diff --git a/tests/test-copies.t b/tests/test-copies.t
--- a/tests/test-copies.t
+++ b/tests/test-copies.t
@@ -1,6 +1,8 @@
 #testcases filelog compatibility
 
   $ cat >> $HGRCPATH << EOF
+  > [extensions]
+  > rebase=
   > [alias]
   > l = log -G -T '{rev} {desc}\n{files}\n'
   > EOF
@@ -552,3 +554,108 @@
       b
      +baba
   
+Test which demonstrate that fullcopytracing algorithm can fail to handle a case when both the csets are dirty
+----------------------------------------------------------------------------------------------------------
+
+  $ newrepo
+  $ echo a > a
+  $ hg add a
+  $ hg ci -m "added a"
+  $ echo b > b
+  $ hg add b
+  $ hg ci -m "added b"
+
+  $ echo foobar > willconflict
+  $ hg add willconflict
+  $ hg ci -m "added willconflict"
+  $ echo c > c
+  $ hg add c
+  $ hg ci -m "added c"
+
+  $ hg log -G -T '{rev} : {node|short}   {desc} \n{phase}\n'
+  @  3 : 9a8bb7cc6814   added c
+  |  draft
+  o  2 : d2ea38baf44e   added willconflict
+  |  draft
+  o  1 : 5f6d8a4bf34a   added b
+  |  draft
+  o  0 : 9092f1db7931   added a
+     draft
+
+  $ hg up ".^^"
+  0 files updated, 0 files merged, 2 files removed, 0 files unresolved
+  $ echo d > d
+  $ hg add d
+  $ hg ci -m "added d"
+  created new head
+
+  $ echo barfoo > willconflict
+  $ hg add willconflict
+  $ hg ci --amend -m "added willconflict and d"
+
+  $ hg l
+  @  5 added willconflict and d
+  |  d willconflict
+  | o  3 added c
+  | |  c
+  | o  2 added willconflict
+  |/   willconflict
+  o  1 added b
+  |  b
+  o  0 added a
+     a
+
+  $ hg rebase -r . -d 2
+  rebasing 5:5018b1509e94 "added willconflict and d" (tip)
+  merging willconflict
+  warning: conflicts while merging willconflict! (edit, then use 'hg resolve --mark')
+  unresolved conflicts (see hg resolve, then hg rebase --continue)
+  [1]
+
+  $ hg diff
+  diff -r d2ea38baf44e d
+  --- /dev/null	Thu Jan 01 00:00:00 1970 +0000
+  +++ b/d	Thu Jan 01 00:00:00 1970 +0000
+  @@ -0,0 +1,1 @@
+  +d
+  diff -r d2ea38baf44e willconflict
+  --- a/willconflict	Thu Jan 01 00:00:00 1970 +0000
+  +++ b/willconflict	Thu Jan 01 00:00:00 1970 +0000
+  @@ -1,1 +1,5 @@
+  +<<<<<<< dest:   d2ea38baf44e - test: added willconflict
+   foobar
+  +=======
+  +barfoo
+  +>>>>>>> source: 5018b1509e94 - test: added willconflict and d
+
+  $ echo barfoo > willconflict
+  $ hg resolve -m
+  (no more unresolved files)
+  continue: hg rebase --continue
+  $ hg rebase --continue
+  rebasing 5:5018b1509e94 "added willconflict and d" (tip)
+
+  $ hg up 3 -q
+
+  $ hg l --hidden
+  o  6 added willconflict and d
+  |  d willconflict
+  | x  5 added willconflict and d
+  | |  d willconflict
+  | | x  4 added d
+  | |/   d
+  +---@  3 added c
+  | |    c
+  o |  2 added willconflict
+  |/   willconflict
+  o  1 added b
+  |  b
+  o  0 added a
+     a
+
+Now if we trigger a merge between cset revision 3 and 6 using base revision 4, in this case
+both the merging csets will be dirty as no one is descendent of base revision:
+
+  $ hg graft -r 6 --base 4 --hidden 2>&1 | grep "AssertionError"
+  AssertionError
+