diff --git a/accounts/abi/bind/backends/simulated.go b/accounts/abi/bind/backends/simulated.go
index 7ac8b58204..f0b5920420 100644
--- a/accounts/abi/bind/backends/simulated.go
+++ b/accounts/abi/bind/backends/simulated.go
@@ -167,7 +167,7 @@ func (b *SimulatedBackend) CallContract(ctx context.Context, call ethereum.CallM
 	if err != nil {
 		return nil, err
 	}
-	rval, _, err := b.callContract(ctx, call, b.blockchain.CurrentBlock(), state)
+	rval, _, _, err := b.callContract(ctx, call, b.blockchain.CurrentBlock(), state)
 	return rval, err
 }
 
@@ -177,7 +177,7 @@ func (b *SimulatedBackend) PendingCallContract(ctx context.Context, call ethereu
 	defer b.mu.Unlock()
 	defer b.pendingState.RevertToSnapshot(b.pendingState.Snapshot())
 
-	rval, _, err := b.callContract(ctx, call, b.pendingBlock, b.pendingState)
+	rval, _, _, err := b.callContract(ctx, call, b.pendingBlock, b.pendingState)
 	return rval, err
 }
 
@@ -215,11 +215,11 @@ func (b *SimulatedBackend) EstimateGas(ctx context.Context, call ethereum.CallMs
 		call.Gas = new(big.Int).SetUint64(mid)
 
 		snapshot := b.pendingState.Snapshot()
-		_, gas, err := b.callContract(ctx, call, b.pendingBlock, b.pendingState)
+		_, _, failed, err := b.callContract(ctx, call, b.pendingBlock, b.pendingState)
 		b.pendingState.RevertToSnapshot(snapshot)
 
-		// If the transaction became invalid or used all the gas (failed), raise the gas limit
-		if err != nil || gas.Cmp(call.Gas) == 0 {
+		// If the transaction became invalid or failed, raise the gas limit
+		if err != nil || failed {
 			lo = mid
 			continue
 		}
@@ -231,7 +231,7 @@ func (b *SimulatedBackend) EstimateGas(ctx context.Context, call ethereum.CallMs
 
 // callContract implemens common code between normal and pending contract calls.
 // state is modified during execution, make sure to copy it if necessary.
-func (b *SimulatedBackend) callContract(ctx context.Context, call ethereum.CallMsg, block *types.Block, statedb *state.StateDB) ([]byte, *big.Int, error) {
+func (b *SimulatedBackend) callContract(ctx context.Context, call ethereum.CallMsg, block *types.Block, statedb *state.StateDB) ([]byte, *big.Int, bool, error) {
 	// Ensure message is initialized properly.
 	if call.GasPrice == nil {
 		call.GasPrice = big.NewInt(1)
@@ -253,8 +253,8 @@ func (b *SimulatedBackend) callContract(ctx context.Context, call ethereum.CallM
 	// about the transaction and calling mechanisms.
 	vmenv := vm.NewEVM(evmContext, statedb, b.config, vm.Config{})
 	gaspool := new(core.GasPool).AddGas(math.MaxBig256)
-	ret, gasUsed, _, err := core.NewStateTransition(vmenv, msg, gaspool).TransitionDb()
-	return ret, gasUsed, err
+	ret, gasUsed, _, failed, err := core.NewStateTransition(vmenv, msg, gaspool).TransitionDb()
+	return ret, gasUsed, failed, err
 }
 
 // SendTransaction updates the pending block to include the given transaction.
diff --git a/cmd/evm/runner.go b/cmd/evm/runner.go
index 3f95a0c93a..a9b7459a4a 100644
--- a/cmd/evm/runner.go
+++ b/cmd/evm/runner.go
@@ -178,12 +178,12 @@ func runCmd(ctx *cli.Context) error {
 	var leftOverGas uint64
 	if ctx.GlobalBool(CreateFlag.Name) {
 		input := append(code, common.Hex2Bytes(ctx.GlobalString(InputFlag.Name))...)
-		ret, _, leftOverGas, err = runtime.Create(input, &runtimeConfig)
+		ret, _, leftOverGas, _, err = runtime.Create(input, &runtimeConfig)
 	} else {
 		receiver := common.StringToAddress("receiver")
 		statedb.SetCode(receiver, code)
 
-		ret, leftOverGas, err = runtime.Call(receiver, common.Hex2Bytes(ctx.GlobalString(InputFlag.Name)), &runtimeConfig)
+		ret, leftOverGas, _, err = runtime.Call(receiver, common.Hex2Bytes(ctx.GlobalString(InputFlag.Name)), &runtimeConfig)
 	}
 	execTime := time.Since(tstart)
 
diff --git a/core/state_processor.go b/core/state_processor.go
index 90f5a4f60c..9c6b69adf7 100644
--- a/core/state_processor.go
+++ b/core/state_processor.go
@@ -98,7 +98,7 @@ func ApplyTransaction(config *params.ChainConfig, bc *BlockChain, author *common
 	// about the transaction and calling mechanisms.
 	vmenv := vm.NewEVM(context, statedb, config, cfg)
 	// Apply the transaction to the current state (included in the env)
-	_, gas, err := ApplyMessage(vmenv, msg, gp)
+	_, gas, _, err := ApplyMessage(vmenv, msg, gp)
 	if err != nil {
 		return nil, nil, err
 	}
diff --git a/core/state_transition.go b/core/state_transition.go
index 0ae9d7fcbf..d8ed410403 100644
--- a/core/state_transition.go
+++ b/core/state_transition.go
@@ -127,11 +127,11 @@ func NewStateTransition(evm *vm.EVM, msg Message, gp *GasPool) *StateTransition
 // the gas used (which includes gas refunds) and an error if it failed. An error always
 // indicates a core error meaning that the message would always fail for that particular
 // state and would never be accepted within a block.
-func ApplyMessage(evm *vm.EVM, msg Message, gp *GasPool) ([]byte, *big.Int, error) {
+func ApplyMessage(evm *vm.EVM, msg Message, gp *GasPool) ([]byte, *big.Int, bool, error) {
 	st := NewStateTransition(evm, msg, gp)
 
-	ret, _, gasUsed, err := st.TransitionDb()
-	return ret, gasUsed, err
+	ret, _, gasUsed, failed, err := st.TransitionDb()
+	return ret, gasUsed, failed, err
 }
 
 func (st *StateTransition) from() vm.AccountRef {
@@ -208,7 +208,7 @@ func (st *StateTransition) preCheck() error {
 // TransitionDb will transition the state by applying the current message and returning the result
 // including the required gas for the operation as well as the used gas. It returns an error if it
 // failed. An error indicates a consensus issue.
-func (st *StateTransition) TransitionDb() (ret []byte, requiredGas, usedGas *big.Int, err error) {
+func (st *StateTransition) TransitionDb() (ret []byte, requiredGas, usedGas *big.Int, failed bool, err error) {
 	if err = st.preCheck(); err != nil {
 		return
 	}
@@ -222,10 +222,10 @@ func (st *StateTransition) TransitionDb() (ret []byte, requiredGas, usedGas *big
 	// TODO convert to uint64
 	intrinsicGas := IntrinsicGas(st.data, contractCreation, homestead)
 	if intrinsicGas.BitLen() > 64 {
-		return nil, nil, nil, vm.ErrOutOfGas
+		return nil, nil, nil, false, vm.ErrOutOfGas
 	}
 	if err = st.useGas(intrinsicGas.Uint64()); err != nil {
-		return nil, nil, nil, err
+		return nil, nil, nil, false, err
 	}
 
 	var (
@@ -236,11 +236,11 @@ func (st *StateTransition) TransitionDb() (ret []byte, requiredGas, usedGas *big
 		vmerr error
 	)
 	if contractCreation {
-		ret, _, st.gas, vmerr = evm.Create(sender, st.data, st.gas, st.value)
+		ret, _, st.gas, failed, vmerr = evm.Create(sender, st.data, st.gas, st.value)
 	} else {
 		// Increment the nonce for the next transaction
 		st.state.SetNonce(sender.Address(), st.state.GetNonce(sender.Address())+1)
-		ret, st.gas, vmerr = evm.Call(sender, st.to().Address(), st.data, st.gas, st.value)
+		ret, st.gas, failed, vmerr = evm.Call(sender, st.to().Address(), st.data, st.gas, st.value)
 	}
 	if vmerr != nil {
 		log.Debug("VM returned with error", "err", vmerr)
@@ -248,7 +248,7 @@ func (st *StateTransition) TransitionDb() (ret []byte, requiredGas, usedGas *big
 		// sufficient balance to make the transfer happen. The first
 		// balance transfer may never fail.
 		if vmerr == vm.ErrInsufficientBalance {
-			return nil, nil, nil, vmerr
+			return nil, nil, nil, false, vmerr
 		}
 	}
 	requiredGas = new(big.Int).Set(st.gasUsed())
@@ -256,7 +256,7 @@ func (st *StateTransition) TransitionDb() (ret []byte, requiredGas, usedGas *big
 	st.refundGas()
 	st.state.AddBalance(st.evm.Coinbase, new(big.Int).Mul(st.gasUsed(), st.gasPrice))
 
-	return ret, requiredGas, st.gasUsed(), err
+	return ret, requiredGas, st.gasUsed(), failed, err
 }
 
 func (st *StateTransition) refundGas() {
diff --git a/core/vm/contract.go b/core/vm/contract.go
index 66748e8215..bfd62fa751 100644
--- a/core/vm/contract.go
+++ b/core/vm/contract.go
@@ -62,6 +62,7 @@ type Contract struct {
 	Args []byte
 
 	DelegateCall bool
+	Failed       bool // Used to identify the execution status of the current transaction
 }
 
 // NewContract returns a new contract environment for the execution of EVM.
@@ -151,3 +152,12 @@ func (self *Contract) SetCallCode(addr *common.Address, hash common.Hash, code [
 	self.CodeHash = hash
 	self.CodeAddr = addr
 }
+
+// MarkFailed mark current transaction's execution failed.
+func (self *Contract) MarkFailed() {
+	self.Failed = true
+	// affect parent recursively
+	if parent, ok := self.caller.(*Contract); ok {
+		parent.MarkFailed()
+	}
+}
diff --git a/core/vm/evm.go b/core/vm/evm.go
index 9296cc7cac..3873d2d29c 100644
--- a/core/vm/evm.go
+++ b/core/vm/evm.go
@@ -124,18 +124,18 @@ func (evm *EVM) Cancel() {
 // Call executes the contract associated with the addr with the given input as parameters. It also handles any
 // necessary value transfer required and takes the necessary steps to create accounts and reverses the state in
 // case of an execution error or failed value transfer.
-func (evm *EVM) Call(caller ContractRef, addr common.Address, input []byte, gas uint64, value *big.Int) (ret []byte, leftOverGas uint64, err error) {
+func (evm *EVM) Call(caller ContractRef, addr common.Address, input []byte, gas uint64, value *big.Int) (ret []byte, leftOverGas uint64, failed bool, err error) {
 	if evm.vmConfig.NoRecursion && evm.depth > 0 {
-		return nil, gas, nil
+		return nil, gas, false, nil
 	}
 
 	// Depth check execution. Fail if we're trying to execute above the
 	// limit.
 	if evm.depth > int(params.CallCreateDepth) {
-		return nil, gas, ErrDepth
+		return nil, gas, false, ErrDepth
 	}
 	if !evm.Context.CanTransfer(evm.StateDB, caller.Address(), value) {
-		return nil, gas, ErrInsufficientBalance
+		return nil, gas, false, ErrInsufficientBalance
 	}
 
 	var (
@@ -144,7 +144,7 @@ func (evm *EVM) Call(caller ContractRef, addr common.Address, input []byte, gas
 	)
 	if !evm.StateDB.Exist(addr) {
 		if PrecompiledContracts[addr] == nil && evm.ChainConfig().IsEIP158(evm.BlockNumber) && value.Sign() == 0 {
-			return nil, gas, nil
+			return nil, gas, false, nil
 		}
 
 		evm.StateDB.CreateAccount(addr)
@@ -164,8 +164,9 @@ func (evm *EVM) Call(caller ContractRef, addr common.Address, input []byte, gas
 	if err != nil {
 		contract.UseGas(contract.Gas)
 		evm.StateDB.RevertToSnapshot(snapshot)
+		contract.MarkFailed()
 	}
-	return ret, contract.Gas, err
+	return ret, contract.Gas, contract.Failed, err
 }
 
 // CallCode executes the contract associated with the addr with the given input as parameters. It also handles any
@@ -201,6 +202,7 @@ func (evm *EVM) CallCode(caller ContractRef, addr common.Address, input []byte,
 	if err != nil {
 		contract.UseGas(contract.Gas)
 		evm.StateDB.RevertToSnapshot(snapshot)
+		contract.MarkFailed()
 	}
 
 	return ret, contract.Gas, err
@@ -235,24 +237,25 @@ func (evm *EVM) DelegateCall(caller ContractRef, addr common.Address, input []by
 	if err != nil {
 		contract.UseGas(contract.Gas)
 		evm.StateDB.RevertToSnapshot(snapshot)
+		contract.MarkFailed()
 	}
 
 	return ret, contract.Gas, err
 }
 
 // Create creates a new contract using code as deployment code.
-func (evm *EVM) Create(caller ContractRef, code []byte, gas uint64, value *big.Int) (ret []byte, contractAddr common.Address, leftOverGas uint64, err error) {
+func (evm *EVM) Create(caller ContractRef, code []byte, gas uint64, value *big.Int) (ret []byte, contractAddr common.Address, leftOverGas uint64, failed bool, err error) {
 	if evm.vmConfig.NoRecursion && evm.depth > 0 {
-		return nil, common.Address{}, gas, nil
+		return nil, common.Address{}, gas, false, nil
 	}
 
 	// Depth check execution. Fail if we're trying to execute above the
 	// limit.
 	if evm.depth > int(params.CallCreateDepth) {
-		return nil, common.Address{}, gas, ErrDepth
+		return nil, common.Address{}, gas, false, ErrDepth
 	}
 	if !evm.CanTransfer(evm.StateDB, caller.Address(), value) {
-		return nil, common.Address{}, gas, ErrInsufficientBalance
+		return nil, common.Address{}, gas, false, ErrInsufficientBalance
 	}
 
 	// Create a new account on the state
@@ -297,6 +300,11 @@ func (evm *EVM) Create(caller ContractRef, code []byte, gas uint64, value *big.I
 		contract.UseGas(contract.Gas)
 		evm.StateDB.RevertToSnapshot(snapshot)
 	}
+	// When the virtual machine returns an error or stores an excessive contract code,
+	// the execution of the transaction is marked as failed.
+	if maxCodeSizeExceeded || err != nil {
+		contract.MarkFailed()
+	}
 	// If the vm returned with an error the return value should be set to nil.
 	// This isn't consensus critical but merely to for behaviour reasons such as
 	// tests, RPC calls, etc.
@@ -304,7 +312,7 @@ func (evm *EVM) Create(caller ContractRef, code []byte, gas uint64, value *big.I
 		ret = nil
 	}
 
-	return ret, contractAddr, contract.Gas, err
+	return ret, contractAddr, contract.Gas, contract.Failed, err
 }
 
 // ChainConfig returns the evmironment's chain configuration
diff --git a/core/vm/instructions.go b/core/vm/instructions.go
index f5164fcdd4..6babf600c4 100644
--- a/core/vm/instructions.go
+++ b/core/vm/instructions.go
@@ -551,7 +551,8 @@ func opCreate(pc *uint64, evm *EVM, contract *Contract, memory *Memory, stack *S
 	}
 
 	contract.UseGas(gas)
-	_, addr, returnGas, suberr := evm.Create(contract, input, gas, value)
+	// ignore failed flag here since it is only useful in vm entrance.
+	_, addr, returnGas, _, suberr := evm.Create(contract, input, gas, value)
 	// Push item on the stack based on the returned error. If the ruleset is
 	// homestead we must check for CodeStoreOutOfGasError (homestead only
 	// rule) and treat as an error, if the ruleset is frontier we must
@@ -588,8 +589,8 @@ func opCall(pc *uint64, evm *EVM, contract *Contract, memory *Memory, stack *Sta
 	if value.Sign() != 0 {
 		gas += params.CallStipend
 	}
-
-	ret, returnGas, err := evm.Call(contract, address, args, gas, value)
+	// ignore failed flag here, same with opCreate.
+	ret, returnGas, _, err := evm.Call(contract, address, args, gas, value)
 	if err != nil {
 		stack.push(new(big.Int))
 	} else {
diff --git a/core/vm/runtime/fuzz.go b/core/vm/runtime/fuzz.go
index cb9ff08b5b..2b3eddb964 100644
--- a/core/vm/runtime/fuzz.go
+++ b/core/vm/runtime/fuzz.go
@@ -23,7 +23,7 @@ package runtime
 // This returns 1 for valid parsable/runable code, 0
 // for invalid opcode.
 func Fuzz(input []byte) int {
-	_, _, err := Execute(input, input, &Config{
+	_, _, _, err := Execute(input, input, &Config{
 		GasLimit: 3000000,
 	})
 
diff --git a/core/vm/runtime/runtime.go b/core/vm/runtime/runtime.go
index 44cde4f70a..b69df4d617 100644
--- a/core/vm/runtime/runtime.go
+++ b/core/vm/runtime/runtime.go
@@ -94,7 +94,7 @@ func setDefaults(cfg *Config) {
 // Executes sets up a in memory, temporarily, environment for the execution of
 // the given code. It enabled the JIT by default and make sure that it's restored
 // to it's original state afterwards.
-func Execute(code, input []byte, cfg *Config) ([]byte, *state.StateDB, error) {
+func Execute(code, input []byte, cfg *Config) ([]byte, *state.StateDB, bool, error) {
 	if cfg == nil {
 		cfg = new(Config)
 	}
@@ -113,7 +113,7 @@ func Execute(code, input []byte, cfg *Config) ([]byte, *state.StateDB, error) {
 	// set the receiver's (the executing contract) code for execution.
 	cfg.State.SetCode(address, code)
 	// Call the code with the given configuration.
-	ret, _, err := vmenv.Call(
+	ret, _, failed, err := vmenv.Call(
 		sender,
 		common.StringToAddress("contract"),
 		input,
@@ -121,11 +121,11 @@ func Execute(code, input []byte, cfg *Config) ([]byte, *state.StateDB, error) {
 		cfg.Value,
 	)
 
-	return ret, cfg.State, err
+	return ret, cfg.State, failed, err
 }
 
 // Create executes the code using the EVM create method
-func Create(input []byte, cfg *Config) ([]byte, common.Address, uint64, error) {
+func Create(input []byte, cfg *Config) ([]byte, common.Address, uint64, bool, error) {
 	if cfg == nil {
 		cfg = new(Config)
 	}
@@ -141,13 +141,13 @@ func Create(input []byte, cfg *Config) ([]byte, common.Address, uint64, error) {
 	)
 
 	// Call the code with the given configuration.
-	code, address, leftOverGas, err := vmenv.Create(
+	code, address, leftOverGas, failed, err := vmenv.Create(
 		sender,
 		input,
 		cfg.GasLimit,
 		cfg.Value,
 	)
-	return code, address, leftOverGas, err
+	return code, address, leftOverGas, failed, err
 }
 
 // Call executes the code given by the contract's address. It will return the
@@ -155,14 +155,14 @@ func Create(input []byte, cfg *Config) ([]byte, common.Address, uint64, error) {
 //
 // Call, unlike Execute, requires a config and also requires the State field to
 // be set.
-func Call(address common.Address, input []byte, cfg *Config) ([]byte, uint64, error) {
+func Call(address common.Address, input []byte, cfg *Config) ([]byte, uint64, bool, error) {
 	setDefaults(cfg)
 
 	vmenv := NewEnv(cfg, cfg.State)
 
 	sender := cfg.State.GetOrNewStateObject(cfg.Origin)
 	// Call the code with the given configuration.
-	ret, leftOverGas, err := vmenv.Call(
+	ret, leftOverGas, failed, err := vmenv.Call(
 		sender,
 		address,
 		input,
@@ -170,5 +170,5 @@ func Call(address common.Address, input []byte, cfg *Config) ([]byte, uint64, er
 		cfg.Value,
 	)
 
-	return ret, leftOverGas, err
+	return ret, leftOverGas, failed, err
 }
diff --git a/core/vm/runtime/runtime_example_test.go b/core/vm/runtime/runtime_example_test.go
index b7d0ddc384..d183b3c22f 100644
--- a/core/vm/runtime/runtime_example_test.go
+++ b/core/vm/runtime/runtime_example_test.go
@@ -24,7 +24,7 @@ import (
 )
 
 func ExampleExecute() {
-	ret, _, err := runtime.Execute(common.Hex2Bytes("6060604052600a8060106000396000f360606040526008565b00"), nil, nil)
+	ret, _, _, err := runtime.Execute(common.Hex2Bytes("6060604052600a8060106000396000f360606040526008565b00"), nil, nil)
 	if err != nil {
 		fmt.Println(err)
 	}
diff --git a/core/vm/runtime/runtime_test.go b/core/vm/runtime/runtime_test.go
index 2c4dc50265..0a72853812 100644
--- a/core/vm/runtime/runtime_test.go
+++ b/core/vm/runtime/runtime_test.go
@@ -75,7 +75,7 @@ func TestEVM(t *testing.T) {
 }
 
 func TestExecute(t *testing.T) {
-	ret, _, err := Execute([]byte{
+	ret, _, _, err := Execute([]byte{
 		byte(vm.PUSH1), 10,
 		byte(vm.PUSH1), 0,
 		byte(vm.MSTORE),
@@ -106,7 +106,7 @@ func TestCall(t *testing.T) {
 		byte(vm.RETURN),
 	})
 
-	ret, _, err := Call(address, nil, &Config{State: state})
+	ret, _, _, err := Call(address, nil, &Config{State: state})
 	if err != nil {
 		t.Fatal("didn't expect error", err)
 	}
@@ -117,6 +117,143 @@ func TestCall(t *testing.T) {
 	}
 }
 
+func TestTransactionReverted(t *testing.T) {
+	/*
+	 	   	Contract Source Code
+	 	   	```
+	 	   	contract Demo {
+	 	       		function Demo() {}
+	 	       		function IllegalDivision() returns(int) {
+	 	           		var dividend = 0;
+	 	           		return 1 / dividend;
+	 	       		}
+	 	       		function LegalDivision() returns(int) {
+	 	           		var dividend = 1;
+	 	           		return 1 / dividend;
+	        		}
+	 	   	}
+	 	   	```
+	*/
+	var definition = `[{"constant":false,"inputs":[],"name":"LegalDivision","outputs":[{"name":"","type":"int256"}],"payable":false,"type":"function"},{"constant":false,"inputs":[],"name":"IllegalDivision","outputs":[{"name":"","type":"int256"}],"payable":false,"type":"function"},{"inputs":[],"payable":false,"type":"constructor"}]`
+	var rawcode = common.Hex2Bytes("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")
+
+	abi, err := abi.JSON(strings.NewReader(definition))
+	if err != nil {
+		t.Fatal(err)
+	}
+
+	legalDivision, err := abi.Pack("LegalDivision")
+	if err != nil {
+		t.Fatal(err)
+	}
+
+	illegalDivision, err := abi.Pack("IllegalDivision")
+	if err != nil {
+		t.Fatal(err)
+	}
+	var failed bool
+	// deploy
+	cfg := &Config{
+		Origin: common.HexToAddress("sender"),
+	}
+	code, _, _, _, err := Create(rawcode, cfg)
+	if err != nil {
+		t.Fatal(err)
+	}
+	_, _, failed, _ = Execute(code, legalDivision, cfg)
+	if failed != false {
+		t.Fatal("Expect false, got true")
+	}
+	_, _, failed, _ = Execute(code, illegalDivision, cfg)
+	if failed != true {
+		t.Fatal("Expect true, got false")
+	}
+}
+
+func TestDelegateReverted(t *testing.T) {
+	/*
+		 		Contract Source Code
+		 		```
+		 		contract Relay {
+		 		    address public currentVersion;
+		 		    address public owner;
+
+				    modifier onlyOwner() {
+		 			if (msg.sender != owner) {
+		 			    throw;
+		 			}
+		 			_;
+		 		    }
+		 		    function Relay(address _address) {
+		 			currentVersion = _address;
+		 			owner = msg.sender;
+		 		    }
+		 		    function changeContract(address newVersion) public
+		 		    onlyOwner()
+		 		    {
+		 			currentVersion = newVersion;
+		 		    }
+		 		    function() {
+		 			if(!currentVersion.delegatecall(msg.data)) throw;
+		 		    }
+				}
+
+		 		contract Demo {
+		 		    function Demo() {
+		 		    }
+		 		    function IllegalDivision() returns(int) {
+		 			var dividend = 0;
+		 			return 1 / dividend;
+		 		    }
+		 		    function LegalDivision() returns(int) {
+		 			var dividend = 1;
+		 			return 1 / dividend;
+		 		    }
+		 		}
+		 		```
+	*/
+	var definition = `[{"constant":false,"inputs":[],"name":"LegalDivision","outputs":[{"name":"","type":"int256"}],"payable":false,"type":"function"},{"constant":false,"inputs":[],"name":"IllegalDivision","outputs":[{"name":"","type":"int256"}],"payable":false,"type":"function"},{"inputs":[],"payable":false,"type":"constructor"}]`
+	var rawcode1 = common.Hex2Bytes("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")
+	var rawcode2 = common.Hex2Bytes("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")
+
+	abi, err := abi.JSON(strings.NewReader(definition))
+	if err != nil {
+		t.Fatal(err)
+	}
+
+	legalDivision, err := abi.Pack("LegalDivision")
+	if err != nil {
+		t.Fatal(err)
+	}
+
+	illegalDivision, err := abi.Pack("IllegalDivision")
+	if err != nil {
+		t.Fatal(err)
+	}
+	var failed bool
+	// deploy
+	cfg := &Config{
+		Origin: common.HexToAddress("sender"),
+	}
+	_, addr, _, _, err := Create(rawcode1, cfg)
+	if err != nil {
+		t.Fatal(err)
+	}
+
+	_, addr2, _, _, err := Create(append(rawcode2, common.LeftPadBytes(addr.Bytes(), 32)...), cfg)
+	if err != nil {
+		t.Fatal(err)
+	}
+	_, _, failed, _ = Call(addr2, legalDivision, cfg)
+	if failed != false {
+		t.Fatal("Expect false, got true")
+	}
+	_, _, failed, _ = Call(addr2, illegalDivision, cfg)
+	if failed != true {
+		t.Fatal("Expect true, got false")
+	}
+}
+
 func BenchmarkCall(b *testing.B) {
 	var definition = `[{"constant":true,"inputs":[],"name":"seller","outputs":[{"name":"","type":"address"}],"type":"function"},{"constant":false,"inputs":[],"name":"abort","outputs":[],"type":"function"},{"constant":true,"inputs":[],"name":"value","outputs":[{"name":"","type":"uint256"}],"type":"function"},{"constant":false,"inputs":[],"name":"refund","outputs":[],"type":"function"},{"constant":true,"inputs":[],"name":"buyer","outputs":[{"name":"","type":"address"}],"type":"function"},{"constant":false,"inputs":[],"name":"confirmReceived","outputs":[],"type":"function"},{"constant":true,"inputs":[],"name":"state","outputs":[{"name":"","type":"uint8"}],"type":"function"},{"constant":false,"inputs":[],"name":"confirmPurchase","outputs":[],"type":"function"},{"inputs":[],"type":"constructor"},{"anonymous":false,"inputs":[],"name":"Aborted","type":"event"},{"anonymous":false,"inputs":[],"name":"PurchaseConfirmed","type":"event"},{"anonymous":false,"inputs":[],"name":"ItemReceived","type":"event"},{"anonymous":false,"inputs":[],"name":"Refunded","type":"event"}]`
 
diff --git a/eth/api.go b/eth/api.go
index 0d90759b6c..145a4f4823 100644
--- a/eth/api.go
+++ b/eth/api.go
@@ -543,7 +543,7 @@ func (api *PrivateDebugAPI) TraceTransaction(ctx context.Context, txHash common.
 
 	// Run the transaction with tracing enabled.
 	vmenv := vm.NewEVM(context, statedb, api.config, vm.Config{Debug: true, Tracer: tracer})
-	ret, gas, err := core.ApplyMessage(vmenv, msg, new(core.GasPool).AddGas(tx.Gas()))
+	ret, gas, failed, err := core.ApplyMessage(vmenv, msg, new(core.GasPool).AddGas(tx.Gas()))
 	if err != nil {
 		return nil, fmt.Errorf("tracing failed: %v", err)
 	}
@@ -553,6 +553,7 @@ func (api *PrivateDebugAPI) TraceTransaction(ctx context.Context, txHash common.
 			Gas:         gas,
 			ReturnValue: fmt.Sprintf("%x", ret),
 			StructLogs:  ethapi.FormatLogs(tracer.StructLogs()),
+			Failed:      failed,
 		}, nil
 	case *ethapi.JavascriptTracer:
 		return tracer.GetResult()
@@ -590,7 +591,7 @@ func (api *PrivateDebugAPI) computeTxEnv(blockHash common.Hash, txIndex int) (co
 
 		vmenv := vm.NewEVM(context, statedb, api.config, vm.Config{})
 		gp := new(core.GasPool).AddGas(tx.Gas())
-		_, _, err := core.ApplyMessage(vmenv, msg, gp)
+		_, _, _, err := core.ApplyMessage(vmenv, msg, gp)
 		if err != nil {
 			return nil, vm.Context{}, nil, fmt.Errorf("tx %x failed: %v", tx.Hash(), err)
 		}
diff --git a/internal/ethapi/api.go b/internal/ethapi/api.go
index c22c56dfb3..c4de6d8b1d 100644
--- a/internal/ethapi/api.go
+++ b/internal/ethapi/api.go
@@ -580,12 +580,12 @@ type CallArgs struct {
 	Data     hexutil.Bytes   `json:"data"`
 }
 
-func (s *PublicBlockChainAPI) doCall(ctx context.Context, args CallArgs, blockNr rpc.BlockNumber, vmCfg vm.Config) ([]byte, *big.Int, error) {
+func (s *PublicBlockChainAPI) doCall(ctx context.Context, args CallArgs, blockNr rpc.BlockNumber, vmCfg vm.Config) ([]byte, *big.Int, bool, error) {
 	defer func(start time.Time) { log.Debug("Executing EVM call finished", "runtime", time.Since(start)) }(time.Now())
 
 	state, header, err := s.b.StateAndHeaderByNumber(ctx, blockNr)
 	if state == nil || err != nil {
-		return nil, common.Big0, err
+		return nil, common.Big0, false, err
 	}
 	// Set sender address or use a default if none specified
 	addr := args.From
@@ -623,7 +623,7 @@ func (s *PublicBlockChainAPI) doCall(ctx context.Context, args CallArgs, blockNr
 	// Get a new instance of the EVM.
 	evm, vmError, err := s.b.GetEVM(ctx, msg, state, header, vmCfg)
 	if err != nil {
-		return nil, common.Big0, err
+		return nil, common.Big0, false, err
 	}
 	// Wait for the context to be done and cancel the evm. Even if the
 	// EVM has finished, cancelling may be done (repeatedly)
@@ -637,17 +637,17 @@ func (s *PublicBlockChainAPI) doCall(ctx context.Context, args CallArgs, blockNr
 	// Setup the gas pool (also for unmetered requests)
 	// and apply the message.
 	gp := new(core.GasPool).AddGas(math.MaxBig256)
-	res, gas, err := core.ApplyMessage(evm, msg, gp)
+	res, gas, failed, err := core.ApplyMessage(evm, msg, gp)
 	if err := vmError(); err != nil {
-		return nil, common.Big0, err
+		return nil, common.Big0, false, err
 	}
-	return res, gas, err
+	return res, gas, failed, err
 }
 
 // Call executes the given transaction on the state for the given block number.
 // It doesn't make and changes in the state/blockchain and is useful to execute and retrieve values.
 func (s *PublicBlockChainAPI) Call(ctx context.Context, args CallArgs, blockNr rpc.BlockNumber) (hexutil.Bytes, error) {
-	result, _, err := s.doCall(ctx, args, blockNr, vm.Config{DisableGasMetering: true})
+	result, _, _, err := s.doCall(ctx, args, blockNr, vm.Config{DisableGasMetering: true})
 	return (hexutil.Bytes)(result), err
 }
 
@@ -670,10 +670,10 @@ func (s *PublicBlockChainAPI) EstimateGas(ctx context.Context, args CallArgs) (*
 		mid := (hi + lo) / 2
 		(*big.Int)(&args.Gas).SetUint64(mid)
 
-		_, gas, err := s.doCall(ctx, args, rpc.PendingBlockNumber, vm.Config{})
+		_, _, failed, err := s.doCall(ctx, args, rpc.PendingBlockNumber, vm.Config{})
 
-		// If the transaction became invalid or used all the gas (failed), raise the gas limit
-		if err != nil || gas.Cmp((*big.Int)(&args.Gas)) == 0 {
+		// If the transaction became invalid or failed, raise the gas limit
+		if err != nil || failed {
 			lo = mid
 			continue
 		}
@@ -690,6 +690,7 @@ type ExecutionResult struct {
 	Gas         *big.Int       `json:"gas"`
 	ReturnValue string         `json:"returnValue"`
 	StructLogs  []StructLogRes `json:"structLogs"`
+	Failed      bool           `json:"failed"`
 }
 
 // StructLogRes stores a structured log emitted by the EVM while replaying a
diff --git a/les/odr_test.go b/les/odr_test.go
index 3a0fd6738f..f56c4036d4 100644
--- a/les/odr_test.go
+++ b/les/odr_test.go
@@ -127,7 +127,7 @@ func odrContractCall(ctx context.Context, db ethdb.Database, config *params.Chai
 
 				//vmenv := core.NewEnv(statedb, config, bc, msg, header, vm.Config{})
 				gp := new(core.GasPool).AddGas(math.MaxBig256)
-				ret, _, _ := core.ApplyMessage(vmenv, msg, gp)
+				ret, _, _, _ := core.ApplyMessage(vmenv, msg, gp)
 				res = append(res, ret...)
 			}
 		} else {
@@ -138,7 +138,7 @@ func odrContractCall(ctx context.Context, db ethdb.Database, config *params.Chai
 			context := core.NewEVMContext(msg, header, lc, nil)
 			vmenv := vm.NewEVM(context, state, config, vm.Config{})
 			gp := new(core.GasPool).AddGas(math.MaxBig256)
-			ret, _, _ := core.ApplyMessage(vmenv, msg, gp)
+			ret, _, _, _ := core.ApplyMessage(vmenv, msg, gp)
 			if state.Error() == nil {
 				res = append(res, ret...)
 			}
diff --git a/light/odr_test.go b/light/odr_test.go
index 544b64effc..9b5168fbc9 100644
--- a/light/odr_test.go
+++ b/light/odr_test.go
@@ -181,7 +181,7 @@ func odrContractCall(ctx context.Context, db ethdb.Database, bc *core.BlockChain
 		context := core.NewEVMContext(msg, header, chain, nil)
 		vmenv := vm.NewEVM(context, st, config, vm.Config{})
 		gp := new(core.GasPool).AddGas(math.MaxBig256)
-		ret, _, _ := core.ApplyMessage(vmenv, msg, gp)
+		ret, _, _, _ := core.ApplyMessage(vmenv, msg, gp)
 		res = append(res, ret...)
 		if st.Error() != nil {
 			return res, st.Error()
diff --git a/tests/state_test_util.go b/tests/state_test_util.go
index 58acdd488b..64cb9bd4a0 100644
--- a/tests/state_test_util.go
+++ b/tests/state_test_util.go
@@ -188,7 +188,7 @@ func RunState(chainConfig *params.ChainConfig, statedb *state.StateDB, db ethdb.
 	gaspool := new(core.GasPool).AddGas(math.MustParseBig256(env["currentGasLimit"]))
 
 	snapshot := statedb.Snapshot()
-	ret, _, err := core.ApplyMessage(environment, msg, gaspool)
+	ret, _, _, err := core.ApplyMessage(environment, msg, gaspool)
 	if err != nil {
 		statedb.RevertToSnapshot(snapshot)
 	}
diff --git a/tests/vm_test_util.go b/tests/vm_test_util.go
index e7fe74f49b..369b17d415 100644
--- a/tests/vm_test_util.go
+++ b/tests/vm_test_util.go
@@ -230,6 +230,6 @@ func RunVm(statedb *state.StateDB, env, exec map[string]string) ([]byte, []*type
 	vm.PrecompiledContracts = make(map[common.Address]vm.PrecompiledContract)
 
 	environment, _ := NewEVMEnvironment(true, chainConfig, statedb, env, exec)
-	ret, g, err := environment.Call(caller, to, data, gas.Uint64(), value)
+	ret, g, _, err := environment.Call(caller, to, data, gas.Uint64(), value)
 	return ret, statedb.Logs(), new(big.Int).SetUint64(g), err
 }