diff --git a/Src/exec.c b/Src/exec.c
index d8501ca68..43df8211a 100644
--- a/Src/exec.c
+++ b/Src/exec.c
@@ -5932,15 +5932,6 @@ doshfunc(Shfunc shfunc, LinkList doshargs, int noreturnval)
 	     * This function is forced to return.
 	     */
 	    retflag = 0;
-	    /*
-	     * The calling function isn't necessarily forced to return,
-	     * but it should be made sensitive to ERR_EXIT and
-	     * ERR_RETURN as the assumptions we made at the end of
-	     * constructs within this function no longer apply.  If
-	     * there are cases where this is not true, they need adding
-	     * to C03traps.ztst.
-	     */
-	    this_noerrexit = 0;
 	    breaks = funcsave->breaks;
 	}
 	freearray(pparams);
@@ -6010,6 +6001,7 @@ doshfunc(Shfunc shfunc, LinkList doshargs, int noreturnval)
 	    trap_return++;
 	ret = lastval;
 	noerrexit = funcsave->noerrexit;
+	this_noerrexit = 0;
 	if (noreturnval) {
 	    lastval = funcsave->lastval;
 	    numpipestats = funcsave->numpipestats;
diff --git a/Test/C03traps.ztst b/Test/C03traps.ztst
index 08e24a32e..a8880673f 100644
--- a/Test/C03traps.ztst
+++ b/Test/C03traps.ztst
@@ -742,6 +742,15 @@ F:Must be tested with a top-level script rather than source or function
 0:ERR_EXIT not triggered by "false && true"
 >OK
 
+  (setopt err_exit
+  fn() {
+    false && true
+  }
+  fn
+  print OK
+  )
+1:ERR_EXIT not triggered by "false && true" but by return from fn
+
   (setopt err_exit
   for x in y; do
     false && true
@@ -751,6 +760,17 @@ F:Must be tested with a top-level script rather than source or function
 0:ERR_EXIT not triggered by status 1 at end of for
 >OK
 
+  (setopt err_exit
+  fn() {
+    for x in y; do
+      false && true
+    done
+  }
+  fn
+  print OK
+  )
+1:ERR_EXIT not triggered by status 1 at end of for but by return from fn
+
   (setopt err_exit
   repeat 1; do
     false && true
@@ -760,6 +780,17 @@ F:Must be tested with a top-level script rather than source or function
 0:ERR_EXIT not triggered by status 1 at end of repeat
 >OK
 
+  (setopt err_exit
+  fn() {
+    repeat 1; do
+      false && true
+    done
+  }
+  fn
+  print OK
+  )
+1:ERR_EXIT not triggered by status 1 at end of repeat but by return from fn
+
   (setopt err_exit
   if true; then
     false && true
@@ -769,6 +800,17 @@ F:Must be tested with a top-level script rather than source or function
 0:ERR_EXIT not triggered by status 1 at end of if
 >OK
 
+  (setopt err_exit
+  fn() {
+    if true; then
+      false && true
+    fi
+  }
+  fn
+  print OK
+  )
+1:ERR_EXIT not triggered by status 1 at end of if but by return from fn
+
   (setopt err_exit
   loop=true
   while print COND; $loop; do
@@ -782,6 +824,21 @@ F:Must be tested with a top-level script rather than source or function
 >COND
 >OK
 
+  (setopt err_exit
+  fn() {
+    loop=true
+    while print COND; $loop; do
+      loop=false
+      false && true
+    done
+  }
+  fn
+  print OK
+  )
+1:ERR_EXIT not triggered by status 1 at end of while but by return from fn
+>COND
+>COND
+
   (setopt err_exit
   {
     false && true
@@ -794,6 +851,20 @@ F:Must be tested with a top-level script rather than source or function
 >ALWAYS
 >OK
 
+  (setopt err_exit
+  fn() {
+    {
+      false && true
+    } always {
+      print ALWAYS
+    }
+  }
+  fn
+  print OK
+  )
+1:ERR_EXIT not triggered by status 1 at end of always but by return from fn
+>ALWAYS
+
   (setopt err_exit
   {
     false && true
@@ -803,6 +874,17 @@ F:Must be tested with a top-level script rather than source or function
 0:ERR_EXIT not triggered by status 1 at end of { }
 >OK
 
+  (setopt err_exit
+  fn() {
+    {
+      false && true
+    }
+  }
+  fn
+  print OK
+  )
+1:ERR_EXIT not triggered by status 1 at end of { } but by return from fn
+
   unsetopt err_exit err_return
   (setopt err_exit
   for x in y; do