diff --git a/NEWS.md b/NEWS.md
index 1f595bb41..fa4c464cc 100644
--- a/NEWS.md
+++ b/NEWS.md
@@ -1,5 +1,6 @@
 # testthat (development version)
 
+* `expect_setequal()` correctly identifies what is missing where (#1962).
 * `expect_true()` and `expect_false()` give better errors if `actual` isn't a vector (#1996).
 * `expect_no_*()` expectations no longer incorrectly emit a passing test result if they in fact fail (#1997).
 * Require the latest version of waldo (0.6.0) in order to get the latest goodies (#1955).
diff --git a/R/expect-setequal.R b/R/expect-setequal.R
index d710a1ac7..cfca84654 100644
--- a/R/expect-setequal.R
+++ b/R/expect-setequal.R
@@ -35,16 +35,16 @@ expect_setequal <- function(object, expected) {
     warn("expect_setequal() ignores names")
   }
 
-  act_miss <- !act$val %in% exp$val
-  exp_miss <- !exp$val %in% act$val
+  act_miss <- setdiff(act$val, exp$val)
+  exp_miss <- setdiff(exp$val, act$val)
 
-  if (any(exp_miss) || any(act_miss)) {
+  if (length(exp_miss) || length(act_miss)) {
     fail(paste0(
       act$lab, " (`actual`) and ", exp$lab, " (`expected`) don't have the same values.\n",
-      if (any(act_miss))
-        paste0("* Only in `expected`: ",  values(act$val[act_miss]), "\n"),
-      if (any(exp_miss))
-        paste0("* Only in `actual`: ",  values(exp$val[exp_miss]), "\n")
+      if (length(act_miss))
+        paste0("* Only in `actual`: ", values(act_miss), "\n"),
+      if (length(exp_miss))
+        paste0("* Only in `expected`: ", values(exp_miss), "\n")
     ))
   } else {
     succeed()
diff --git a/tests/testthat/_snaps/expect-setequal.md b/tests/testthat/_snaps/expect-setequal.md
index 1225d9914..3ea8247ad 100644
--- a/tests/testthat/_snaps/expect-setequal.md
+++ b/tests/testthat/_snaps/expect-setequal.md
@@ -1,26 +1,33 @@
 # useful message on failure
 
+    "actual" (`actual`) and "expected" (`expected`) don't have the same values.
+    * Only in `actual`: "actual"
+    * Only in `expected`: "expected"
+    
+
+---
+
     1:2 (`actual`) and 2 (`expected`) don't have the same values.
-    * Only in `expected`: 1
+    * Only in `actual`: 1
     
 
 ---
 
     2 (`actual`) and 2:3 (`expected`) don't have the same values.
-    * Only in `actual`: 3
+    * Only in `expected`: 3
     
 
 ---
 
     1:2 (`actual`) and 2:3 (`expected`) don't have the same values.
-    * Only in `expected`: 1
-    * Only in `actual`: 3
+    * Only in `actual`: 1
+    * Only in `expected`: 3
     
 
 # truncates long vectors
 
     1:2 (`actual`) and 1:50 (`expected`) don't have the same values.
-    * Only in `actual`: 3, 4, 5, 6, 7, 8, 9, 10, 11, ...
+    * Only in `expected`: 3, 4, 5, 6, 7, 8, 9, 10, 11, ...
     
 
 # expect_contains() gives useful message on failure
diff --git a/tests/testthat/test-expect-setequal.R b/tests/testthat/test-expect-setequal.R
index b4de30800..6966822ec 100644
--- a/tests/testthat/test-expect-setequal.R
+++ b/tests/testthat/test-expect-setequal.R
@@ -24,6 +24,8 @@ test_that("error for non-vectors", {
 })
 
 test_that("useful message on failure", {
+  expect_snapshot_failure(expect_setequal("actual", "expected"))
+
   expect_snapshot_failure(expect_setequal(1:2, 2))
   expect_snapshot_failure(expect_setequal(2, 2:3))
   expect_snapshot_failure(expect_setequal(1:2, 2:3))
@@ -112,4 +114,3 @@ test_that("expect_in() gives useful message on failure", {
   expect_snapshot_failure(expect_in(x1, x2))
   expect_snapshot_failure(expect_in(x1, x3))
 })
-