diff --git a/asm/preproc.c b/asm/preproc.c
index 790cf73c..3ee36c10 100644
--- a/asm/preproc.c
+++ b/asm/preproc.c
@@ -3986,7 +3986,7 @@ issue_error:
                 break;
 
         if (l)
-            l->finishes->in_progress = 1;
+            l->finishes->in_progress = 0;
         else
             nasm_nonfatal("`%%exitrep' not within `%%rep' block");
         break;
diff --git a/test/exitrep.asm b/test/exitrep.asm
new file mode 100644
index 00000000..3be87055
--- /dev/null
+++ b/test/exitrep.asm
@@ -0,0 +1,16 @@
+%macro testrep 0.nolist
+  %assign i 1
+  %rep 4
+    mov eax,i
+    %if i==3
+      %exitrep
+    %endif
+    mov ebx,i
+    %ifn i < 3
+	%error iteration i should not be seen
+    %endif
+    %assign i i+1
+  %endrep
+%endmacro
+
+testrep