diff --git a/netwerk/protocol/websocket/WebSocketChannel.cpp b/netwerk/protocol/websocket/WebSocketChannel.cpp
index e102c50777bf..de71e2ce4f4d 100644
--- a/netwerk/protocol/websocket/WebSocketChannel.cpp
+++ b/netwerk/protocol/websocket/WebSocketChannel.cpp
@@ -2425,11 +2425,16 @@ WebSocketChannel::OnProxyAvailable(nsICancelable *aRequest, nsIURI *aURI,
     LOG(("WebSocket OnProxyAvailable [%p] Proxy found skip DNS lookup\n", this));
     // call DNS callback directly without DNS resolver
     OnLookupComplete(nullptr, nullptr, NS_ERROR_FAILURE);
-    return NS_OK;
+  } else {
+    LOG(("WebSocketChannel::OnProxyAvailable[%] checking DNS resolution\n", this));
+    nsresult rv = DoAdmissionDNS();
+    if (NS_FAILED(rv)) {
+      LOG(("WebSocket OnProxyAvailable [%p] DNS lookup failed\n", this));
+      // call DNS callback directly without DNS resolver
+      OnLookupComplete(nullptr, nullptr, NS_ERROR_FAILURE);
+    }
   }
 
-  LOG(("WebSocketChannel::OnProxyAvailable[%] checking DNS resolution\n", this));
-  DoAdmissionDNS();
   return NS_OK;
 }
 
diff --git a/netwerk/test/unit/test_websocket_offline.js b/netwerk/test/unit/test_websocket_offline.js
new file mode 100644
index 000000000000..457f1f1b32bc
--- /dev/null
+++ b/netwerk/test/unit/test_websocket_offline.js
@@ -0,0 +1,45 @@
+/* This Source Code Form is subject to the terms of the Mozilla Public
+ * License, v. 2.0. If a copy of the MPL was not distributed with this
+ * file, You can obtain one at http://mozilla.org/MPL/2.0/. */
+
+Cu.import("resource://gre/modules/Services.jsm");
+
+// checking to make sure we don't hang as per 1038304
+// offline so url isn't impt
+var url = "ws://localhost";
+var chan;
+var offlineStatus;
+
+var listener = {
+  onAcknowledge: function(aContext, aSize) {},
+  onBinaryMessageAvailable: function(aContext, aMsg) {},
+  onMessageAvailable: function(aContext, aMsg) {},
+  onServerClose: function(aContext, aCode, aReason) {},
+  onStart: function(aContext)
+  {
+    // onStart is not called when a connection fails
+    do_check_true(false);
+  },
+  onStop: function(aContext, aStatusCode)
+  {
+    do_check_neq(aStatusCode, Cr.NS_OK);
+    Services.io.offline = offlineStatus;
+    do_test_finished();
+  }
+};
+
+function run_test() {
+  offlineStatus = Services.io.offline;
+  Services.io.offline = true;
+
+  try {
+    chan = Cc["@mozilla.org/network/protocol;1?name=ws"].
+      createInstance(Components.interfaces.nsIWebSocketChannel);
+    var uri = Services.io.newURI(url, null, null);
+    chan.asyncOpen(uri, url, listener, null);
+    do_test_pending();
+  } catch (x) {
+    dump("throwing " + x);
+    do_throw(x);
+  }
+}
diff --git a/netwerk/test/unit/xpcshell.ini b/netwerk/test/unit/xpcshell.ini
index 30958048d863..b566c66d5c88 100644
--- a/netwerk/test/unit/xpcshell.ini
+++ b/netwerk/test/unit/xpcshell.ini
@@ -342,3 +342,4 @@ run-if = os == "win"
 [test_udp_multicast.js]
 [test_redirect_history.js]
 [test_reply_without_content_type.js]
+[test_websocket_offline.js]