diff --git a/panopoly.profile b/panopoly.profile
index 9edaaeb..359ab0e 100755
--- a/panopoly.profile
+++ b/panopoly.profile
@@ -69,11 +69,15 @@ function panopoly_form_install_configure_form_alter(&$form, $form_state) {
 
   // Set reasonable defaults for site configuration form
   $form['site_information']['site_name']['#default_value'] = 'Panopoly';
-  $form['site_information']['site_mail']['#default_value'] = 'admin@'. $_SERVER['HTTP_HOST']; 
   $form['admin_account']['account']['name']['#default_value'] = 'admin';
-  $form['admin_account']['account']['mail']['#default_value'] = 'admin@'. $_SERVER['HTTP_HOST'];
   $form['server_settings']['site_default_country']['#default_value'] = 'US';
   $form['server_settings']['date_default_timezone']['#default_value'] = 'America/Los_Angeles'; // West coast, best coast
+  // Don't set the email address to "admin@localhost" as that will fail D7's
+  // email address validation.
+  if ($_SERVER['HTTP_HOST'] != 'localhost') {
+    $form['site_information']['site_mail']['#default_value'] = 'admin@'. $_SERVER['HTTP_HOST'];
+    $form['admin_account']['account']['mail']['#default_value'] = 'admin@'. $_SERVER['HTTP_HOST'];
+  }
 }
 
 /**