diff --git a/python/src/com/jetbrains/python/inspections/PyUnreachableCodeInspection.java b/python/src/com/jetbrains/python/inspections/PyUnreachableCodeInspection.java
index d2be547aa163..d58457759b18 100644
--- a/python/src/com/jetbrains/python/inspections/PyUnreachableCodeInspection.java
+++ b/python/src/com/jetbrains/python/inspections/PyUnreachableCodeInspection.java
@@ -81,7 +81,7 @@ public class PyUnreachableCodeInspection extends LocalInspectionTool {
           final PsiElement e = instruction.getElement();
           if (colors[instruction.num()] != color){
             color = colors[instruction.num()];
-            if (!warned[color]){
+            if (color != 0 && !warned[color]){
               warned[color] = true;
               // Handle ensure parts
               if (e instanceof PyExceptPart) {
diff --git a/python/testData/codeInsight/controlflow/ifelsereturn.py b/python/testData/codeInsight/controlflow/ifelsereturn.py
new file mode 100644
index 000000000000..d7f810600c6f
--- /dev/null
+++ b/python/testData/codeInsight/controlflow/ifelsereturn.py
@@ -0,0 +1,7 @@
+if markup:
+    try:
+        return renderer
+    except KeyError:
+        raise Error
+else:
+    return body
\ No newline at end of file
diff --git a/python/testData/codeInsight/controlflow/ifelsereturn.txt b/python/testData/codeInsight/controlflow/ifelsereturn.txt
new file mode 100644
index 000000000000..5354aedb6509
--- /dev/null
+++ b/python/testData/codeInsight/controlflow/ifelsereturn.txt
@@ -0,0 +1,11 @@
+0(1) element: null
+1(2,8) element: PyIfStatement
+2(3) element: PyStatementList. Condition: markup:true
+3(4) element: PyTryExceptStatement
+4(5) element: PyTryPart
+5(10) element: PyReturnStatement
+6(7) element: PyExceptPart
+7(10) element: PyRaiseStatement
+8(9) element: PyElsePart. Condition: markup:false
+9(10) element: PyReturnStatement
+10() element: null
\ No newline at end of file
diff --git a/python/testSrc/com/jetbrains/python/PyControlFlowBuilderTest.java b/python/testSrc/com/jetbrains/python/PyControlFlowBuilderTest.java
index 9fcce023430c..391d56c820c8 100644
--- a/python/testSrc/com/jetbrains/python/PyControlFlowBuilderTest.java
+++ b/python/testSrc/com/jetbrains/python/PyControlFlowBuilderTest.java
@@ -78,6 +78,10 @@ public class PyControlFlowBuilderTest extends LightMarkedTestCase {
     doTest();
   }
 
+  public void testIfElseReturn() throws Exception {
+    doTest();
+  }
+
   public void testFunction() throws Exception {
     final String testName = getTestName(false).toLowerCase();
     configureByFile(testName + ".py");