diff --git a/ypserv-pre-setdomain b/ypserv-pre-setdomain
new file mode 100644
index 0000000..0c1f4e8
--- /dev/null
+++ b/ypserv-pre-setdomain
@@ -0,0 +1,21 @@
+#!/bin/sh
+#
+# ypserv-domain
+#
+# description: This is part of former ypserv init script, which is used 
+#              to setup proper domainname before starting ypserv daemon 
+#              itself. If $NISDOMAIN is not defined, it fails. 
+#
+
+DOMAINNAME=`domainname`
+if [ "$DOMAINNAME" = "(none)" -o "$DOMAINNAME" = "" ]; then
+    echo -n $"Setting NIS domain: "
+    if [ -n "$NISDOMAIN" ]; then
+        domainname $NISDOMAIN
+        echo $"'$NISDOMAIN' (environment variable)"
+    else # no domainname found
+        logger -t ypserv $"domain not found"
+        exit 1
+    fi
+fi
+
diff --git a/ypserv.service b/ypserv.service
index 0868394..0733a70 100644
--- a/ypserv.service
+++ b/ypserv.service
@@ -5,6 +5,7 @@ After=syslog.target network.target rpcbind.service
 
 [Service]
 EnvironmentFile=-/etc/sysconfig/network
+ExecStartPre=/usr/lib/ypserv/ypserv-pre-setdomain
 ExecStart=/usr/sbin/ypserv -f $YPSERV_ARGS
 
 [Install]
diff --git a/ypserv.spec b/ypserv.spec
index 6b21089..4fe5831 100644
--- a/ypserv.spec
+++ b/ypserv.spec
@@ -2,7 +2,7 @@ Summary: The NIS (Network Information Service) server
 Url: http://www.linux-nis.org/nis/ypserv/index.html
 Name: ypserv
 Version: 2.26
-Release: 9%{?dist}
+Release: 10%{?dist}
 License: GPLv2
 Group: System Environment/Daemons
 Source0: ftp://ftp.kernel.org/pub/linux/utils/net/NIS/ypserv-%{version}.tar.bz2
@@ -10,6 +10,7 @@ Source1: ypserv.service
 Source2: yppasswdd.service
 Source3: ypxfrd.service
 Source4: rpc.yppasswdd.env
+Source5: ypserv-pre-setdomain
 
 Requires: gawk, make, portmap, bash >= 2.0
 Requires(post): systemd-units
@@ -36,6 +37,9 @@ Patch15: ypserv-2.26-retval.patch
 BuildRequires: compat-gdbm-devel
 BuildRequires: systemd-units
 
+# Location where helper scripts are located
+%define scripts_path /usr/lib/%{name}
+
 %description
 The Network Information Service (NIS) is a system that provides
 network information (login names, passwords, home directories, group
@@ -86,11 +90,12 @@ rm -rf $RPM_BUILD_ROOT
 
 #make install ROOT=$RPM_BUILD_ROOT
 %makeinstall libexecdir=$RPM_BUILD_ROOT%{_libdir}/yp INSTALL_PROGRAM=install
-mkdir -p $RPM_BUILD_ROOT%{_unitdir} $RPM_BUILD_ROOT%{_sysconfdir}
-install -m644 etc/ypserv.conf $RPM_BUILD_ROOT%{_sysconfdir}
-install -m644 %{SOURCE1} $RPM_BUILD_ROOT%{_unitdir}/ypserv.service
-install -m644 %{SOURCE2} $RPM_BUILD_ROOT%{_unitdir}/yppasswdd.service
-install -m644 %{SOURCE3} $RPM_BUILD_ROOT%{_unitdir}/ypxfrd.service
+mkdir -p $RPM_BUILD_ROOT%{_unitdir} $RPM_BUILD_ROOT%{_sysconfdir} $RPM_BUILD_ROOT%{scripts_path}
+install -m 644 etc/ypserv.conf $RPM_BUILD_ROOT%{_sysconfdir}
+install -m 644 %{SOURCE1} $RPM_BUILD_ROOT%{_unitdir}/ypserv.service
+install -m 644 %{SOURCE2} $RPM_BUILD_ROOT%{_unitdir}/yppasswdd.service
+install -m 644 %{SOURCE3} $RPM_BUILD_ROOT%{_unitdir}/ypxfrd.service
+install -m 755 %{SOURCE5} $RPM_BUILD_ROOT%{scripts_path}/ypserv-pre-setdomain
 
 mkdir -p $RPM_BUILD_ROOT/etc/sysconfig
 cat >$RPM_BUILD_ROOT/etc/sysconfig/yppasswdd <<EOF
@@ -120,7 +125,7 @@ EOF
 # (ETCDIR, PASSWDFILE and SHADOWFILE). The script ensures, that the 
 # rpc.yppasswdd arguments are not used when the appropriate environment 
 # variables are empty.
-install -m755 %{SOURCE4} $RPM_BUILD_ROOT%{_sbindir}/rpc.yppasswdd.env
+install -m 755 %{SOURCE4} $RPM_BUILD_ROOT%{_sbindir}/rpc.yppasswdd.env
 
 %post
 # Package with native systemd unit file is installed for the first time
@@ -164,12 +169,17 @@ exit 0
 %config(noreplace) %{_sysconfdir}/sysconfig/yppasswdd
 %config(noreplace) /var/yp/*
 %{_unitdir}/*
+%{scripts_path}/*
 %{_libdir}/yp
 %{_sbindir}/*
 %{_mandir}/*/*
 %{_includedir}/*/*
 
 %changelog
+* Thu Jan 12 2012 Honza Horak <hhorak@redhat.com> - 2.26-10
+- Respect NISDOMAIN environment variable and set domainname if empty
+  Resolves: #699826
+
 * Mon Dec 12 2011 Honza Horak <hhorak@redhat.com> - 2.26-9
 - Rebuild against compat_gdbm, because gdbm has changed license 
   to GPLv3+ and it is not compatible with ypserv GPLv2