This paper proposes a network-aware macroblock (MB) coding mode decision method, which is both error resilient and coding efficient. This method differs from traditional mode decision methods since MB mode decisions are made by simultaneously taking into account: i) their rate-distortion (RD) cost and also ii) their impact on error resilience by considering feedback information from the underlying network regarding current error characteristics. By doing so, the amount of Intra coded MBs can be varied to better suit, in a cost efficient way, the current state of the network and, therefore, further improve the decoded video quality for a given packet loss rate. The proposed approach outperforms a network-aware version of the H.264/AVC reference software with cyclic MB Intra refresh, for typical test sequences encoded at various bit rates and for several error conditions in terms of packet loss rate.