diff --git a/drivers/xen/balloon.c b/drivers/xen/balloon.c
index 1c789056e7e8..d6f5a74df973 100644
--- a/drivers/xen/balloon.c
+++ b/drivers/xen/balloon.c
@@ -584,8 +584,15 @@ static void balloon_process(struct work_struct *work)
 				state = reserve_additional_memory();
 		}
 
-		if (credit < 0)
-			state = decrease_reservation(-credit, GFP_BALLOON);
+		if (credit < 0) {
+			long n_pages;
+
+			n_pages = min(-credit, si_mem_available());
+			state = decrease_reservation(n_pages, GFP_BALLOON);
+			if (state == BP_DONE && n_pages != -credit &&
+			    n_pages < totalreserve_pages)
+				state = BP_EAGAIN;
+		}
 
 		state = update_schedule(state);
 
@@ -624,6 +631,9 @@ static int add_ballooned_pages(int nr_pages)
 		}
 	}
 
+	if (si_mem_available() < nr_pages)
+		return -ENOMEM;
+
 	st = decrease_reservation(nr_pages, GFP_USER);
 	if (st != BP_DONE)
 		return -ENOMEM;
@@ -747,7 +757,7 @@ static int __init balloon_init(void)
 	balloon_stats.schedule_delay = 1;
 	balloon_stats.max_schedule_delay = 32;
 	balloon_stats.retry_count = 1;
-	balloon_stats.max_retry_count = RETRY_UNLIMITED;
+	balloon_stats.max_retry_count = 4;
 
 #ifdef CONFIG_XEN_BALLOON_MEMORY_HOTPLUG
 	set_online_page_callback(&xen_online_page);