diff --git a/Misc/python-mode.el b/Misc/python-mode.el
index 217a65504f1..0d5df7b40e2 100644
--- a/Misc/python-mode.el
+++ b/Misc/python-mode.el
@@ -310,13 +310,25 @@ Currently-active file is at the head of the list.")
 (defconst py-outdent-re
   (concat "\\(" (mapconcat 'identity
 			   '("else:"
-			     "except\\s +.*:"
+			     "except\\(\\s +.*\\)?:"
 			     "finally:"
 			     "elif\\s +.*:")
 			   "\\|")
 	  "\\)")
   "Regexp matching clauses to be outdented one level.")
 
+(defconst py-no-outdent-re
+  (concat "\\(" (mapconcat 'identity
+			   '("try\\s +.*:"
+			     "except\\(\\s +.*\\)?:"
+			     "while\\s +.*:"
+			     "for\\s +.*:"
+			     "if\\s +.*:"
+			     "elif\\s +.*:")
+			   "\\|")
+	  "\\)")
+  "Regexp matching lines to not outdent after.")
+
 
 ;;;###autoload
 (defun python-mode ()
@@ -397,20 +409,27 @@ In certain cases the line is outdented appropriately.  If a numeric
 argument is provided, that many colons are inserted non-electrically."
   (interactive "P")
   (self-insert-command (prefix-numeric-value arg))
-  (let (this-indent)
-    (if (and (not arg)
-	     (save-excursion
-	       (back-to-indentation)
-	       (looking-at py-outdent-re))
-	     (= (setq this-indent (py-compute-indentation))
-		(save-excursion
-		  (forward-line -1)
-		  (py-compute-indentation)))
-	     )
-	(save-excursion
-	  (beginning-of-line)
-	  (delete-horizontal-space)
-	  (indent-to (- this-indent py-indent-offset)))
+  (save-excursion
+    (let ((here (point))
+	  (outdent 0)
+	  (indent (py-compute-indentation)))
+      (if (and (not arg)
+	       (progn
+		 (back-to-indentation)
+		 (looking-at py-outdent-re))
+	       (prog2
+		   (backward-to-indentation 1)
+		   (not (looking-at py-no-outdent-re))
+		 (goto-char here))
+	       (= indent (progn
+			   (forward-line -1)
+			   (py-compute-indentation)))
+	       )
+	  (setq outdent py-indent-offset))
+      (goto-char here)
+      (beginning-of-line)
+      (delete-horizontal-space)
+      (indent-to (- indent outdent))
       )))
 
 
@@ -630,10 +649,12 @@ needed so that only a single column position is deleted."
   (let* ((ci (current-indentation))
 	 (move-to-indentation-p (<= (current-column) ci))
 	 (need (py-compute-indentation)))
-    ;; watch for outdents
+    ;; see if we need to outdent
     (if (save-excursion
-	  (back-to-indentation)
-	  (looking-at py-outdent-re))
+	  (and (progn (back-to-indentation)
+		      (looking-at py-outdent-re))
+	       (progn (backward-to-indentation 1)
+		      (not (looking-at py-no-outdent-re)))))
 	(setq need (- need py-indent-offset)))
     (if (/= ci need)
 	(save-excursion