diff --git a/winsup/cygserver/ChangeLog b/winsup/cygserver/ChangeLog
index 677653194..63a37c624 100644
--- a/winsup/cygserver/ChangeLog
+++ b/winsup/cygserver/ChangeLog
@@ -1,3 +1,13 @@
+2012-11-23  Corinna Vinschen  <corinna@vinschen.de>
+
+	* cygserver.cc (main): Call listen right after creating the
+	transport.
+	* transport_pipes.cc (transport_layer_pipes::listen): Create
+	first instance of the named pipe here.  Connect the client side
+	to block it for further use by the system.
+	(transport_layer_pipes::accept): Don't handle first pipe instance
+	here.  Change debug output accordingly.
+
 2012-11-23  Christopher Faylor  <me.cygwin2012@cgf.cx>
 
 	* Makefile.in: Use /bin/mkdir to make install directories.
diff --git a/winsup/cygserver/cygserver.cc b/winsup/cygserver/cygserver.cc
index c58b236fa..8b3fd4c45 100644
--- a/winsup/cygserver/cygserver.cc
+++ b/winsup/cygserver/cygserver.cc
@@ -715,15 +715,15 @@ main (const int argc, char *argv[])
   transport_layer_base *const transport = create_server_transport ();
   assert (transport);
 
+  if (transport->listen () == -1)
+    return 1;
+
   process_cache cache (process_cache_size, cleanup_threads);
 
   server_submission_loop submission_loop (&request_queue, transport, &cache);
 
   request_queue.add_submission_loop (&submission_loop);
 
-  if (transport->listen () == -1)
-    return 1;
-
   cache.start ();
 
   request_queue.start ();
diff --git a/winsup/cygserver/transport_pipes.cc b/winsup/cygserver/transport_pipes.cc
index b44b98427..ccd505d17 100644
--- a/winsup/cygserver/transport_pipes.cc
+++ b/winsup/cygserver/transport_pipes.cc
@@ -107,7 +107,32 @@ transport_layer_pipes::listen ()
 
   _is_listening_endpoint = true;
 
-  /* no-op */
+  debug ("Try to create named pipe: %ls", _pipe_name);
+
+  HANDLE listen_pipe =
+    CreateNamedPipeW (_pipe_name,
+		      PIPE_ACCESS_DUPLEX | FILE_FLAG_FIRST_PIPE_INSTANCE,
+		      PIPE_TYPE_BYTE | PIPE_WAIT, PIPE_UNLIMITED_INSTANCES,
+		      0, 0, 1000, &sec_all_nih);
+  if (listen_pipe != INVALID_HANDLE_VALUE)
+    {
+      HANDLE connect_pipe =
+	CreateFileW (_pipe_name, GENERIC_READ | GENERIC_WRITE, 0, &sec_all_nih,
+		     OPEN_EXISTING, 0, NULL);
+      if (connect_pipe == INVALID_HANDLE_VALUE)
+	{
+	  CloseHandle (listen_pipe);
+	  listen_pipe = INVALID_HANDLE_VALUE;
+	}
+    }
+
+  if (listen_pipe == INVALID_HANDLE_VALUE)
+    {
+      system_printf ("failed to create named pipe: "
+		     "is the daemon already running?");
+      return -1;
+    }
+
   return 0;
 }
 
@@ -125,38 +150,19 @@ transport_layer_pipes::accept (bool *const recoverable)
   // Read: http://www.securityinternals.com/research/papers/namedpipe.php
   // See also the Microsoft security bulletins MS00-053 and MS01-031.
 
-  // FIXME: Remove FILE_CREATE_PIPE_INSTANCE.
-
-  const bool first_instance = (pipe_instance == 0);
-
-  debug ("Try to create named pipe: %ls", _pipe_name);
+  debug ("Try to create named pipe instance %ld: %ls",
+	 pipe_instance + 1, _pipe_name);
 
   const HANDLE accept_pipe =
-    CreateNamedPipeW (_pipe_name,
-		     (PIPE_ACCESS_DUPLEX
-		      | (first_instance ? FILE_FLAG_FIRST_PIPE_INSTANCE : 0)),
-		     (PIPE_TYPE_BYTE | PIPE_WAIT),
-		     PIPE_UNLIMITED_INSTANCES,
-		     0, 0, 1000,
-		     &sec_all_nih);
-
-  const bool duplicate = (accept_pipe == INVALID_HANDLE_VALUE
-			  && pipe_instance == 0
-			  && GetLastError () == ERROR_ACCESS_DENIED);
+    CreateNamedPipeW (_pipe_name, PIPE_ACCESS_DUPLEX,
+		      PIPE_TYPE_BYTE | PIPE_WAIT, PIPE_UNLIMITED_INSTANCES,
+		      0, 0, 1000, &sec_all_nih);
 
   if (accept_pipe != INVALID_HANDLE_VALUE)
     InterlockedIncrement (&pipe_instance);
 
   LeaveCriticalSection (&pipe_instance_lock);
 
-  if (duplicate)
-    {
-      *recoverable = false;
-      system_printf ("failed to create named pipe: "
-		     "is the daemon already running?");
-      return NULL;
-    }
-
   if (accept_pipe == INVALID_HANDLE_VALUE)
     {
       debug_printf ("error creating pipe (%lu).", GetLastError ());
@@ -164,8 +170,6 @@ transport_layer_pipes::accept (bool *const recoverable)
       return NULL;
     }
 
-  assert (accept_pipe);
-
   if (!ConnectNamedPipe (accept_pipe, NULL)
       && GetLastError () != ERROR_PIPE_CONNECTED)
     {