diff --git a/src/cmd/compile/internal/syntax/parser.go b/src/cmd/compile/internal/syntax/parser.go
index fcf4f5b6920..1ed20651b10 100644
--- a/src/cmd/compile/internal/syntax/parser.go
+++ b/src/cmd/compile/internal/syntax/parser.go
@@ -28,6 +28,8 @@ type parser struct {
 	nerrors int // error count
 }
 
+type parserError string // for error recovery if no error handler was installed
+
 func (p *parser) init(src io.Reader, errh ErrorHandler, pragh PragmaHandler) {
 	p.scanner.init(src, func(pos, line int, msg string) {
 		p.nerrors++
@@ -35,7 +37,7 @@ func (p *parser) init(src io.Reader, errh ErrorHandler, pragh PragmaHandler) {
 			errh(pos, line, msg)
 			return
 		}
-		panic(fmt.Sprintf("%d: %s\n", line, msg))
+		panic(parserError(fmt.Sprintf("%d: %s\n", line, msg)))
 	}, pragh)
 
 	p.fnest = 0
diff --git a/src/cmd/compile/internal/syntax/parser_test.go b/src/cmd/compile/internal/syntax/parser_test.go
index 8e6b77d0c68..780f10835cf 100644
--- a/src/cmd/compile/internal/syntax/parser_test.go
+++ b/src/cmd/compile/internal/syntax/parser_test.go
@@ -155,3 +155,10 @@ func verifyPrint(filename string, ast1 *File) {
 		panic("not equal")
 	}
 }
+
+func TestIssue17697(t *testing.T) {
+	_, err := ReadBytes(nil, nil, nil, 0) // return with parser error, don't panic
+	if err == nil {
+		t.Errorf("no error reported")
+	}
+}
diff --git a/src/cmd/compile/internal/syntax/syntax.go b/src/cmd/compile/internal/syntax/syntax.go
index 49831d0fbd0..71fc097c3b2 100644
--- a/src/cmd/compile/internal/syntax/syntax.go
+++ b/src/cmd/compile/internal/syntax/syntax.go
@@ -5,6 +5,7 @@
 package syntax
 
 import (
+	"errors"
 	"fmt"
 	"io"
 	"os"
@@ -52,18 +53,31 @@ func ReadBytes(src []byte, errh ErrorHandler, pragh PragmaHandler, mode Mode) (*
 	return Read(&bytesReader{src}, errh, pragh, mode)
 }
 
-func Read(src io.Reader, errh ErrorHandler, pragh PragmaHandler, mode Mode) (*File, error) {
+func Read(src io.Reader, errh ErrorHandler, pragh PragmaHandler, mode Mode) (ast *File, err error) {
+	defer func() {
+		if p := recover(); p != nil {
+			if msg, ok := p.(parserError); ok {
+				err = errors.New(string(msg))
+				return
+			}
+			panic(p)
+		}
+	}()
+
 	var p parser
 	p.init(src, errh, pragh)
-
 	p.next()
-	ast := p.file()
+	ast = p.file()
 
+	// TODO(gri) This isn't quite right: Even if there's an error handler installed
+	//           we should report an error if parsing found syntax errors. This also
+	//           requires updating the noder's ReadFile call.
 	if errh == nil && p.nerrors > 0 {
-		return nil, fmt.Errorf("%d syntax errors", p.nerrors)
+		ast = nil
+		err = fmt.Errorf("%d syntax errors", p.nerrors)
 	}
 
-	return ast, nil
+	return
 }
 
 func Write(w io.Writer, n *File) error {