diff --git a/src/core/lwt_seq.ml b/src/core/lwt_seq.ml
index 543dac1d1..ddfef7d37 100644
--- a/src/core/lwt_seq.ml
+++ b/src/core/lwt_seq.ml
@@ -267,10 +267,16 @@ let iter_n ?(max_concurrency = 1) f seq =
   loop [] max_concurrency (fun () -> Lwt.apply seq ())
 
 let rec unfold f u () =
+  match f u with
+  | None -> return_nil
+  | Some (x, u') -> Lwt.return (Cons (x, unfold f u'))
+  | exception exc -> Lwt.fail exc
+
+let rec unfold_lwt f u () =
   let* x = f u in
   match x with
   | None -> return_nil
-  | Some (x, u') -> Lwt.return (Cons (x, unfold f u'))
+  | Some (x, u') -> Lwt.return (Cons (x, unfold_lwt f u'))
 
 let rec of_list = function
   | [] -> empty
diff --git a/src/core/lwt_seq.mli b/src/core/lwt_seq.mli
index 6add5f4c6..3b7e30165 100644
--- a/src/core/lwt_seq.mli
+++ b/src/core/lwt_seq.mli
@@ -107,7 +107,8 @@ val iter_n : ?max_concurrency:int -> ('a -> unit Lwt.t) -> 'a t -> unit Lwt.t
   @param max_concurrency defaults to [1].
   @raise Invalid_argument if [max_concurrency < 1]. *)
 
-val unfold : ('b -> ('a * 'b) option Lwt.t) -> 'b -> 'a t
+val unfold : ('b -> ('a * 'b) option) -> 'b -> 'a t
+val unfold_lwt : ('b -> ('a * 'b) option Lwt.t) -> 'b -> 'a t
 (** Build a sequence from a step function and an initial value.
   [unfold f u] returns [empty] if the promise [f u] resolves to [None],
   or [fun () -> Lwt.return (Cons (x, unfold f y))] if the promise [f u] resolves
diff --git a/test/core/test_lwt_seq.ml b/test/core/test_lwt_seq.ml
index 5f1b6a616..20b787cfb 100644
--- a/test/core/test_lwt_seq.ml
+++ b/test/core/test_lwt_seq.ml
@@ -9,12 +9,6 @@ open Test
 
 let l =  [1; 2; 3; 4; 5]
 let a = Lwt_seq.of_list l
-let b =
-   Lwt_seq.unfold
-     (function
-      | [] -> let+ () = Lwt.pause () in None
-      | x::xs -> let+ () = Lwt.pause () in Some (x, xs))
-     l
 let rec pause n =
    if n <= 0 then
       Lwt.return_unit
@@ -22,6 +16,12 @@ let rec pause n =
       let* () = Lwt.pause () in
       pause (n - 1)
 let pause n = pause (n mod 5)
+let b =
+   Lwt_seq.unfold_lwt
+     (function
+      | [] -> let+ () = pause 2 in None
+      | x::xs -> let+ () = pause (x+2) in Some (x, xs))
+     l
 
 let suite_base = suite "lwt_seq" [
   test "fold_left" begin fun () ->
@@ -134,8 +134,7 @@ let suite_base = suite "lwt_seq" [
 
   test "unfold" begin fun () ->
     let range first last =
-      let step i = if i > last then Lwt.return_none
-                   else Lwt.return_some (i, succ i) in
+      let step i = if i > last then None else Some (i, succ i) in
       Lwt_seq.unfold step first
     in
     let* a = Lwt_seq.to_list (range 1 3) in
@@ -144,6 +143,20 @@ let suite_base = suite "lwt_seq" [
       ([] = b)
   end;
 
+  test "unfold_lwt" begin fun () ->
+    let range first last =
+      let step i =
+         if i > last then Lwt.return_none else Lwt.return_some (i, succ i)
+      in
+      Lwt_seq.unfold_lwt step first
+    in
+    let* a = Lwt_seq.to_list (range 1 3) in
+    let+ b = Lwt_seq.to_list (range 1 0) in
+      ([1;2;3] = a) &&
+      ([] = b)
+  end;
+
+
   test "fold-into-exception-from-of-seq" begin fun () ->
     let fail = fun () -> failwith "XXX" in
     let seq = fun () -> Seq.Cons (1, (fun () -> Seq.Cons (2, fail))) in