diff --git a/launch/launch/launch_service.py b/launch/launch/launch_service.py
index d49ebcbb8..9d7c0f9a8 100644
--- a/launch/launch/launch_service.py
+++ b/launch/launch/launch_service.py
@@ -94,7 +94,7 @@ def __init__(
         # it being set to None by run() as it exits.
         self.__loop_from_run_thread_lock = threading.RLock()
         self.__loop_from_run_thread = None
-        self.__this_task: Optional[asyncio.Future[None]] = None
+        self.__this_task: Optional[asyncio.Task[None]] = None
 
         # Used to indicate when shutdown() has been called.
         self.__shutting_down = False
@@ -156,7 +156,14 @@ def _prune_and_count_context_completion_futures(self) -> int:
     def _is_idle(self) -> bool:
         number_of_entity_future_pairs = self._prune_and_count_entity_future_pairs()
         number_of_entity_future_pairs += self._prune_and_count_context_completion_futures()
-        return number_of_entity_future_pairs == 0 and self.__context._event_queue.empty()
+        if self.event_loop is not None and self.__this_task is not None:
+            tasks = asyncio.all_tasks(self.event_loop)
+            tasks.remove(self.__this_task)
+        else:
+            tasks = set()
+        return (number_of_entity_future_pairs == 0 and
+                self.__context._event_queue.empty() and
+                len(tasks) == 0)
 
     @contextlib.contextmanager
     def _prepare_run_loop(
diff --git a/launch/test/launch/test_execute_local.py b/launch/test/launch/test_execute_local.py
index af515630c..ce9c9d473 100644
--- a/launch/test/launch/test_execute_local.py
+++ b/launch/test/launch/test_execute_local.py
@@ -178,3 +178,48 @@ def test_execute_process_with_output_dictionary():
     ls = LaunchService()
     ls.include_launch_description(ld)
     assert 0 == ls.run()
+
+
+def test_execute_process_with_shutdown_on_error():
+    """Test proper shutdown of children after exception during launch."""
+    exited_processes = 0
+
+    def on_exit(event, context):
+        nonlocal exited_processes
+        print(event, context)
+        exited_processes += 1
+
+    executable_1 = ExecuteLocal(
+        process_description=Executable(
+            cmd=[sys.executable, '-c', 'while True: pass']
+        ),
+        output={'stdout': 'screen', 'stderr': 'screen'},
+        on_exit=on_exit,
+    )
+    executable_2 = ExecuteLocal(
+        process_description=Executable(
+            cmd=[sys.executable, '-c', 'while True: pass']
+        ),
+        output={'stdout': 'screen', 'stderr': 'screen'},
+        on_exit=on_exit,
+    )
+
+    # It's slightly tricky to coerce the standard implementation to fail in
+    # this way. However, launch_ros's Node class can fail similar to this and
+    # this case therefore needs to be handled correctly.
+    class ExecutableThatFails(ExecuteLocal):
+
+        def execute(self, context):
+            raise Exception('Execute Local failed')
+
+    executable_invalid = ExecutableThatFails(
+        process_description=Executable(
+            cmd=['fake_process_that_doesnt_exists']
+        ),
+        output={'stdout': 'screen', 'stderr': 'screen'},
+    )
+    ld = LaunchDescription([executable_1, executable_2, executable_invalid])
+    ls = LaunchService()
+    ls.include_launch_description(ld)
+    assert ls.run() == 1
+    assert exited_processes == 2