new file mode 100644
--- /dev/null
+++ b/stream_udp_upstream.t
@@ -0,0 +1,141 @@
+#!/usr/bin/perl
+
+# (C) Sergey Kandaurov
+# (C) Nginx, Inc.
+
+# Stream tests for upstream module and balancers with datagrams.
+
+###############################################################################
+
+use warnings;
+use strict;
+
+use Test::More;
+
+BEGIN { use FindBin; chdir($FindBin::Bin); }
+
+use lib 'lib';
+use Test::Nginx;
+use Test::Nginx::Stream qw/ dgram /;
+
+###############################################################################
+
+select STDERR; $| = 1;
+select STDOUT; $| = 1;
+
+my $t = Test::Nginx->new()->has(qw/stream/)
+	->write_file_expand('nginx.conf', <<'EOF');
+
+%%TEST_GLOBALS%%
+
+daemon off;
+
+events {
+}
+
+stream {
+    proxy_responses      1;
+    proxy_timeout        1s;
+
+    upstream u {
+        server 127.0.0.1:8087;
+        server 127.0.0.1:8088;
+    }
+
+    upstream u2 {
+        server 127.0.0.1:8089 down;
+        server 127.0.0.1:8089;
+        server 127.0.0.1:8087;
+        server 127.0.0.1:8088;
+    }
+
+    upstream u3 {
+        server 127.0.0.1:8087;
+        server 127.0.0.1:8088 weight=2;
+    }
+
+    upstream u4 {
+        server 127.0.0.1:8089;
+        server 127.0.0.1:8087 backup;
+    }
+
+    server {
+        listen      127.0.0.1:8081 udp;
+        proxy_pass  u;
+    }
+
+    server {
+        listen      127.0.0.1:8082 udp;
+        proxy_pass  u2;
+    }
+
+    server {
+        listen      127.0.0.1:8083 udp;
+        proxy_pass  u3;
+    }
+
+    server {
+        listen      127.0.0.1:8084 udp;
+        proxy_pass  u4;
+    }
+}
+
+EOF
+
+$t->run_daemon(\&udp_daemon, 8087, $t);
+$t->run_daemon(\&udp_daemon, 8088, $t);
+$t->try_run('no stream udp')->plan(4);
+
+$t->waitforfile($t->testdir . '/8087');
+$t->waitforfile($t->testdir . '/8088');
+
+###############################################################################
+
+is(many('.', 30, peer => '127.0.0.1:8081'), '8087: 15, 8088: 15', 'balanced');
+is(many('.', 30, peer => '127.0.0.1:8082'), '8087: 15, 8088: 15', 'failures');
+is(many('.', 30, peer => '127.0.0.1:8083'), '8087: 10, 8088: 20', 'weight');
+is(many('.', 30, peer => '127.0.0.1:8084'), '8087: 30', 'backup');
+
+###############################################################################
+
+sub many {
+	my ($data, $count, %opts) = @_;
+	my (%ports, $peer);
+
+	$peer = $opts{peer};
+
+	for (1 .. $count) {
+		if (dgram($peer)->io($data) =~ /(\d+)/) {
+			$ports{$1} = 0 unless defined $ports{$1};
+			$ports{$1}++;
+		}
+	}
+
+	return join ', ', map { $_ . ": " . $ports{$_} } sort keys %ports;
+}
+
+###############################################################################
+
+sub udp_daemon {
+	my ($port, $t) = @_;
+
+	my $server = IO::Socket::INET->new(
+		Proto => 'udp',
+		LocalAddr => '127.0.0.1:' . $port,
+		Reuse => 1,
+	)
+		or die "Can't create listening socket: $!\n";
+
+	# signal we are ready
+
+	open my $fh, '>', $t->testdir() . '/' . $port;
+	close $fh;
+
+	while (1) {
+		$server->recv(my $buffer, 65536);
+		$buffer = $server->sockport();
+		$server->send($buffer);
+	}
+}
+
+###############################################################################