diff --git a/stream_proxy_half_close.t b/stream_proxy_half_close.t
new file mode 100644
index 0000000..a265643
--- /dev/null
+++ b/stream_proxy_half_close.t
@@ -0,0 +1,117 @@
+#!/usr/bin/perl
+
+# (C) Sergey Kandaurov
+# (C) Nginx, Inc.
+
+# Tests for stream proxy_half_close directive.
+
+###############################################################################
+
+use warnings;
+use strict;
+
+use Test::More;
+
+use IO::Select;
+
+BEGIN { use FindBin; chdir($FindBin::Bin); }
+
+use lib 'lib';
+use Test::Nginx;
+
+###############################################################################
+
+select STDERR; $| = 1;
+select STDOUT; $| = 1;
+
+my $t = Test::Nginx->new()->has(qw/stream/);
+
+$t->write_file_expand('nginx.conf', <<'EOF');
+
+%%TEST_GLOBALS%%
+
+daemon off;
+
+events {
+}
+
+stream {
+    %%TEST_GLOBALS_STREAM%%
+
+    server {
+        listen      127.0.0.1:8080;
+        proxy_pass  127.0.0.1:8081;
+
+        proxy_half_close  on;
+    }
+}
+
+EOF
+
+$t->try_run('no proxy_half_close')->plan(2);
+
+###############################################################################
+
+my ($s, $u) = pair(8080, 8081);
+shutdown($u, 1);
+is(proxy($s, $u, 'SEE'), 'SEE', 'half close upstream');
+
+($s, $u) = pair(8080, 8081);
+shutdown($s, 1);
+is(proxy($u, $s, 'SEE'), 'SEE', 'half close client');
+
+###############################################################################
+
+sub pair {
+	my ($server, $backend) = @_;
+
+	my $listen = IO::Socket::INET->new(
+		LocalHost => '127.0.0.1:' . port($backend),
+		Listen => 5,
+		Reuse => 1,
+	)
+		or die "Can't listen on $server: $!\n";
+
+	my $connect = IO::Socket::INET->new(
+		Proto => 'tcp',
+		PeerHost => '127.0.0.1:' . port($server),
+	)
+		or die "Can't connect to $server: $!\n";
+
+	my $accept = $listen->accept() if IO::Select->new($listen)->can_read(3);
+
+	return $connect, $accept;
+}
+
+sub proxy {
+	my ($from, $to, $msg) = @_;
+	proxy_from($from, $msg);
+	return proxy_to($to);
+}
+
+sub proxy_from {
+	my ($s, $msg) = @_;
+
+	local $SIG{PIPE} = 'IGNORE';
+
+	while (IO::Select->new($s)->can_write(5)) {
+		my $n = $s->syswrite($msg);
+		log_out(substr($msg, 0, $n));
+		last unless $n;
+
+		$msg = substr($msg, $n);
+		last unless length $msg;
+	}
+}
+
+sub proxy_to {
+	my ($s) = @_;
+	my $buf;
+
+	$s->sysread($buf, 1024) if IO::Select->new($s)->can_read(5);
+
+	log_in($buf);
+	return $buf;
+}
+
+###############################################################################