diff --git a/go.mod b/go.mod
index 7fd25e1a59..8b30717dcb 100644
--- a/go.mod
+++ b/go.mod
@@ -21,7 +21,7 @@ require (
 	golang.org/x/lint v0.0.0-20210508222113-6edffad5e616 // indirect
 	golang.org/x/net v0.0.0-20210614182718-04defd469f4e
 	golang.org/x/sys v0.0.0-20210616094352-59db8d763f22
-	golang.org/x/tools v0.1.3 // indirect
+	golang.org/x/tools v0.1.5 // indirect
 	google.golang.org/grpc v1.29.0
 	gopkg.in/natefinch/lumberjack.v2 v2.0.0
 	k8s.io/api v0.18.6
diff --git a/pkg/awsutils/awsutils.go b/pkg/awsutils/awsutils.go
index 63fbeab712..59280f6fc1 100644
--- a/pkg/awsutils/awsutils.go
+++ b/pkg/awsutils/awsutils.go
@@ -1353,7 +1353,7 @@ func (cache *EC2InstanceMetadataCache) AllocIPAddresses(eniID string, numIPs int
 		}
 		log.Errorf("Failed to allocate a private IP/Prefix addresses on ENI %v: %v", eniID, err)
 		awsAPIErrInc("AssignPrivateIpAddresses", err)
-		return errors.Wrap(err, "allocate IP/Prefix address: failed to allocate a private IP/Prefix address")
+		return err
 	}
 	if output != nil {
 		if cache.enableIpv4PrefixDelegation {
diff --git a/pkg/ipamd/ipamd.go b/pkg/ipamd/ipamd.go
index 42219be3da..3249adf071 100644
--- a/pkg/ipamd/ipamd.go
+++ b/pkg/ipamd/ipamd.go
@@ -28,6 +28,7 @@ import (
 	"sigs.k8s.io/controller-runtime/pkg/client"
 
 	"github.com/aws/aws-sdk-go/aws"
+	"github.com/aws/aws-sdk-go/aws/awserr"
 	"github.com/aws/aws-sdk-go/service/ec2"
 	"github.com/pkg/errors"
 	"github.com/prometheus/client_golang/prometheus"
@@ -136,6 +137,12 @@ const (
 	envWarmPrefixTarget     = "WARM_PREFIX_TARGET"
 	defaultWarmPrefixTarget = 0
 
+	//insufficientCidrErrorCooldown is the amount of time reconciler will wait before trying to fetch
+	//more IPs/prefixes for an ENI. With InsufficientCidr we know the subnet doesn't have enough IPs so
+	//instead of retrying every 5s which would lead to increase in EC2 AllocIPAddress calls, we wait for
+	//120 seconds for a retry.
+	insufficientCidrErrorCooldown = 120 * time.Second
+
 	// envManageUntaggedENI is used to determine if untagged ENIs should be managed or unmanaged
 	envManageUntaggedENI = "MANAGE_UNTAGGED_ENI"
 
@@ -228,6 +235,7 @@ type IPAMContext struct {
 	enablePodENI               bool
 	myNodeName                 string
 	enableIpv4PrefixDelegation bool
+	lastInsufficientCidrError  time.Time
 	enableManageUntaggedMode   bool
 }
 
@@ -311,6 +319,20 @@ func prometheusRegister() {
 	}
 }
 
+// containsInsufficientCidrBlocksError returns whether exceeds ENI's IP address limit
+func containsInsufficientCidrBlocksError(err error) bool {
+	var awsErr awserr.Error
+	if errors.As(err, &awsErr) {
+		return awsErr.Code() == "InsufficientCidrBlocks"
+	}
+	return false
+}
+
+// inInsufficientCidrCoolingPeriod checks whether IPAMD is in insufficientCidrErrorCooldown
+func (c *IPAMContext) inInsufficientCidrCoolingPeriod() bool {
+	return time.Since(c.lastInsufficientCidrError) <= insufficientCidrErrorCooldown
+}
+
 // New retrieves IP address usage information from Instance MetaData service and Kubelet
 // then initializes IP address pool data store
 func New(rawK8SClient client.Client, cachedK8SClient client.Client) (*IPAMContext, error) {
@@ -517,6 +539,11 @@ func (c *IPAMContext) nodeInit() error {
 		if err == nil && increasedPool {
 			c.updateLastNodeIPPoolAction()
 		} else if err != nil {
+			if containsInsufficientCidrBlocksError(err) {
+				log.Errorf("Unable to attach IPs/Prefixes for the ENI, subnet doesn't seem to have enough IPs/Prefixes. Consider using new subnet or carve a reserved range using create-subnet-cidr-reservation")
+				c.lastInsufficientCidrError = time.Now()
+				return nil
+			}
 			return err
 		}
 	}
@@ -712,9 +739,19 @@ func (c *IPAMContext) increaseDatastorePool(ctx context.Context) {
 		return
 	}
 	// Try to add more Cidrs to existing ENIs first.
+	if c.inInsufficientCidrCoolingPeriod() {
+		log.Debugf("Recently we had InsufficientCidr error hence will wait for %v before retrying", insufficientCidrErrorCooldown)
+		return
+	}
+
 	increasedPool, err := c.tryAssignCidrs()
 	if err != nil {
 		log.Errorf(err.Error())
+		if containsInsufficientCidrBlocksError(err) {
+			log.Errorf("Unable to attach IPs/Prefixes for the ENI, subnet doesn't seem to have enough IPs/Prefixes. Consider using new subnet or carve a reserved range using create-subnet-cidr-reservation")
+			c.lastInsufficientCidrError = time.Now()
+			return
+		}
 	}
 	if increasedPool {
 		c.updateLastNodeIPPoolAction()
@@ -781,6 +818,11 @@ func (c *IPAMContext) tryAllocateENI(ctx context.Context) error {
 		log.Warnf("Failed to allocate %d IP addresses on an ENI: %v", resourcesToAllocate, err)
 		// Continue to process the allocated IP addresses
 		ipamdErrInc("increaseIPPoolAllocIPAddressesFailed")
+		if containsInsufficientCidrBlocksError(err) {
+			log.Errorf("Unable to attach IPs/Prefixes for the ENI, subnet doesn't seem to have enough IPs/Prefixes. Consider using new subnet or carve a reserved range using create-subnet-cidr-reservation")
+			c.lastInsufficientCidrError = time.Now()
+			return err
+		}
 	}
 
 	eniMetadata, err := c.awsClient.WaitForENIAndIPsAttached(eni, resourcesToAllocate)
diff --git a/scripts/entrypoint.sh b/scripts/entrypoint.sh
index 3c88a86e7c..18a9fa1730 100755
--- a/scripts/entrypoint.sh
+++ b/scripts/entrypoint.sh
@@ -37,7 +37,7 @@ log_in_json()
 
 unsupported_prefix_target_conf()
 {
-   if [ "${WARM_PREFIX_TARGET}" <= "0" ] && [ "${WARM_IP_TARGET}" <= "0" ] && [ "${MINIMUM_IP_TARGET}" <= "0" ];then
+   if [ "${WARM_PREFIX_TARGET}" -le "0" ] && [ "${WARM_IP_TARGET}" -le "0" ] && [ "${MINIMUM_IP_TARGET}" -le "0" ];then
         true
    else
         false