diff --git a/src/opengeo/gui/dialogs/pgconnectiondialog.py b/src/opengeo/gui/dialogs/pgconnectiondialog.py
index 53acffa..ca85a49 100644
--- a/src/opengeo/gui/dialogs/pgconnectiondialog.py
+++ b/src/opengeo/gui/dialogs/pgconnectiondialog.py
@@ -98,10 +98,15 @@ def setupUi(self):
         horizontalLayout.addWidget(passwordLabel)
         horizontalLayout.addWidget(self.passwordBox)
         self.verticalLayout.addLayout(horizontalLayout)
+
+        horizontalLayout = QHBoxLayout()
+        self.statusLabel = QLabel('')
+        horizontalLayout.addWidget(self.statusLabel)
+        self.verticalLayout.addLayout(horizontalLayout)
         
         self.groupBox.setLayout(self.verticalLayout)
         self.layout.addWidget(self.groupBox)   
-        self.spacer = QSpacerItem(20,20, QSizePolicy.Minimum,QSizePolicy.Expanding)
+        self.spacer = QSpacerItem(20,10, QSizePolicy.Minimum,QSizePolicy.Expanding)
         self.layout.addItem(self.spacer)
 
         self.buttonBox = QDialogButtonBox(self)
@@ -146,6 +151,8 @@ def accept(self):
         settings.setValue("database", self.databaseBox.text() );
         settings.setValue("username", self.usernameBox.text());
         settings.setValue("password", self.passwordBox.text());
+        self.statusLabel.setText('Connecting ...')
+        QApplication.processEvents()
         self.conn = PgConnection(self.nameBox.text(), settings.value('host'), int(settings.value('port')), 
                             settings.value('database'), settings.value('username'), 
                             settings.value('password'))
diff --git a/src/opengeo/gui/pgexploreritems.py b/src/opengeo/gui/pgexploreritems.py
index 167f797..9aca046 100644
--- a/src/opengeo/gui/pgexploreritems.py
+++ b/src/opengeo/gui/pgexploreritems.py
@@ -128,8 +128,12 @@ def contextMenuActions(self, tree, explorer):
         return actions
         
     def _getDescriptionHtml(self, tree, explorer):  
-        if not self.element.isValid:            
-            html = ('<p>Cannot connect to this database. This might be caused by missing user/passwd credentials.'
+        if not self.element.isValid:
+            if self.element.connectionFailureMessage:
+                msg = self.element.connectionFailureMessage.replace('\n','<br>')
+                html = '<p>There was an error connecting to the database:</p><p>%s</p>' % msg
+            else:
+                html = ('<p>Cannot connect to this database. This might be caused by missing user/passwd credentials.'
                     'Try <a href="refresh">refreshing</a> the connection, to enter new credentials and retry to connect</p>')     
             return html
         else:
diff --git a/src/opengeo/postgis/connection.py b/src/opengeo/postgis/connection.py
index 5ccc11e..a3db5a9 100644
--- a/src/opengeo/postgis/connection.py
+++ b/src/opengeo/postgis/connection.py
@@ -1,4 +1,4 @@
-from postgis_utils import GeoDB
+from postgis_utils import GeoDB, DbError
 from schema import Schema
 from qgis.core import *
 from PyQt4 import QtCore
@@ -9,17 +9,26 @@
 class PgConnection(object):       
     
     def __init__(self, name, host, port, database, username, password):
-        self.name = name  
+        self.name = name
         self.host = host
         self.port = port
-        self.database = database      
+        self.database = database
+        self.connectionFailureMessage = None
+        self.isValid = False
         try:
             self.geodb = GeoDB(host, port, database, username, password)
-            self.isValid = True
-            self.username = username
-            self.password = password
-        except:
-            self.isValid = False
+        except DbError, ex:
+            self.connectionFailureMessage = str(ex)
+        else:
+            try:
+                self.geodb._exec_sql_and_commit('select * from postgis_version()')
+                self.isValid = True
+                self.username = username
+                self.password = password
+            except DbError, ex:
+                self.connectionFailureMessage = 'It appears that the PostGIS '\
+                    'extensions are not loaded in the database.<hr>\n'\
+                    'The error message was:\n%s' % ex
         
         
     def schemas(self):