diff --git a/src/liblzma/simple/simple_coder.c b/src/liblzma/simple/simple_coder.c
index 9e7bc289..a02b039a 100644
--- a/src/liblzma/simple/simple_coder.c
+++ b/src/liblzma/simple/simple_coder.c
@@ -107,7 +107,7 @@ simple_code(lzma_coder *coder, lzma_allocator *allocator,
 	// filtered if the buffer sizes used by the application are reasonable.
 	const size_t out_avail = out_size - *out_pos;
 	const size_t buf_avail = coder->size - coder->pos;
-	if (out_avail > buf_avail) {
+	if (out_avail > buf_avail || buf_avail == 0) {
 		// Store the old position so that we know from which byte
 		// to start filtering.
 		const size_t out_start = *out_pos;
diff --git a/tests/Makefile.am b/tests/Makefile.am
index 03bf34c2..c4e17ed1 100644
--- a/tests/Makefile.am
+++ b/tests/Makefile.am
@@ -34,7 +34,8 @@ check_PROGRAMS = \
 	test_stream_flags \
 	test_filter_flags \
 	test_block_header \
-	test_index
+	test_index \
+	test_bcj_exact_size
 
 TESTS = \
 	test_check \
@@ -42,6 +43,7 @@ TESTS = \
 	test_filter_flags \
 	test_block_header \
 	test_index \
+	test_bcj_exact_size \
 	test_files.sh \
 	test_compress.sh
 
diff --git a/tests/test_bcj_exact_size.c b/tests/test_bcj_exact_size.c
new file mode 100644
index 00000000..cbd93405
--- /dev/null
+++ b/tests/test_bcj_exact_size.c
@@ -0,0 +1,112 @@
+///////////////////////////////////////////////////////////////////////////////
+//
+/// \file       test_bcj_exact_size.c
+/// \brief      Tests BCJ decoding when the output size is known
+///
+/// These tests fail with XZ Utils 5.0.3 and earlier.
+//
+//  Author:     Lasse Collin
+//
+//  This file has been put into the public domain.
+//  You can do whatever you want with this file.
+//
+///////////////////////////////////////////////////////////////////////////////
+
+#include "tests.h"
+
+
+/// Something to be compressed
+static const uint8_t in[16] = "0123456789ABCDEF";
+
+/// in[] after compression
+static uint8_t compressed[1024];
+static size_t compressed_size = 0;
+
+/// Output buffer for decompressing compressed[]
+static uint8_t out[sizeof(in)];
+
+
+static void
+compress(void)
+{
+	// Compress with PowerPC BCJ and LZMA2. PowerPC BCJ is used because
+	// it has fixed 4-byte alignment which makes triggering the potential
+	// bug easy.
+	lzma_options_lzma opt_lzma2;
+	succeed(lzma_lzma_preset(&opt_lzma2, 0));
+
+	lzma_filter filters[3] = {
+		{ .id = LZMA_FILTER_POWERPC, .options = NULL },
+		{ .id = LZMA_FILTER_LZMA2, .options = &opt_lzma2 },
+		{ .id = LZMA_VLI_UNKNOWN, .options = NULL },
+	};
+
+	expect(lzma_stream_buffer_encode(filters, LZMA_CHECK_CRC32, NULL,
+			in, sizeof(in),
+			compressed, &compressed_size, sizeof(compressed))
+			== LZMA_OK);
+}
+
+
+static void
+decompress(void)
+{
+	lzma_stream strm = LZMA_STREAM_INIT;
+	expect(lzma_stream_decoder(&strm, 10 << 20, 0) == LZMA_OK);
+
+	strm.next_in = compressed;
+	strm.next_out = out;
+
+	while (true) {
+		if (strm.total_in < compressed_size)
+			strm.avail_in = 1;
+
+		const lzma_ret ret = lzma_code(&strm, LZMA_RUN);
+		if (ret == LZMA_STREAM_END) {
+			expect(strm.total_in == compressed_size);
+			expect(strm.total_out == sizeof(in));
+			return;
+		}
+
+		expect(ret == LZMA_OK);
+
+		if (strm.total_out < sizeof(in))
+			strm.avail_out = 1;
+	}
+}
+
+
+static void
+decompress_empty(void)
+{
+	// An empty file with one Block using PowerPC BCJ and LZMA2.
+	static const uint8_t empty_bcj_lzma2[] = {
+		0xFD, 0x37, 0x7A, 0x58, 0x5A, 0x00, 0x00, 0x01,
+		0x69, 0x22, 0xDE, 0x36, 0x02, 0x01, 0x05, 0x00,
+		0x21, 0x01, 0x00, 0x00, 0x7F, 0xE0, 0xF1, 0xC8,
+		0x00, 0x00, 0x00, 0x00, 0x00, 0x00, 0x00, 0x00,
+		0x00, 0x01, 0x11, 0x00, 0x3B, 0x96, 0x5F, 0x73,
+		0x90, 0x42, 0x99, 0x0D, 0x01, 0x00, 0x00, 0x00,
+		0x00, 0x01, 0x59, 0x5A
+	};
+
+	// Decompress without giving any output space.
+	uint64_t memlimit = 1 << 20;
+	size_t in_pos = 0;
+	size_t out_pos = 0;
+	expect(lzma_stream_buffer_decode(&memlimit, 0, NULL,
+			empty_bcj_lzma2, &in_pos, sizeof(empty_bcj_lzma2),
+			out, &out_pos, 0) == LZMA_OK);
+	expect(in_pos == sizeof(empty_bcj_lzma2));
+	expect(out_pos == 0);
+}
+
+
+extern int
+main(void)
+{
+	compress();
+	decompress();
+	decompress_empty();
+	return 0;
+}