diff --git a/Orange/widgets/unsupervised/owmds.py b/Orange/widgets/unsupervised/owmds.py
index 2b6c141f1c0..b686e3f961a 100644
--- a/Orange/widgets/unsupervised/owmds.py
+++ b/Orange/widgets/unsupervised/owmds.py
@@ -133,6 +133,8 @@ class Error(OWWidget.Error):
         no_attributes = Msg("Data has no attributes")
         mismatching_dimensions = \
             Msg("Data and distances dimensions do not match.")
+        out_of_memory = Msg("Out of memory")
+        optimization_error = Msg("Error during optimization\n{}")
 
     def __init__(self):
         super().__init__()
@@ -621,6 +623,7 @@ def __next_step(self):
             return
 
         loop = self.__update_loop
+        self.Error.out_of_memory.clear()
         try:
             embedding, stress, progress = next(self.__update_loop)
             assert self.__update_loop is loop
@@ -630,6 +633,14 @@ def __next_step(self):
             self.__draw_similar_pairs = True
             self._update_plot()
             self.plot.autoRange(padding=0.1, items=[self._scatter_item])
+        except MemoryError:
+            self.Error.out_of_memory()
+            self.__set_update_loop(None)
+            self.__draw_similar_pairs = True
+        except Exception as exc:
+            self.Error.optimization_error(str(exc))
+            self.__set_update_loop(None)
+            self.__draw_similar_pairs = True
         else:
             self.progressBarSet(100.0 * progress, processEvents=None)
             self.embedding = embedding
diff --git a/Orange/widgets/unsupervised/tests/test_owmds.py b/Orange/widgets/unsupervised/tests/test_owmds.py
index 75fb54396af..0e03be9317c 100644
--- a/Orange/widgets/unsupervised/tests/test_owmds.py
+++ b/Orange/widgets/unsupervised/tests/test_owmds.py
@@ -1,6 +1,7 @@
 # Test methods with long descriptive names can omit docstrings
 # pylint: disable=missing-docstring
 import random
+from unittest.mock import patch, Mock
 
 import numpy as np
 
@@ -69,3 +70,20 @@ def test_nan_plot(self):
         simulate.combobox_run_through_all(self.widget.cb_shape_value)
         simulate.combobox_run_through_all(self.widget.cb_size_value)
         simulate.combobox_run_through_all(self.widget.cb_label_value)
+
+    @patch("Orange.projection.MDS.__call__", Mock(side_effect=MemoryError))
+    def test_out_of_memory(self):
+        with patch("sys.excepthook", Mock()) as hook:
+            self.send_signal("Data", self.data)
+            self.process_events()
+            hook.assert_not_called()
+            self.assertTrue(self.widget.Error.out_of_memory.is_shown())
+
+    @patch("Orange.projection.MDS.__call__", Mock(side_effect=ValueError))
+    def test_other_error(self):
+        with patch("sys.excepthook", Mock()) as hook:
+            self.send_signal("Data", self.data)
+            self.process_events()
+            hook.assert_not_called()
+            self.assertTrue(self.widget.Error.optimization_error.is_shown())
+