diff --git a/src/search.c b/src/search.c
index 920c68c..4396651 100644
--- a/src/search.c
+++ b/src/search.c
@@ -430,6 +430,10 @@
 pat_has_uppercase(char_u *pat)
 {
     char_u *p = pat;
+    magic_T magic_val = MAGIC_ON;
+
+    // get the magicness of the pattern
+    (void)skip_regexp_ex(pat, NUL, magic_isset(), NULL, NULL, &magic_val);
 
     while (*p != NUL)
     {
@@ -441,7 +445,7 @@
 		return TRUE;
 	    p += l;
 	}
-	else if (*p == '\\')
+	else if (*p == '\\' && magic_val == MAGIC_ON)
 	{
 	    if (p[1] == '_' && p[2] != NUL)  // skip "\_X"
 		p += 3;
@@ -452,6 +456,11 @@
 	    else
 		p += 1;
 	}
+	else if ((*p == '%' || *p == '_') && magic_val == MAGIC_ALL)
+	{
+	    if (p[1] != NUL)  // skip "_X" and %X
+		p += 2;
+	}
 	else if (MB_ISUPPER(*p))
 	    return TRUE;
 	else
diff --git a/src/testdir/test_search.vim b/src/testdir/test_search.vim
index 045fa2e..1b16207 100644
--- a/src/testdir/test_search.vim
+++ b/src/testdir/test_search.vim
@@ -1912,4 +1912,58 @@
   call delete('Xis_subst_script2')
 endfunc
 
+func Test_pattern_is_uppercase_smartcase()
+  new
+  let input=['abc', 'ABC', 'Abc', 'abC']
+  call setline(1, input)
+  call cursor(1,1)
+  " default, matches firstline
+  %s/abc//g
+  call assert_equal(['', 'ABC', 'Abc', 'abC'],
+        \ getline(1, '$'))
+
+  set smartcase ignorecase
+  sil %d
+  call setline(1, input)
+  call cursor(1,1)
+  " with smartcase and incsearch set, matches everything
+  %s/abc//g
+  call assert_equal(['', '', '', ''], getline(1, '$'))
+
+  sil %d
+  call setline(1, input)
+  call cursor(1,1)
+  " with smartcase and incsearch set and found an uppercase letter,
+  " match only that.
+  %s/abC//g
+  call assert_equal(['abc', 'ABC', 'Abc', ''],
+        \ getline(1, '$'))
+
+  sil %d
+  call setline(1, input)
+  call cursor(1,1)
+  exe "norm! vG$\<esc>"
+  " \%V should not be detected as uppercase letter
+  %s/\%Vabc//g
+  call assert_equal(['', '', '', ''], getline(1, '$'))
+
+  call setline(1, input)
+  call cursor(1,1)
+  exe "norm! vG$\<esc>"
+  " \v%V should not be detected as uppercase letter
+  %s/\v%Vabc//g
+  call assert_equal(['', '', '', ''], getline(1, '$'))
+
+  call setline(1, input)
+  call cursor(1,1)
+  exe "norm! vG$\<esc>"
+  " \v%VabC should be detected as uppercase letter
+  %s/\v%VabC//g
+  call assert_equal(['abc', 'ABC', 'Abc', ''],
+        \ getline(1, '$'))
+
+  set smartcase& ignorecase&
+  bw!
+endfunc
+
 " vim: shiftwidth=2 sts=2 expandtab
diff --git a/src/version.c b/src/version.c
index 1a05c52..7095982 100644
--- a/src/version.c
+++ b/src/version.c
@@ -756,6 +756,8 @@
 static int included_patches[] =
 {   /* Add new patch number below this line */
 /**/
+    3265,
+/**/
     3264,
 /**/
     3263,