diff --git a/changelogs/fragments/5369-pkgng-fix-update-all.yaml b/changelogs/fragments/5369-pkgng-fix-update-all.yaml
new file mode 100644
index 0000000000..783d461a9e
--- /dev/null
+++ b/changelogs/fragments/5369-pkgng-fix-update-all.yaml
@@ -0,0 +1,2 @@
+bugfixes:
+  - pkgng - fix case when ``pkg`` fails when trying to upgrade all packages (https://github.com/ansible-collections/community.general/issues/5363).
diff --git a/plugins/modules/packaging/os/pkgng.py b/plugins/modules/packaging/os/pkgng.py
index 5f4a2a5f27..6e94dcaee5 100644
--- a/plugins/modules/packaging/os/pkgng.py
+++ b/plugins/modules/packaging/os/pkgng.py
@@ -38,7 +38,7 @@ options:
     state:
         description:
             - State of the package.
-            - 'Note: "latest" added in 2.7'
+            - 'Note: C(latest) added in 2.7.'
         choices: [ 'present', 'latest', 'absent' ]
         required: false
         default: present
@@ -149,10 +149,7 @@ def query_package(module, run_pkgng, name):
 
     rc, out, err = run_pkgng('info', '-g', '-e', name)
 
-    if rc == 0:
-        return True
-
-    return False
+    return rc == 0
 
 
 def query_update(module, run_pkgng, name):
@@ -162,10 +159,7 @@ def query_update(module, run_pkgng, name):
     # rc = 1, updates available
     rc, out, err = run_pkgng('upgrade', '-g', '-n', name)
 
-    if rc == 1:
-        return True
-
-    return False
+    return rc == 1
 
 
 def pkgng_older_than(module, pkgng_path, compare_version):
@@ -191,7 +185,7 @@ def upgrade_packages(module, run_pkgng):
 
     pkgng_args = ['upgrade']
     pkgng_args.append('-n' if module.check_mode else '-y')
-    rc, out, err = run_pkgng(*pkgng_args)
+    rc, out, err = run_pkgng(*pkgng_args, check_rc=(not module.check_mode))
 
     matches = re.findall('^Number of packages to be (?:upgraded|reinstalled): ([0-9]+)', out, re.MULTILINE)
     for match in matches:
diff --git a/tests/integration/targets/pkgng/tasks/freebsd.yml b/tests/integration/targets/pkgng/tasks/freebsd.yml
index d17a3083d3..a7cb90b11d 100644
--- a/tests/integration/targets/pkgng/tasks/freebsd.yml
+++ b/tests/integration/targets/pkgng/tasks/freebsd.yml
@@ -140,6 +140,42 @@
           - pkgng_example4.changed
           - not pkgng_example4_idempotent.changed
 
+##
+## pkgng - example - state=latest for out-of-date package without privileges
+##
+- name: Install intentionally out-of-date package and try to upgrade it with unprivileged user
+  block:
+    - ansible.builtin.user:
+        name: powerless
+        shell: /bin/bash
+
+    - name: Create out-of-date test package
+      import_tasks: create-outofdate-pkg.yml
+
+    - name: Install out-of-date test package
+      command: 'pkg add {{ pkgng_test_outofdate_pkg_path }}'
+      register: pkgng_example4_nopower_prepare
+
+    - name: Check for any available package upgrades with unprivileged user
+      become: true
+      become_user: powerless
+      pkgng:
+        name: '*'
+        state: latest
+      register: pkgng_example4_nopower_wildcard
+      ignore_errors: true
+
+    - name: Remove test out-of-date package
+      pkgng:
+        name: '{{ pkgng_test_pkg_name }}'
+        state: absent
+
+    - name: Ensure pkgng upgrades package correctly
+      assert:
+        that:
+          - not pkgng_example4_nopower_prepare.failed
+          - pkgng_example4_nopower_wildcard.failed
+
 ##
 ## pkgng - example - Install multiple packages in one command
 ##