb93c..c94a1d6 100644
--- a/tests/test_input_observer.py
+++ b/tests/test_input_observer.py
@@ -69,6 +69,15 @@ def _setup(self) -> None:
         self.release_setup.wait()
 
 
+class _FailureAfterReadinessTimeoutObserver(_CooperativeNeverReadyObserver):
+    """Report a concrete setup failure only after start begins its abort."""
+
+    def _setup(self) -> None:
+        self.resource_open = True
+        self._stop_requested.wait()
+        raise RuntimeError("setup failed while readiness timed out")
+
+
 class _ReadyObserver(ThreadedInputObserver):
     def __init__(self, callback=lambda _event: None) -> None:
         super().__init__(
@@ -214,6 +223,21 @@ def test_failed_startup_joins_and_tears_down_before_raising() -> None:
     assert not observer.resource_open
 
 
+def test_readiness_timeout_surfaces_setup_failure_observed_during_abort() -> None:
+    observer = _FailureAfterReadinessTimeoutObserver()
+
+    with pytest.raises(
+        InputObserverError,
+        match="setup failed while readiness timed out",
+    ):
+        observer.start()
+
+    assert observer._thread is None
+    assert observer._delivery_thread is None
+    assert observer.torn_down.is_set()
+    assert not observer.resource_open
+
+
 def test_lingering_failed_startup_cannot_be_reused_as_success() -> None:
     observer = _StubbornNeverReadyObserver()
     try: