diff --git a/core/tx_pool.go b/core/tx_pool.go
index b21384458a..388b40058f 100644
--- a/core/tx_pool.go
+++ b/core/tx_pool.go
@@ -618,7 +618,7 @@ func (pool *TxPool) add(tx *types.Transaction, local bool) (bool, error) {
 	// If the transaction pool is full, discard underpriced transactions
 	if uint64(len(pool.all)) >= pool.config.GlobalSlots+pool.config.GlobalQueue {
 		// If the new transaction is underpriced, don't accept it
-		if pool.priced.Underpriced(tx, pool.locals) {
+		if !local && pool.priced.Underpriced(tx, pool.locals) {
 			log.Trace("Discarding underpriced transaction", "hash", hash, "price", tx.GasPrice())
 			underpricedTxCounter.Inc(1)
 			return false, ErrUnderpriced
diff --git a/core/tx_pool_test.go b/core/tx_pool_test.go
index 0cb14cb6a4..9a5cb297a2 100644
--- a/core/tx_pool_test.go
+++ b/core/tx_pool_test.go
@@ -1346,7 +1346,7 @@ func TestTransactionPoolUnderpricing(t *testing.T) {
 	defer sub.Unsubscribe()
 
 	// Create a number of test accounts and fund them
-	keys := make([]*ecdsa.PrivateKey, 3)
+	keys := make([]*ecdsa.PrivateKey, 4)
 	for i := 0; i < len(keys); i++ {
 		keys[i], _ = crypto.GenerateKey()
 		pool.currentState.AddBalance(crypto.PubkeyToAddress(keys[i].PublicKey), big.NewInt(1000000))
@@ -1406,7 +1406,7 @@ func TestTransactionPoolUnderpricing(t *testing.T) {
 		t.Fatalf("pool internal state corrupted: %v", err)
 	}
 	// Ensure that adding local transactions can push out even higher priced ones
-	tx := pricedTransaction(1, 100000, big.NewInt(0), keys[2])
+	tx := pricedTransaction(0, 100000, big.NewInt(0), keys[3])
 	if err := pool.AddLocal(tx); err != nil {
 		t.Fatalf("failed to add underpriced local transaction: %v", err)
 	}