diff --git a/go/tools/bzltestutil/timeout.go b/go/tools/bzltestutil/timeout.go
index 70d26d516b..c42e4a90b9 100644
--- a/go/tools/bzltestutil/timeout.go
+++ b/go/tools/bzltestutil/timeout.go
@@ -15,22 +15,25 @@
 package bzltestutil
 
 import (
+	"fmt"
 	"os"
 	"os/signal"
-	"runtime/debug"
+	"runtime"
 	"syscall"
 )
 
 func RegisterTimeoutHandler() {
-	// When the Bazel test timeout is reached, Bazel sends a SIGTERM. We
-	// panic just like native go test would so that the user gets stack
-	// traces of all running go routines.
+	// When the Bazel test timeout is reached, Bazel sends a SIGTERM. We print stack traces for all
+	// goroutines just like native go test would. We do not panic (like native go test does) because
+	// users may legitimately want to use SIGTERM in tests and prints are less disruptive than
+	// panics in that case.
 	// See https://github.com/golang/go/blob/e816eb50140841c524fd07ecb4eaa078954eb47c/src/testing/testing.go#L2351
 	c := make(chan os.Signal, 1)
 	signal.Notify(c, syscall.SIGTERM)
 	go func() {
 		<-c
-		debug.SetTraceback("all")
-		panic("test timed out")
+		buf := make([]byte, 1<<20)
+		stacklen := runtime.Stack(buf, true)
+		fmt.Printf("Received SIGTERM, printing stack traces of all goroutines:\n%s", buf[:stacklen])
 	}()
 }
diff --git a/tests/core/go_test/BUILD.bazel b/tests/core/go_test/BUILD.bazel
index e44564cca9..9a4fe21bad 100644
--- a/tests/core/go_test/BUILD.bazel
+++ b/tests/core/go_test/BUILD.bazel
@@ -250,6 +250,15 @@ go_test(
     shard_count = 2,
 )
 
+go_test(
+    name = "sigterm_handler_test",
+    srcs = ["sigterm_handler_test.go"],
+    target_compatible_with = select({
+        "@platforms//os:windows": ["@platforms//:incompatible"],
+        "//conditions:default": [],
+    }),
+)
+
 go_bazel_test(
     name = "env_inherit_test",
     srcs = ["env_inherit_test.go"],
diff --git a/tests/core/go_test/sigterm_handler_test.go b/tests/core/go_test/sigterm_handler_test.go
new file mode 100644
index 0000000000..2b0c8275dd
--- /dev/null
+++ b/tests/core/go_test/sigterm_handler_test.go
@@ -0,0 +1,40 @@
+package sigterm_handler_test
+
+import (
+	"os"
+	"os/signal"
+	"sync"
+	"syscall"
+	"testing"
+	"time"
+)
+
+func TestRegisterSignalHandler(t *testing.T) {
+	called := false
+	var wg sync.WaitGroup
+
+	wg.Add(1)
+
+	c := make(chan os.Signal, 1)
+	signal.Notify(c, syscall.SIGTERM)
+
+	go func() {
+		switch <-c {
+		case syscall.SIGTERM:
+			called = true
+			wg.Done()
+		}
+	}()
+
+	if err := syscall.Kill(os.Getpid(), syscall.SIGTERM); err != nil {
+		t.Fatalf("Failed to send SIGTERM: %v", err)
+	}
+	wg.Wait()
+
+	// Give any signal handlers registered by rules_go a chance to run.
+	time.Sleep(1 * time.Second)
+
+	if !called {
+		t.Fatal("Our handler has not run")
+	}
+}
diff --git a/tests/core/go_test/timeout_test.go b/tests/core/go_test/timeout_test.go
index 3c05206bf0..8d56feee55 100644
--- a/tests/core/go_test/timeout_test.go
+++ b/tests/core/go_test/timeout_test.go
@@ -38,7 +38,7 @@ func neverTerminates() {
 
 func TestTimeout(t *testing.T) {
 	if runtime.GOOS == "windows" {
-		t.Skip("panics on timeouts are not yet supported on Windows")
+		t.Skip("stack traces on timeouts are not yet supported on Windows")
 	}
 
 	if err := bazel_testing.RunBazel("test", "//:timeout_test", "--test_timeout=3"); err == nil {
@@ -57,8 +57,8 @@ func TestTimeout(t *testing.T) {
 	}
 
 	testLog := string(b)
-	if !strings.Contains(testLog, "panic: test timed out") {
-		t.Fatalf("test log does not contain expected panic:\n%s", testLog)
+	if !strings.Contains(testLog, "Received SIGTERM, printing stack traces of all goroutines:") {
+		t.Fatalf("test log does not contain expected header:\n%s", testLog)
 	}
 	if !strings.Contains(testLog, "timeout_test.neverTerminates(") {
 		t.Fatalf("test log does not contain expected stack trace:\n%s", testLog)