diff --git a/packages/core/src/instance-settings/__tests__/instance-settings.test.ts b/packages/core/src/instance-settings/__tests__/instance-settings.test.ts
index 6c7418001ce..d52358161f0 100644
--- a/packages/core/src/instance-settings/__tests__/instance-settings.test.ts
+++ b/packages/core/src/instance-settings/__tests__/instance-settings.test.ts
@@ -9,7 +9,6 @@ import { WorkerMissingEncryptionKey } from '../worker-missing-encryption-key.err
 
 describe('InstanceSettings', () => {
 	const userFolder = '/test';
-	const settingsFile = `${userFolder}/.n8n/config`;
 
 	const mockFs = mock(fs);
 	const logger = mock<Logger>();
@@ -202,25 +201,16 @@ describe('InstanceSettings', () => {
 
 			const settings = createInstanceSettings();
 
-			const [instanceType, nanoid] = settings.hostId.split('-');
+			const [instanceType, hostId] = settings.hostId.split('-');
 			expect(instanceType).toEqual('main');
-			expect(nanoid).toHaveLength(16); // e.g. sDX6ZPc0bozv66zM
+			expect(hostId.length).toBeGreaterThan(0); // hostname or nanoID
 		});
 	});
 
 	describe('isDocker', () => {
-		let settings: InstanceSettings;
-
-		beforeEach(() => {
-			mockFs.existsSync.calledWith(settingsFile).mockReturnValue(true);
-			mockFs.readFileSync
-				.calledWith(settingsFile)
-				.mockReturnValue(JSON.stringify({ encryptionKey: 'test_key' }));
-			settings = createInstanceSettings();
-		});
-
 		it('should return true if /.dockerenv exists', () => {
 			mockFs.existsSync.mockImplementation((path) => path === '/.dockerenv');
+			const settings = createInstanceSettings();
 			expect(settings.isDocker).toBe(true);
 			expect(mockFs.existsSync).toHaveBeenCalledWith('/.dockerenv');
 			expect(mockFs.readFileSync).not.toHaveBeenCalledWith('/proc/self/cgroup', 'utf8');
@@ -228,6 +218,7 @@ describe('InstanceSettings', () => {
 
 		it('should return true if /run/.containerenv exists', () => {
 			mockFs.existsSync.mockImplementation((path) => path === '/run/.containerenv');
+			const settings = createInstanceSettings();
 			expect(settings.isDocker).toBe(true);
 			expect(mockFs.existsSync).toHaveBeenCalledWith('/run/.containerenv');
 			expect(mockFs.readFileSync).not.toHaveBeenCalledWith('/proc/self/cgroup', 'utf8');
@@ -239,6 +230,7 @@ describe('InstanceSettings', () => {
 				mockFs.existsSync.mockReturnValueOnce(false);
 				mockFs.readFileSync.calledWith('/proc/self/cgroup', 'utf8').mockReturnValueOnce(str);
 
+				const settings = createInstanceSettings();
 				expect(settings.isDocker).toBe(true);
 				expect(mockFs.existsSync).toHaveBeenCalledWith('/.dockerenv');
 				expect(mockFs.readFileSync).toHaveBeenCalledWith('/proc/self/cgroup', 'utf8');
@@ -252,6 +244,7 @@ describe('InstanceSettings', () => {
 				mockFs.readFileSync.calledWith('/proc/self/cgroup', 'utf8').mockReturnValueOnce('');
 				mockFs.readFileSync.calledWith('/proc/self/mountinfo', 'utf8').mockReturnValueOnce(str);
 
+				const settings = createInstanceSettings();
 				expect(settings.isDocker).toBe(true);
 				expect(mockFs.existsSync).toHaveBeenCalledWith('/.dockerenv');
 				expect(mockFs.readFileSync).toHaveBeenCalledWith('/proc/self/cgroup', 'utf8');
@@ -263,6 +256,7 @@ describe('InstanceSettings', () => {
 			mockFs.existsSync.calledWith('/.dockerenv').mockReturnValueOnce(false);
 			mockFs.readFileSync.calledWith('/proc/self/cgroup', 'utf8').mockReturnValueOnce('');
 			mockFs.readFileSync.calledWith('/proc/self/mountinfo', 'utf8').mockReturnValueOnce('');
+			const settings = createInstanceSettings();
 			expect(settings.isDocker).toBe(false);
 		});
 
@@ -272,12 +266,14 @@ describe('InstanceSettings', () => {
 				throw new Error('File not found');
 			});
 
+			const settings = createInstanceSettings();
 			expect(settings.isDocker).toBe(false);
 		});
 
 		it('should cache the result of isDocker check', () => {
 			mockFs.existsSync.calledWith('/.dockerenv').mockReturnValueOnce(true);
 
+			const settings = createInstanceSettings();
 			expect(settings.isDocker).toBe(true);
 
 			mockFs.existsSync.mockClear();
diff --git a/packages/core/src/instance-settings/instance-settings.ts b/packages/core/src/instance-settings/instance-settings.ts
index 2a69d9b65b3..df453cba210 100644
--- a/packages/core/src/instance-settings/instance-settings.ts
+++ b/packages/core/src/instance-settings/instance-settings.ts
@@ -7,6 +7,7 @@ import { createHash, randomBytes } from 'crypto';
 import { ApplicationError, jsonParse, ALPHABET, toResult } from 'n8n-workflow';
 import { customAlphabet } from 'nanoid';
 import { chmodSync, existsSync, mkdirSync, readFileSync, statSync, writeFileSync } from 'node:fs';
+import os from 'node:os';
 import path from 'path';
 
 import { WorkerMissingEncryptionKey } from './worker-missing-encryption-key.error';
@@ -60,7 +61,7 @@ export class InstanceSettings {
 		const command = process.argv[2] as InstanceType;
 		this.instanceType = ['webhook', 'worker'].includes(command) ? command : 'main';
 
-		this.hostId = `${this.instanceType}-${nanoid()}`;
+		this.hostId = `${this.instanceType}-${this.isDocker ? os.hostname() : nanoid()}`;
 		this.settings = this.loadOrCreate();
 		this.instanceId = this.generateInstanceId();
 	}
@@ -76,12 +77,11 @@ export class InstanceSettings {
 	instanceRole: InstanceRole = 'unset';
 
 	/**
-	 * Transient ID of this n8n instance, for scaling mode.
-	 * Reset on restart. Do not confuse with `instanceId`.
+	 * ID of this n8n instance. Hostname-based when in Docker, or nanoID-based
+	 * otherwise (resets on restart). Do not confuse with `instanceId`.
 	 *
-	 * @example 'main-bnxa1riryKUNHtln'
-	 * @example 'worker-nDJR0FnSd2Vf6DB5'
-	 * @example 'webhook-jxQ7AO8IzxEtfW1F'
+	 * @example 'main-bnxa1riryKUNHtln' (local)
+	 * @example 'main-6bf523178bc6' (Docker)
 	 */
 	readonly hostId: string;