diff --git a/src/wallet/rpcwallet.cpp b/src/wallet/rpcwallet.cpp
--- a/src/wallet/rpcwallet.cpp
+++ b/src/wallet/rpcwallet.cpp
@@ -2457,6 +2457,12 @@
     auto locked_chain = pwallet->chain().lock();
     LOCK(pwallet->cs_wallet);
 
+    if (pwallet->IsWalletFlagSet(WALLET_FLAG_DISABLE_PRIVATE_KEYS)) {
+        throw JSONRPCError(
+            RPC_WALLET_ENCRYPTION_FAILED,
+            "Error: wallet does not contain private keys, nothing to encrypt.");
+    }
+
     if (pwallet->IsCrypted()) {
         throw JSONRPCError(RPC_WALLET_WRONG_ENC_STATE,
                            "Error: running with an encrypted wallet, but "
diff --git a/test/functional/wallet_createwallet.py b/test/functional/wallet_createwallet.py
--- a/test/functional/wallet_createwallet.py
+++ b/test/functional/wallet_createwallet.py
@@ -117,7 +117,10 @@
         assert_raises_rpc_error(-4, "Error: This wallet has no available keys",
                                 w5.getrawchangeaddress)
         # Encrypt the wallet
-        w5.encryptwallet('pass')
+        assert_raises_rpc_error(-16,
+                                "Error: wallet does not contain private keys, nothing to encrypt.",
+                                w5.encryptwallet,
+                                'pass')
         assert_raises_rpc_error(-4,
                                 "Error: This wallet has no available keys", w5.getnewaddress)
         assert_raises_rpc_error(-4, "Error: This wallet has no available keys",