diff --git a/python_modules/dagster/dagster_tests/daemon_tests/test_backfill.py b/python_modules/dagster/dagster_tests/daemon_tests/test_backfill.py
index dbbe1a16d8ae4..f29367a9c5283 100644
--- a/python_modules/dagster/dagster_tests/daemon_tests/test_backfill.py
+++ b/python_modules/dagster/dagster_tests/daemon_tests/test_backfill.py
@@ -67,7 +67,10 @@
     ASSET_PARTITION_RANGE_END_TAG,
     ASSET_PARTITION_RANGE_START_TAG,
     BACKFILL_ID_TAG,
+    MAX_RETRIES_TAG,
+    PARENT_RUN_ID_TAG,
     PARTITION_NAME_TAG,
+    ROOT_RUN_ID_TAG,
 )
 from dagster._core.test_utils import (
     create_run_for_test,
@@ -229,6 +232,11 @@ def bar(a1):
     return a1
 
 
+@asset(partitions_def=static_partitions)
+def always_fails():
+    raise Exception("I always fail")
+
+
 @asset(
     config_schema={"myparam": Field(str, description="YYYY-MM-DD")},
 )
@@ -426,6 +434,7 @@ def the_repo():
         ab1,
         ab2,
         define_asset_job("twisted_asset_mess", selection="*b2", partitions_def=static_partitions),
+        always_fails,
         # baz is a configurable asset which has no dependencies
         baz,
         asset_a,
@@ -2861,3 +2870,70 @@ def test_asset_backfill_not_complete_until_retries_complete(
     backfill = instance.get_backfill(backfill_id)
     assert backfill
     assert backfill.status == BulkActionStatus.COMPLETED_SUCCESS
+
+
+def test_asset_backfill_not_complete_if_automatic_retry_could_happen(
+    instance: DagsterInstance,
+    workspace_context: WorkspaceProcessContext,
+    remote_repo: RemoteRepository,
+):
+    del remote_repo
+    backfill_id = "run_retries_backfill"
+    partition_keys = static_partitions.get_partition_keys()
+    asset_selection = [AssetKey("foo"), AssetKey("always_fails")]
+    instance.add_backfill(
+        PartitionBackfill.from_asset_partitions(
+            asset_graph=workspace_context.create_request_context().asset_graph,
+            backfill_id=backfill_id,
+            tags={"custom_tag_key": "custom_tag_value", MAX_RETRIES_TAG: "2"},
+            backfill_timestamp=get_current_timestamp(),
+            asset_selection=asset_selection,
+            partition_names=partition_keys,
+            dynamic_partitions_store=instance,
+            all_partitions=False,
+            title=None,
+            description=None,
+        )
+    )
+    assert instance.get_runs_count() == 0
+    backfill = instance.get_backfill("run_retries_backfill")
+    assert backfill
+    assert backfill.status == BulkActionStatus.REQUESTED
+
+    list(execute_backfill_iteration(workspace_context, get_default_daemon_logger("BackfillDaemon")))
+    assert instance.get_runs_count() == 3
+    wait_for_all_runs_to_start(instance, timeout=30)
+    assert instance.get_runs_count() == 3
+    wait_for_all_runs_to_finish(instance, timeout=30)
+
+    assert instance.get_runs_count() == 3
+    runs = reversed(list(instance.get_runs()))
+    for run in runs:
+        assert run.tags[BACKFILL_ID_TAG] == backfill_id
+        assert run.tags["custom_tag_key"] == "custom_tag_value"
+        assert step_succeeded(instance, run, "foo")
+        assert step_failed(instance, run, "always_fails")
+
+    # since the failed runs should have automatic retries launched for them, the backfill should not
+    # be considered complete, even though the targeted asset partitions have a completed state
+    list(execute_backfill_iteration(workspace_context, get_default_daemon_logger("BackfillDaemon")))
+    backfill = instance.get_backfill(backfill_id)
+    assert backfill
+    assert backfill.status == BulkActionStatus.REQUESTED
+
+    # automatic retries wont get kicked off in test environment, so we manually create them and mark them completed
+    runs = instance.get_runs()
+    for run in runs:
+        retried_run = create_run_for_test(
+            instance=instance,
+            job_name=run.job_name,
+            tags={**run.tags, ROOT_RUN_ID_TAG: run.run_id, PARENT_RUN_ID_TAG: run.run_id},
+            root_run_id=run.run_id,
+            parent_run_id=run.run_id,
+        )
+        mark_run_successful(instance, retried_run)
+
+    list(execute_backfill_iteration(workspace_context, get_default_daemon_logger("BackfillDaemon")))
+    backfill = instance.get_backfill(backfill_id)
+    assert backfill
+    assert backfill.status == BulkActionStatus.COMPLETED_FAILED