diff --git a/mysql-test/r/skip_grants.result b/mysql-test/r/skip_grants.result
index 3052bae8e97..1ef35b051d6 100644
--- a/mysql-test/r/skip_grants.result
+++ b/mysql-test/r/skip_grants.result
@@ -70,3 +70,8 @@ count(*)
 select count(*) from information_schema.USER_PRIVILEGES;
 count(*)
 0
+CREATE FUNCTION a RETURNS STRING SONAME '';
+ERROR HY000: Can't initialize function 'a'; UDFs are unavailable with the --skip-grant-tables option
+DROP FUNCTION a;
+ERROR 42000: FUNCTION test.a does not exist
+End of 5.0 tests
diff --git a/mysql-test/t/skip_grants.test b/mysql-test/t/skip_grants.test
index 75694672a17..02a381063ee 100644
--- a/mysql-test/t/skip_grants.test
+++ b/mysql-test/t/skip_grants.test
@@ -116,3 +116,15 @@ select count(*) from information_schema.COLUMN_PRIVILEGES;
 select count(*) from information_schema.SCHEMA_PRIVILEGES;
 select count(*) from information_schema.TABLE_PRIVILEGES;
 select count(*) from information_schema.USER_PRIVILEGES;
+
+#
+# Bug #32020: loading udfs while --skip-grant-tables is enabled causes out of 
+#             memory errors
+#
+
+--error ER_CANT_INITIALIZE_UDF
+CREATE FUNCTION a RETURNS STRING SONAME '';
+--error ER_SP_DOES_NOT_EXIST
+DROP FUNCTION a;
+
+--echo End of 5.0 tests
diff --git a/sql/sql_udf.cc b/sql/sql_udf.cc
index ce6cd43eace..34ca18d5c39 100644
--- a/sql/sql_udf.cc
+++ b/sql/sql_udf.cc
@@ -410,7 +410,12 @@ int mysql_create_function(THD *thd,udf_func *udf)
 
   if (!initialized)
   {
-    my_message(ER_OUT_OF_RESOURCES, ER(ER_OUT_OF_RESOURCES), MYF(0));
+    if (opt_noacl)
+      my_error(ER_CANT_INITIALIZE_UDF, MYF(0),
+               udf->name.str,
+               "UDFs are unavailable with the --skip-grant-tables option");
+    else
+      my_message(ER_OUT_OF_RESOURCES, ER(ER_OUT_OF_RESOURCES), MYF(0));
     DBUG_RETURN(1);
   }
 
@@ -514,7 +519,10 @@ int mysql_drop_function(THD *thd,const LEX_STRING *udf_name)
   DBUG_ENTER("mysql_drop_function");
   if (!initialized)
   {
-    my_message(ER_OUT_OF_RESOURCES, ER(ER_OUT_OF_RESOURCES), MYF(0));
+    if (opt_noacl)
+      my_error(ER_FUNCTION_NOT_DEFINED, MYF(0), udf_name->str);
+    else
+      my_message(ER_OUT_OF_RESOURCES, ER(ER_OUT_OF_RESOURCES), MYF(0));
     DBUG_RETURN(1);
   }
   rw_wrlock(&THR_LOCK_udf);