diff --git a/lib/handlebars.js b/lib/handlebars.js
index 22137012..afa80134 100644
--- a/lib/handlebars.js
+++ b/lib/handlebars.js
@@ -359,7 +359,7 @@ Handlebars.Compiler.prototype = {
     } else if (parts.length == 1) {
       return "(!Handlebars.isEmpty(context['" + parts[0] + "']) ? context['" + parts[0] + "'] : fallback['" + parts[0] + "'])";
     } else {
-      return "(!Handlebars.isEmpty(context) ? context : fallback)";
+      return "(!Handlebars.isEmpty(context) ? context : null)";
     }
   },
 
diff --git a/test/handlebars.js b/test/handlebars.js
index d329e4a1..a589ee55 100644
--- a/test/handlebars.js
+++ b/test/handlebars.js
@@ -110,6 +110,10 @@ test("bad idea nested paths", function() {
   shouldCompileTo(string, hash, "world world world ", "Same context (.) is ignored in paths");
 });
 
+test("that current context path ({{.}}) doesn't hit fallback", function() {
+	shouldCompileTo("test: {{.}}", [null, {helper: "awesome"}], "test: ");
+});
+
 test("complex but empty paths", function() {
   shouldCompileTo("{{person/name}}", {person: {name: null}}, "");
   shouldCompileTo("{{person/name}}", {person: {}}, "");