How to install macOS on a encrypted, journaled filesystem?

I just wiped my 500GB disk on my Mac Mini (2011 model) to freshly reinstall macOS Sierra.

1. I restarted the system, pressed CMD+R to get into recovery mode and went into disk utility.
2. I erased the macOS partition and formatted it with journaled and encrypted file-system. Picked a password, and good.
3. I quit the disk utility and selected 'Install macOS'.

This told me it will check eligibility of my device and due to my encrypted disk it will ask for the password during installation. And it did. I entered the password and the process continued until at some point it aborted with the following message:

macOS could not be installed on your computer.

Storage system verify or repair failed.

Now my only option is reboot and remove the encryption via disk utility. I was not able to install macOS onto a fully encrypted disk. Is this desired behaviour? How to install macOS on a encrypted, journaled file-system?

I'm usually installing my Linux systems on fully encrypted disks, thus I am wondering whether this is also possible with macOS Sierra.

I know you have a working answer already, but I thought to share my experience anyway, only updated for High Sierra and using Apple's new file system APFS.

My motivation: I was driven by the (constantly varying) 6-14 hour estimate for FileVault to finish on a new install with no additional user data.

So this is what I did to install macOS on an already-encrypted filesystem - much like yours:

1. Create a bootable macOS installer
2. Erase and format as APFS (Encrypted)
3. Install High Sierra

Pros:

1. < 10 mins to encrypt by Disk Utility? (possibly less, I didn't monitor closely)
2. FileVault already enabled.

One main difference is that you supply a password earlier when formatting with Disk Utility, rather than being given one (the Recovery Key) when enabling FileVault post-install.

Hope this helps someone.

I just did this so I know it works:

1. Format the target disk "Mac OS Extended (Journaled)" - but not encrypted.
2. Install macOS Sierra on the fresh, unencrypted disk.
3. Finally, turn on disk encryption (called FileVault). This can be done near the end of installing Sierra (it prompts you if you want encryption), or after the install is done. Either way is fine.

If you do it in this sequence then everything works.

A few other thoughts:

• I would also recommend to format it the disk as a single partition. I have had issues with disks formatted with multiple partitions when using encryption on one or more of the partitions. Perhaps that bug has been fixed now, but I don't know so I would not risk it.
• After you enable encryption, wait for the encryption process to finish before installing other software or making big changes. You can see the progress of the disk encryption by going to System Preferences -> Security & Privacy -> FileVault. The encryption process is disk intensive so it is best to just let if finish before doing other disk intensive things.
• For non boot partitions, it is fine to format them as encrypted - e.g. Mac OS Extended (Journaled, Encrypted). It is only bootable partitions that need to follow the above sequence to avoid trouble.

A thumb drive installer solved it for me. Thanks to comment by Stuart H.

Download the macOS Sierra installer.

Type (or copy and paste) this command into Terminal, replacing Untitled with the name of your drive, then press Enter:

sudo /Applications/Install\ macOS\ Sierra.app/Contents/Resources/createinstallmedia --volume /Volumes/Untitled --applicationpath /Applications/Install\ macOS\ Sierra.app --nointeraction && say Done

Hold option key at power up & select attached thumb drive device to boot.

As necessary, run Disk Utility to erase & format the destination drive to the journaled, encrypted option and then proceed with install to the destination drive.

Ref: http://lifehacker.com/how-to-make-a-bootable-macos-sierra-usb-flash-drive-1786853248

I've had this error happen when the partition previously contained a FileVault-encrypted macOS installation. Reformatting as encrypted in Disk Utility and reinstalling macOS fails shortly after entering the disk password after the reboot, as you described.

However, I found that it works if you format as unencrypted, install macOS, then go back to recovery, reformat as encrypted, and install again.

It's sort of an awkward workaround, and there might be a simpler solution, but that's what worked for me. My guess is that there's some information about the old FileVault setup in NVRAM or something that doesn't get cleared out when you reformat with Disk Utility, and it confuses the newly-installed system that's booting from a partition with different encryption settings. Booting from an unencrypted partition apparently clears out that old FileVault data, which paves the way for a new encrypted installation later.