diff --git a/src/ex_docmd.c b/src/ex_docmd.c
index 1af60ab..eebdcff 100644
--- a/src/ex_docmd.c
+++ b/src/ex_docmd.c
@@ -787,8 +787,9 @@
 #endif
 
     /* It's possible to create an endless loop with ":execute", catch that
-     * here.  The value of 200 allows nested function calls, ":source", etc. */
-    if (call_depth == 200)
+     * here.  The value of 200 allows nested function calls, ":source", etc.
+     * Allow 200 or 'maxfuncdepth', whatever is larger. */
+    if (call_depth >= 200 && call_depth >= p_mfd)
     {
 	EMSG(_("E169: Command too recursive"));
 #ifdef FEAT_EVAL
diff --git a/src/testdir/test_nested_function.vim b/src/testdir/test_nested_function.vim
index 7e301ed..afaaea6 100644
--- a/src/testdir/test_nested_function.vim
+++ b/src/testdir/test_nested_function.vim
@@ -40,3 +40,24 @@
   delfunc g:X
   unlet g:Y
 endfunc
+
+func Recurse(count)
+  if a:count > 0
+    call Recurse(a:count - 1)
+  endif
+endfunc
+
+func Test_max_nesting()
+  let call_depth_here = 2
+  let ex_depth_here = 5
+  set mfd&
+
+  call Recurse(99 - call_depth_here)
+  call assert_fails('call Recurse(' . (100 - call_depth_here) . ')', 'E132:')
+
+  set mfd=210
+  call Recurse(209 - ex_depth_here)
+  call assert_fails('call Recurse(' . (210 - ex_depth_here) . ')', 'E169:')
+
+  set mfd&
+endfunc
diff --git a/src/version.c b/src/version.c
index f4f20fa..4a2b3c7 100644
--- a/src/version.c
+++ b/src/version.c
@@ -765,6 +765,8 @@
 static int included_patches[] =
 {   /* Add new patch number below this line */
 /**/
+    137,
+/**/
     136,
 /**/
     135,