diff --git a/truss/templates/base.Dockerfile.jinja b/truss/templates/base.Dockerfile.jinja
index 892685141..77909c2c7 100644
--- a/truss/templates/base.Dockerfile.jinja
+++ b/truss/templates/base.Dockerfile.jinja
@@ -51,8 +51,10 @@ RUN pip install -r {{config_requirements_filename}} --no-cache-dir && rm -rf /ro
 
 
 
+{%- if not config.docker_server %}
 ENV APP_HOME="/app"
 WORKDIR $APP_HOME
+{%- endif %}
 
 {% block app_copy %}
 {% endblock %}
diff --git a/truss/test_data/test_custom_server_truss/config.yaml b/truss/test_data/test_custom_server_truss/config.yaml
index 473c74c0e..55bf42250 100644
--- a/truss/test_data/test_custom_server_truss/config.yaml
+++ b/truss/test_data/test_custom_server_truss/config.yaml
@@ -15,6 +15,6 @@ model_name: Test Docker Server Truss
 secrets:
   hf_access_token: null
 environment_variables:
-  HF_TOKEN: 123456
+  HF_TOKEN: 123
 runtime:
   predict_concurrency: 1
diff --git a/truss/tests/test_trussless_custom_server.py b/truss/tests/test_trussless_custom_server.py
index 695888b37..f63028c37 100644
--- a/truss/tests/test_trussless_custom_server.py
+++ b/truss/tests/test_trussless_custom_server.py
@@ -18,7 +18,10 @@ def test_custom_server_truss():
 
         tr = TrussHandle(truss_dir)
         LocalConfigHandler.set_secret("hf_access_token", "123")
-        _ = tr.docker_run(local_port=8090, detach=True, wait_for_server_ready=True, model_server_stop_retry_criteria=stop_after_delay(3))
+        try: 
+            _ = tr.docker_run(local_port=8090, detach=True, wait_for_server_ready=True, model_server_stop_retry_criteria=stop_after_delay(3))
+        except Exception as e:
+            raise Exception(f"Failed to start container: {e}")
         truss_server_addr = "http://localhost:8090"
         full_url = f"{truss_server_addr}/v1/models/model:predict"