diff --git a/tests/Cargo.toml b/tests/Cargo.toml
index e05fbd1f6e..3f7f55f4c1 100644
--- a/tests/Cargo.toml
+++ b/tests/Cargo.toml
@@ -9,7 +9,7 @@ publish = false
 
 [dev-dependencies]
 beef = { version = "0.5.1", features = ["impl_serde"] }
-futures-channel = { version = "0.3.14", default-features = false }
+futures = { version = "0.3.14", default-features = false, features = ["std"] }
 jsonrpsee = { path = "../jsonrpsee", features = ["full"] }
 tokio = { version = "1", features = ["full"] }
 serde_json = "1"
diff --git a/tests/tests/helpers.rs b/tests/tests/helpers.rs
index 860ac3278d..5af9073bcd 100644
--- a/tests/tests/helpers.rs
+++ b/tests/tests/helpers.rs
@@ -24,9 +24,10 @@
 // IN CONNECTION WITH THE SOFTWARE OR THE USE OR OTHER
 // DEALINGS IN THE SOFTWARE.
 
-use futures_channel::oneshot;
+use futures::channel::oneshot;
 use jsonrpsee::{
 	http_server::HttpServerBuilder,
+	types::Error,
 	ws_server::{WsServerBuilder, WsStopHandle},
 	RpcModule,
 };
@@ -47,7 +48,9 @@ pub async fn websocket_server_with_subscription() -> (SocketAddr, WsStopHandle)
 		module
 			.register_subscription("subscribe_hello", "unsubscribe_hello", |_, mut sink, _| {
 				std::thread::spawn(move || loop {
-					let _ = sink.send(&"hello from subscription");
+					if let Err(Error::SubscriptionClosed(_)) = sink.send(&"hello from subscription") {
+						break;
+					}
 					std::thread::sleep(Duration::from_millis(50));
 				});
 				Ok(())
@@ -57,7 +60,9 @@ pub async fn websocket_server_with_subscription() -> (SocketAddr, WsStopHandle)
 		module
 			.register_subscription("subscribe_foo", "unsubscribe_foo", |_, mut sink, _| {
 				std::thread::spawn(move || loop {
-					let _ = sink.send(&1337);
+					if let Err(Error::SubscriptionClosed(_)) = sink.send(&1337) {
+						break;
+					}
 					std::thread::sleep(Duration::from_millis(100));
 				});
 				Ok(())
@@ -69,7 +74,9 @@ pub async fn websocket_server_with_subscription() -> (SocketAddr, WsStopHandle)
 				let mut count: usize = params.one()?;
 				std::thread::spawn(move || loop {
 					count = count.wrapping_add(1);
-					let _ = sink.send(&count);
+					if let Err(Error::SubscriptionClosed(_)) = sink.send(&count) {
+						break;
+					}
 					std::thread::sleep(Duration::from_millis(100));
 				});
 				Ok(())
diff --git a/tests/tests/integration_tests.rs b/tests/tests/integration_tests.rs
index 54696ec4d2..2c700dc5bf 100644
--- a/tests/tests/integration_tests.rs
+++ b/tests/tests/integration_tests.rs
@@ -33,6 +33,7 @@ use helpers::{http_server, websocket_server, websocket_server_with_subscription}
 use jsonrpsee::{
 	http_client::HttpClientBuilder,
 	types::{
+		error::SubscriptionClosedError,
 		traits::{Client, SubscriptionClient},
 		v2::ParamsSer,
 		Error, JsonValue, Subscription,
@@ -137,17 +138,16 @@ async fn ws_subscription_several_clients_with_drop() {
 		let (client, hello_sub, foo_sub) = clients.remove(i);
 		drop(hello_sub);
 		drop(foo_sub);
-		// Send this request to make sure that the client's background thread hasn't
-		// been canceled.
 		assert!(client.is_connected());
 		drop(client);
 	}
 
-	// make sure nothing weird happened after dropping half the clients (should be `unsubscribed` in the server)
+	// make sure nothing weird happened after dropping half of the clients (should be `unsubscribed` in the server)
 	// would be good to know that subscriptions actually were removed but not possible to verify at
 	// this layer.
 	for _ in 0..10 {
-		for (_client, hello_sub, foo_sub) in &mut clients {
+		for (client, hello_sub, foo_sub) in &mut clients {
+			assert!(client.is_connected());
 			let hello = hello_sub.next().await.unwrap().unwrap();
 			let foo = foo_sub.next().await.unwrap().unwrap();
 			assert_eq!(&hello, "hello from subscription");
@@ -295,3 +295,45 @@ async fn ws_close_pending_subscription_when_server_terminated() {
 
 	panic!("subscription keeps sending messages after server shutdown");
 }
+
+#[tokio::test]
+async fn ws_server_should_stop_subscription_after_client_drop() {
+	use futures::{channel::mpsc, SinkExt, StreamExt};
+	use jsonrpsee::{ws_server::WsServerBuilder, RpcModule};
+
+	let server = WsServerBuilder::default().build("127.0.0.1:0").await.unwrap();
+	let server_url = format!("ws://{}", server.local_addr().unwrap());
+
+	let (tx, mut rx) = mpsc::channel(1);
+	let mut module = RpcModule::new(tx);
+
+	module
+		.register_subscription("subscribe_hello", "unsubscribe_hello", |_, mut sink, mut tx| {
+			tokio::spawn(async move {
+				let close_err = loop {
+					if let Err(Error::SubscriptionClosed(err)) = sink.send(&1) {
+						break err;
+					}
+					tokio::time::sleep(Duration::from_millis(100)).await;
+				};
+				let send_back = Arc::make_mut(&mut tx);
+				send_back.feed(close_err).await.unwrap();
+			});
+			Ok(())
+		})
+		.unwrap();
+
+	tokio::spawn(async move { server.start(module).await });
+
+	let client = WsClientBuilder::default().build(&server_url).await.unwrap();
+
+	let mut sub: Subscription<usize> =
+		client.subscribe("subscribe_hello", ParamsSer::NoParams, "unsubscribe_hello").await.unwrap();
+
+	let res = sub.next().await.unwrap();
+
+	assert_eq!(res.as_ref(), Some(&1));
+	drop(client);
+	// assert that the server received `SubscriptionClosed` after the client was dropped.
+	assert!(matches!(rx.next().await.unwrap(), SubscriptionClosedError { .. }));
+}
diff --git a/tests/tests/proc_macros.rs b/tests/tests/proc_macros.rs
index 0ddb703726..e9daddfb33 100644
--- a/tests/tests/proc_macros.rs
+++ b/tests/tests/proc_macros.rs
@@ -28,7 +28,7 @@
 
 use std::net::SocketAddr;
 
-use futures_channel::oneshot;
+use futures::channel::oneshot;
 use jsonrpsee::{ws_client::*, ws_server::WsServerBuilder};
 use serde_json::value::RawValue;
 
diff --git a/utils/src/server/rpc_module.rs b/utils/src/server/rpc_module.rs
index 9ebf788a9a..7047a437e3 100644
--- a/utils/src/server/rpc_module.rs
+++ b/utils/src/server/rpc_module.rs
@@ -566,12 +566,12 @@ impl SubscriptionSink {
 
 impl Drop for SubscriptionSink {
 	fn drop(&mut self) {
-		self.close(format!("Subscription: {} is closed and dropped", self.uniq_sub.sub_id));
+		self.close(format!("Subscription: {} closed", self.uniq_sub.sub_id));
 	}
 }
 
 fn subscription_closed_err(sub_id: u64) -> Error {
-	Error::SubscriptionClosed(format!("Subscription {} is closed but not yet dropped", sub_id).into())
+	Error::SubscriptionClosed(format!("Subscription {} closed", sub_id).into())
 }
 
 #[cfg(test)]
@@ -765,6 +765,6 @@ mod tests {
 		// The subscription is now closed
 		let my_sub = my_sub_stream.next().await.unwrap();
 		let my_sub = serde_json::from_str::<SubscriptionResponse<SubscriptionClosedError>>(&my_sub).unwrap();
-		assert_eq!(my_sub.params.result, format!("Subscription: {} is closed and dropped", sub_id).to_string().into());
+		assert_eq!(my_sub.params.result, format!("Subscription: {} closed", sub_id).into());
 	}
 }
diff --git a/ws-client/src/client.rs b/ws-client/src/client.rs
index 18ef9eab30..beab6e59bb 100644
--- a/ws-client/src/client.rs
+++ b/ws-client/src/client.rs
@@ -298,6 +298,12 @@ impl WsClient {
 	}
 }
 
+impl Drop for WsClient {
+	fn drop(&mut self) {
+		self.to_back.close_channel();
+	}
+}
+
 #[async_trait]
 impl Client for WsClient {
 	async fn notification<'a>(&self, method: &'a str, params: ParamsSer<'a>) -> Result<(), Error> {
@@ -522,7 +528,7 @@ async fn background_task(
 			// There is nothing to do just terminate.
 			Either::Left((None, _)) => {
 				log::trace!("[backend]: frontend dropped; terminate client");
-				return;
+				break;
 			}
 
 			Either::Left((Some(FrontToBack::Batch(batch)), _)) => {
@@ -617,7 +623,7 @@ async fn background_task(
 						Ok(None) => (),
 						Err(err) => {
 							let _ = front_error.send(err);
-							return;
+							break;
 						}
 					}
 				}
@@ -656,19 +662,22 @@ async fn background_task(
 						serde_json::from_slice::<serde_json::Value>(&raw)
 					);
 					let _ = front_error.send(Error::Custom("Unparsable response".into()));
-					return;
+					break;
 				}
 			}
 			Either::Right((Some(Err(e)), _)) => {
 				log::error!("Error: {:?} terminating client", e);
 				let _ = front_error.send(Error::Transport(e.into()));
-				return;
+				break;
 			}
 			Either::Right((None, _)) => {
 				log::error!("[backend]: WebSocket receiver dropped; terminate client");
 				let _ = front_error.send(Error::Custom("WebSocket receiver dropped".into()));
-				return;
+				break;
 			}
 		}
 	}
+
+	// Send close message to the server.
+	let _ = sender.close().await;
 }
diff --git a/ws-client/src/manager.rs b/ws-client/src/manager.rs
index 126a2d51f0..3e67e3ca86 100644
--- a/ws-client/src/manager.rs
+++ b/ws-client/src/manager.rs
@@ -289,7 +289,7 @@ impl RequestManager {
 		}
 	}
 
-	/// Get a mutable reference to underlying `Sink` in order to send incmoing notifications to the subscription.
+	/// Get a mutable reference to underlying `Sink` in order to send incoming notifications to the subscription.
 	///
 	/// Returns `Some` if the `method` was registered as a NotificationHandler otherwise `None`.
 	pub fn as_notification_handler_mut(&mut self, method: String) -> Option<&mut SubscriptionSink> {
diff --git a/ws-client/src/transport.rs b/ws-client/src/transport.rs
index 715d95e675..7b999a4833 100644
--- a/ws-client/src/transport.rs
+++ b/ws-client/src/transport.rs
@@ -153,6 +153,11 @@ impl Sender {
 		self.inner.flush().await?;
 		Ok(())
 	}
+
+	/// Send a close message and close the connection.
+	pub async fn close(&mut self) -> Result<(), WsError> {
+		self.inner.close().await.map_err(Into::into)
+	}
 }
 
 impl Receiver {
diff --git a/ws-server/src/server.rs b/ws-server/src/server.rs
index 89eea96133..c91b28ed49 100644
--- a/ws-server/src/server.rs
+++ b/ws-server/src/server.rs
@@ -209,16 +209,16 @@ async fn background_task(
 	conn_id: ConnectionId,
 	methods: Methods,
 	max_request_body_size: u32,
-	stop_monitor: StopMonitor,
+	stop_server: StopMonitor,
 ) -> Result<(), Error> {
 	// And we can finally transition to a websocket background_task.
 	let (mut sender, mut receiver) = server.into_builder().finish();
 	let (tx, mut rx) = mpsc::unbounded::<String>();
+	let stop_server2 = stop_server.clone();
 
-	let stop_monitor2 = stop_monitor.clone();
 	// Send results back to the client.
 	tokio::spawn(async move {
-		while !stop_monitor2.shutdown_requested() {
+		while !stop_server2.shutdown_requested() {
 			match rx.next().await {
 				Some(response) => {
 					log::debug!("send: {}", response);
@@ -228,20 +228,24 @@ async fn background_task(
 				None => break,
 			};
 		}
-
-		drop(stop_monitor2);
 		// terminate connection.
 		let _ = sender.close().await;
+		// NOTE(niklasad1): when the receiver is dropped no further requests or subscriptions
+		// will be possible.
 	});
 
 	// Buffer for incoming data.
 	let mut data = Vec::with_capacity(100);
 	let mut method_executors = FutureDriver::default();
 
-	while !stop_monitor.shutdown_requested() {
+	while !stop_server.shutdown_requested() {
 		data.clear();
 
-		method_executors.select_with(receiver.receive_data(&mut data)).await?;
+		if let Err(e) = method_executors.select_with(receiver.receive_data(&mut data)).await {
+			log::error!("Could not receive WS data: {:?}; closing connection", e);
+			tx.close_channel();
+			return Err(e.into());
+		}
 
 		if data.len() > max_request_body_size as usize {
 			log::warn!("Request is too big ({} bytes, max is {})", data.len(), max_request_body_size);
@@ -295,9 +299,6 @@ async fn background_task(
 	// Drive all running methods to completion
 	method_executors.await;
 
-	// Drop the monitor for this task since we are shutting down
-	drop(stop_monitor);
-
 	Ok(())
 }