diff --git a/packages/react-native/ReactCommon/jserrorhandler/JsErrorHandler.cpp b/packages/react-native/ReactCommon/jserrorhandler/JsErrorHandler.cpp
index 95578b0dc356b7..0caaf125ee10b1 100644
--- a/packages/react-native/ReactCommon/jserrorhandler/JsErrorHandler.cpp
+++ b/packages/react-native/ReactCommon/jserrorhandler/JsErrorHandler.cpp
@@ -91,16 +91,19 @@ JsErrorHandler::JsErrorHandler(JsErrorHandler::OnJsError onJsError)
 
 JsErrorHandler::~JsErrorHandler() {}
 
-void JsErrorHandler::handleFatalError(
+void JsErrorHandler::handleError(
     jsi::Runtime& runtime,
-    jsi::JSError& error) {
+    jsi::JSError& error,
+    bool isFatal) {
   // TODO: Current error parsing works and is stable. Can investigate using
   // REGEX_HERMES to get additional Hermes data, though it requires JS setup.
-  _hasHandledFatalError = true;
+  if (isFatal) {
+    _hasHandledFatalError = true;
+  }
 
   if (_isRuntimeReady) {
     try {
-      handleJSError(runtime, error, true);
+      handleJSError(runtime, error, isFatal);
       return;
     } catch (jsi::JSError& e) {
       LOG(ERROR)
@@ -175,7 +178,7 @@ void JsErrorHandler::handleFatalError(
       .componentStack = componentStack,
       .stack = stackFrames,
       .id = id,
-      .isFatal = true,
+      .isFatal = isFatal,
       .extraData = std::move(extraData),
   };
 
diff --git a/packages/react-native/ReactCommon/jserrorhandler/JsErrorHandler.h b/packages/react-native/ReactCommon/jserrorhandler/JsErrorHandler.h
index 372a81f358c3c5..d46ba183f62adf 100644
--- a/packages/react-native/ReactCommon/jserrorhandler/JsErrorHandler.h
+++ b/packages/react-native/ReactCommon/jserrorhandler/JsErrorHandler.h
@@ -43,7 +43,7 @@ class JsErrorHandler {
   explicit JsErrorHandler(OnJsError onJsError);
   ~JsErrorHandler();
 
-  void handleFatalError(jsi::Runtime& runtime, jsi::JSError& error);
+  void handleError(jsi::Runtime& runtime, jsi::JSError& error, bool isFatal);
   bool hasHandledFatalError();
   void setRuntimeReady();
   bool isRuntimeReady();
diff --git a/packages/react-native/ReactCommon/react/runtime/ReactInstance.cpp b/packages/react-native/ReactCommon/react/runtime/ReactInstance.cpp
index 66155b271114c6..db90f4a60b1009 100644
--- a/packages/react-native/ReactCommon/react/runtime/ReactInstance.cpp
+++ b/packages/react-native/ReactCommon/react/runtime/ReactInstance.cpp
@@ -84,7 +84,7 @@ ReactInstance::ReactInstance(
             }
           }
         } catch (jsi::JSError& originalError) {
-          jsErrorHandler->handleFatalError(jsiRuntime, originalError);
+          jsErrorHandler->handleError(jsiRuntime, originalError, true);
         }
       });
     }
@@ -129,7 +129,7 @@ ReactInstance::ReactInstance(
       RuntimeSchedulerClock::now,
       [jsErrorHandler = jsErrorHandler_](
           jsi::Runtime& runtime, jsi::JSError& error) {
-        jsErrorHandler->handleFatalError(runtime, error);
+        jsErrorHandler->handleError(runtime, error, true);
       });
   runtimeScheduler_->setPerformanceEntryReporter(
       // FIXME: Move creation of PerformanceEntryReporter to here and guarantee
@@ -422,16 +422,11 @@ void ReactInstance::initializeRuntime(
                 return jsi::Value(false);
               }
 
-              if (isFatal) {
-                auto jsError = jsi::JSError(
-                    runtime,
-                    jsi::Value(
-                        runtime, wrapInErrorIfNecessary(runtime, args[0])));
-                jsErrorHandler->handleFatalError(runtime, jsError);
-                return jsi::Value(true);
-              }
+              auto jsError = jsi::JSError(
+                  runtime, wrapInErrorIfNecessary(runtime, args[0]));
+              jsErrorHandler->handleError(runtime, jsError, isFatal);
 
-              return jsi::Value(false);
+              return jsi::Value(true);
             }));
 
     defineReadOnlyGlobal(