diff --git a/src/edit.c b/src/edit.c
index d763b53..53b43c4 100644
--- a/src/edit.c
+++ b/src/edit.c
@@ -2799,9 +2799,6 @@
 	ins_compl_prep(' ');
     ins_compl_clear();
 
-    if (stop_arrow() == FAIL)
-	return;
-
     compl_direction = FORWARD;
     if (startcol > curwin->w_cursor.col)
 	startcol = curwin->w_cursor.col;
@@ -3876,7 +3873,8 @@
 		/* put the cursor on the last char, for 'tw' formatting */
 		if (prev_col > 0)
 		    dec_cursor();
-		if (stop_arrow() == OK)
+		/* only format when something was inserted */
+		if (!arrow_used && !ins_need_undo)
 		    insertchar(NUL, 0, -1);
 		if (prev_col > 0
 			     && ml_get_curline()[curwin->w_cursor.col] != NUL)
diff --git a/src/testdir/test_popup.vim b/src/testdir/test_popup.vim
index 7cb0e10..38459b3 100644
--- a/src/testdir/test_popup.vim
+++ b/src/testdir/test_popup.vim
@@ -378,7 +378,7 @@
   endif
 endfunc
 
-:"Test that 'completefunc' works when it's OK.
+" Test that 'completefunc' works when it's OK.
 func Test_omnifunc_with_check()
   new
   setlocal omnifunc=DummyCompleteFour
@@ -400,4 +400,30 @@
   q!
 endfunc
 
+function UndoComplete()
+  call complete(1, ['January', 'February', 'March',
+        \ 'April', 'May', 'June', 'July', 'August', 'September',
+        \ 'October', 'November', 'December'])
+  return ''
+endfunc
+
+" Test that no undo item is created when no completion is inserted
+func Test_complete_no_undo()
+  set completeopt=menu,preview,noinsert,noselect
+  inoremap <Right> <C-R>=UndoComplete()<CR>
+  new
+  call feedkeys("ixxx\<CR>\<CR>yyy\<Esc>k", 'xt')
+  call feedkeys("iaaa\<Esc>0", 'xt')
+  call assert_equal('aaa', getline(2))
+  call feedkeys("i\<Right>\<Esc>", 'xt')
+  call assert_equal('aaa', getline(2))
+  call feedkeys("u", 'xt')
+  call assert_equal('', getline(2))
+
+  iunmap <Right>
+  set completeopt&
+  q!
+endfunc
+
+
 " vim: shiftwidth=2 sts=2 expandtab
diff --git a/src/version.c b/src/version.c
index e6f8f47..4902d69 100644
--- a/src/version.c
+++ b/src/version.c
@@ -765,6 +765,8 @@
 static int included_patches[] =
 {   /* Add new patch number below this line */
 /**/
+    41,
+/**/
     40,
 /**/
     39,