diff --git a/sqlmodel/main.py b/sqlmodel/main.py
@@ -589,12 +589,12 @@ def __new__(
         }
 
         def get_config(name: str) -> Any:
-            config_class_value = new_cls.model_config.get(name, Undefined)
-            if config_class_value is not Undefined:
-                return config_class_value
             kwarg_value = kwargs.get(name, Undefined)
             if kwarg_value is not Undefined:
                 return kwarg_value
+            config_class_value = new_cls.model_config.get(name, Undefined)
+            if config_class_value is not Undefined:
+                return config_class_value
             return Undefined
 
         config_table = get_config("table")
@@ -618,10 +618,15 @@ def get_config(name: str) -> Any:
         if config_registry is not Undefined:
             config_registry = cast(registry, config_registry)
             # If it was passed by kwargs, ensure it's also set in config
-            new_cls.model_config["registry"] = config_table
-            setattr(new_cls, "_sa_registry", config_registry)  # noqa: B010
-            setattr(new_cls, "metadata", config_registry.metadata)  # noqa: B010
-            setattr(new_cls, "__abstract__", True)  # noqa: B010
+            new_cls.model_config["registry"] = config_registry
+            # Only set up the registry attributes when explicitly passed
+            # as a kwarg on this class, not when inherited from a parent.
+            # Setting __abstract__ on subclasses that merely inherit the
+            # registry would prevent SQLAlchemy from instrumenting them.
+            if "registry" in kwargs:
+                setattr(new_cls, "_sa_registry", config_registry)  # noqa: B010
+                setattr(new_cls, "metadata", config_registry.metadata)  # noqa: B010
+                setattr(new_cls, "__abstract__", True)  # noqa: B010
         return new_cls
 
     # Override SQLAlchemy, allow both SQLAlchemy and plain Pydantic models

diff --git a/tests/test_registry.py b/tests/test_registry.py
@@ -0,0 +1,43 @@
+from sqlalchemy.orm import registry
+from sqlmodel import Field, Session, SQLModel, create_engine, select
+
+
+def test_custom_registry_stored_in_model_config(clear_sqlmodel):
+    """Test that passing a custom registry via kwargs stores the registry
+    (not the table config value) in model_config['registry'].
+
+    This is a regression test for a copy-paste bug where model_config['registry']
+    was incorrectly set to the value of config_table instead of config_registry.
+    """
+    custom_registry = registry()
+
+    class Base(SQLModel, registry=custom_registry):
+        pass
+
+    class Hero(Base, table=True):
+        id: int | None = Field(default=None, primary_key=True)
+        name: str
+
+    # The registry stored in model_config should be the custom registry,
+    # not a bool (which config_table would be)
+    assert Base.model_config.get("registry") is custom_registry
+    assert isinstance(Base.model_config.get("registry"), registry)
+
+    # Verify the custom registry is actually functional
+    engine = create_engine("sqlite://")
+    custom_registry.metadata.create_all(engine)
+
+    with Session(engine) as session:
+        hero = Hero(name="Spider-Boy")
+        session.add(hero)
+        session.commit()
+        session.refresh(hero)
+        assert hero.id is not None
+        assert hero.name == "Spider-Boy"
+
+    with Session(engine) as session:
+        heroes = session.exec(select(Hero)).all()
+        assert len(heroes) == 1
+        assert heroes[0].name == "Spider-Boy"
+
+    custom_registry.dispose()