diff --git a/CHANGELOG b/CHANGELOG
index 485331b..b74f0d6 100644
--- a/CHANGELOG
+++ b/CHANGELOG
@@ -28,6 +28,12 @@ version 2.93
 	relay is in use. Many thanks to Jørgen Søvik for help
 	finding this bug.
 	
+	Modify the inotify implementation so that inotify watches are
+	only created after dnsmasq has changed permissions and userid.
+	This means that the permissions used when creating the watches
+	are the same as used for accessing watched files, which makes
+	more sense and avoids odd and confusing error conditions.
+
 	
 version 2.92
         Redesign the interaction between DNSSEC validation and per-domain
diff --git a/src/dnsmasq.c b/src/dnsmasq.c
index 2bff016..4f9bf48 100644
--- a/src/dnsmasq.c
+++ b/src/dnsmasq.c
@@ -437,14 +437,6 @@ int main (int argc, char **argv)
 	daemon->tcp_pipes[i] = -1;
     }
 
-#ifdef HAVE_INOTIFY
-  if ((daemon->port != 0 && !option_bool(OPT_NO_RESOLV)) ||
-      daemon->dynamic_dirs)
-    inotify_dnsmasq_init();
-  else
-    daemon->inotifyfd = -1;
-#endif
-
   if (daemon->dump_file)
 #ifdef HAVE_DUMPFILE
     dump_init();
@@ -864,6 +856,14 @@ int main (int argc, char **argv)
     }
 #endif
 
+#ifdef HAVE_INOTIFY
+  if ((daemon->port != 0 && !option_bool(OPT_NO_RESOLV)) ||
+      daemon->dynamic_dirs)
+    inotify_dnsmasq_init(err_pipe[1]);
+  else
+    daemon->inotifyfd = -1;
+#endif
+  
    /* Don't start logging malloc before logging is set up. */
   daemon->log_malloc = option_bool(OPT_LOG_MALLOC);
   
@@ -1545,6 +1545,26 @@ static void fatal_event(struct event_desc *ev, char *msg)
       /* fall through */
     case EVENT_TIME_ERR:
       die(_("cannot create timestamp file %s: %s" ), msg, EC_BADCONF);
+
+      /* fall through */
+    case EVENT_LINK_ERR:
+      die(_("cannot access path %s: %s" ), msg, EC_MISC);
+
+       /* fall through */
+    case EVENT_INOTFY_ERR:
+      die(_("failed to create inotify: %s" ), NULL, EC_MISC);
+
+      /* fall through */
+    case EVENT_TMSL_ERR:
+      die(_("too many symlinks following %s"), msg, EC_MISC);
+
+      /* fall through */
+    case EVENT_RESOLV_ERR:
+      die(_("directory %s for resolv-file is missing, cannot poll"), msg, EC_MISC);
+
+      /* fall through */
+    case EVENT_IFILE_ERR:
+      die(_("failed to create inotify for %s: %s"), msg, EC_MISC);
     }
 }	
       
diff --git a/src/dnsmasq.h b/src/dnsmasq.h
index 42cc4a7..510c88f 100644
--- a/src/dnsmasq.h
+++ b/src/dnsmasq.h
@@ -201,6 +201,11 @@ struct event_desc {
 #define EVENT_TIME_ERR   24
 #define EVENT_SCRIPT_LOG 25
 #define EVENT_TIME       26
+#define EVENT_LINK_ERR   27
+#define EVENT_INOTFY_ERR 28
+#define EVENT_TMSL_ERR   29
+#define EVENT_RESOLV_ERR 30
+#define EVENT_IFILE_ERR  31
 
 /* Exit codes. */
 #define EC_GOOD        0
@@ -1907,7 +1912,7 @@ int detect_loop(char *query, int type);
 
 /* inotify.c */
 #ifdef HAVE_INOTIFY
-void inotify_dnsmasq_init(void);
+void inotify_dnsmasq_init(int errfd);
 int inotify_check(time_t now);
 void set_dynamic_inotify(int flag, int total_size, struct crec **rhash, int revhashsz);
 #endif
diff --git a/src/inotify.c b/src/inotify.c
index f70daea..2ec6e39 100644
--- a/src/inotify.c
+++ b/src/inotify.c
@@ -40,7 +40,7 @@ static char *inotify_buffer;
    points to, made absolute if relative.
    If path doesn't exist or is not a symlink, return NULL.
    Return value is malloc'ed */
-static char *my_readlink(char *path)
+static char *my_readlink(int errfd, char *path)
 {
   ssize_t rc, size = 64;
   char *buf;
@@ -59,7 +59,10 @@ static char *my_readlink(char *path)
 	      return NULL;
 	    }
 	  else
-	    die(_("cannot access path %s: %s"), path, EC_MISC);
+	    {
+	      send_event(errfd, EVENT_LINK_ERR, errno, path);
+	      _exit(0);
+	    }
 	}
       else if (rc < size-1)
 	{
@@ -85,15 +88,18 @@ static char *my_readlink(char *path)
     }
 }
 
-void inotify_dnsmasq_init()
+void inotify_dnsmasq_init(int errfd)
 {
   struct resolvc *res;
   inotify_buffer = safe_malloc(INOTIFY_SZ);
   daemon->inotifyfd = inotify_init1(IN_NONBLOCK | IN_CLOEXEC);
   
   if (daemon->inotifyfd == -1)
-    die(_("failed to create inotify: %s"), NULL, EC_MISC);
-
+    {
+      send_event(errfd, EVENT_INOTFY_ERR, errno, NULL);
+      _exit(0);
+    }
+  
   if (daemon->port == 0 || option_bool(OPT_NO_RESOLV))
     return;
   
@@ -105,10 +111,13 @@ void inotify_dnsmasq_init()
       strcpy(path, res->name);
 
       /* Follow symlinks until we reach a non-symlink, or a non-existent file. */
-      while ((new_path = my_readlink(path)))
+      while ((new_path = my_readlink(errfd, path)))
 	{
 	  if (links-- == 0)
-	    die(_("too many symlinks following %s"), res->name, EC_MISC);
+	    {
+	      send_event(errfd, EVENT_TMSL_ERR, 0, res->name);
+	      _exit(0);
+	    }
 	  free(path);
 	  path = new_path;
 	}
@@ -124,12 +133,18 @@ void inotify_dnsmasq_init()
 	  *d = '/';
 	  
 	  if (res->wd == -1 && errno == ENOENT)
-	    die(_("directory %s for resolv-file is missing, cannot poll"), res->name, EC_MISC);
+	    {
+	      send_event(errfd, EVENT_RESOLV_ERR, 0, res->name);
+	      _exit(0);
+	    }
 	}	  
 	 
       if (res->wd == -1)
-	die(_("failed to create inotify for %s: %s"), res->name, EC_MISC);
-	
+	{
+	  send_event(errfd, EVENT_IFILE_ERR, errno, res->name);
+	  _exit(0);
+	}
+      	
     }
 }