diff --git a/bin/addons/__init__.py b/bin/addons/__init__.py
index 3dbe722dc75..114b4ceb423 100644
--- a/bin/addons/__init__.py
+++ b/bin/addons/__init__.py
@@ -60,6 +60,8 @@ ad_paths.append(_ad)    # for get_module_path
 # Modules already loaded
 loaded = []
 
+#Modules whch raised error
+not_loaded = []
 
 class Graph(dict):
 
@@ -318,9 +320,9 @@ def upgrade_graph(graph, cr, module_list, force=None):
         mod_path = get_module_path(module)
         terp_file = get_module_resource(module, '__terp__.py')
         if not mod_path or not terp_file:
+            not_loaded.append(module)
             logger.notifyChannel('init', netsvc.LOG_WARNING, 'module %s: not installable' % (module))
-            cr.execute("update ir_module_module set state=%s where name=%s", ('uninstallable', module))
-            continue
+            raise osv.osv.except_osv('Error!',"Module '%s' was not found" % (module,))
 
         if os.path.isfile(terp_file) or zipfile.is_zipfile(mod_path+'.zip'):
             try:
@@ -685,7 +687,6 @@ def load_module_graph(cr, graph, status=None, perform_checks=True, **kwargs):
 def load_modules(db, force_demo=False, status=None, update_module=False):
     if not status:
         status = {}
-
     cr = db.cursor()
     if cr:
        cr.execute("SELECT relname FROM pg_class WHERE relkind='r' AND relname='ir_module_module'")
@@ -709,7 +710,9 @@ def load_modules(db, force_demo=False, status=None, update_module=False):
         graph = create_graph(cr, ['base'], force)
 
         has_updates = load_module_graph(cr, graph, status, perform_checks=(not update_module), report=report)
-
+        if not_loaded:
+            #If some module is not loaded don't proceed further
+            return
         if update_module:
             modobj = pool.get('ir.module.module')
             logger.notifyChannel('init', netsvc.LOG_INFO, 'updating modules list')