diff --git a/Lib/test/test_uuid.py b/Lib/test/test_uuid.py
index 06ec51da799..90671be05d4 100644
--- a/Lib/test/test_uuid.py
+++ b/Lib/test/test_uuid.py
@@ -429,7 +429,7 @@ class TestUUID(TestCase):
 
         # Make sure the generated UUIDs are actually unique.
         uuids = {}
-        for u in [uuid.uuid1() for i in range(1000)]:
+        for u in [uuid.uuid4() for i in range(1000)]:
             uuids[u] = 1
         equal(len(uuids.keys()), 1000)
 
diff --git a/Lib/uuid.py b/Lib/uuid.py
index 684bbeb9468..ae3da25ca55 100644
--- a/Lib/uuid.py
+++ b/Lib/uuid.py
@@ -488,8 +488,8 @@ def uuid1(node=None, clock_seq=None):
     # 0x01b21dd213814000 is the number of 100-ns intervals between the
     # UUID epoch 1582-10-15 00:00:00 and the Unix epoch 1970-01-01 00:00:00.
     timestamp = int(nanoseconds/100) + 0x01b21dd213814000L
-    if timestamp == _last_timestamp:
-        timestamp += 1
+    if timestamp <= _last_timestamp:
+        timestamp = _last_timestamp + 1
     _last_timestamp = timestamp
     if clock_seq is None:
         import random
diff --git a/Misc/NEWS b/Misc/NEWS
index c4824110ebb..2cd956193ed 100644
--- a/Misc/NEWS
+++ b/Misc/NEWS
@@ -4,6 +4,17 @@ Python News
 
 (editors: check NEWS.help for information about editing NEWS using ReST.)
 
+What's New in Python 2.5?
+=========================
+
+*Release date: XX-SEP-2006*
+
+Library
+-------
+
+- Bug #1541863: uuid.uuid1 failed to generate unique identifiers
+  on systems with low clock resolution.
+
 What's New in Python 2.5 release candidate 1?
 =============================================