diff --git a/avocado/core/test.py b/avocado/core/test.py
index 77a836c986393e8afaf20d9ef4da5509337b15ab..2797333e9679010927fc6e46b4118eb397007862 100644
--- a/avocado/core/test.py
+++ b/avocado/core/test.py
@@ -359,8 +359,9 @@ class Test(unittest.TestCase):
         except exceptions.TestNAError, details:
             stacktrace.log_exc_info(sys.exc_info(), logger='avocado.test')
             raise exceptions.TestNAError(details)
-        except Exception, details:
+        except:     # Old-style exceptions are not inherited from Exception()
             stacktrace.log_exc_info(sys.exc_info(), logger='avocado.test')
+            details = sys.exc_info()[1]
             raise exceptions.TestSetupFail(details)
         try:
             testMethod()
@@ -371,8 +372,11 @@ class Test(unittest.TestCase):
                                 'must fix your test. Original skip exception: '
                                 '%s' % details)
             raise exceptions.TestError(skip_illegal_msg)
-        except Exception, details:
+        except:     # Old-style exceptions are not inherited from Exception()
             stacktrace.log_exc_info(sys.exc_info(), logger='avocado.test')
+            details = sys.exc_info()[1]
+            if not isinstance(details, Exception):  # Avoid passing nasty exc
+                details = exceptions.TestError("%r: %s" % (details, details))
             test_exception = details
         finally:
             try:
@@ -384,9 +388,10 @@ class Test(unittest.TestCase):
                                     'you must fix your test. Original skip '
                                     'exception: %s' % details)
                 raise exceptions.TestError(skip_illegal_msg)
-            except Exception, details:
+            except:     # avoid old-style exception failures
                 stacktrace.log_exc_info(sys.exc_info(), logger='avocado.test')
-                cleanup_exception = details
+                details = sys.exc_info()[1]
+                cleanup_exception = exceptions.TestSetupFail(details)
 
         whiteboard_file = os.path.join(self.logdir, 'whiteboard')
         genio.write_file(whiteboard_file, self.whiteboard)
@@ -423,7 +428,7 @@ class Test(unittest.TestCase):
         if test_exception is not None:
             raise test_exception
         elif cleanup_exception is not None:
-            raise exceptions.TestSetupFail(cleanup_exception)
+            raise cleanup_exception
         elif stdout_check_exception is not None:
             raise stdout_check_exception
         elif stderr_check_exception is not None:
diff --git a/examples/tests/failtest_nasty3.py b/examples/tests/failtest_nasty3.py
new file mode 100755
index 0000000000000000000000000000000000000000..b698f923b6cad4044b0d2a01b258d4f27809c36a
--- /dev/null
+++ b/examples/tests/failtest_nasty3.py
@@ -0,0 +1,32 @@
+#!/usr/bin/python
+
+from avocado import Test
+from avocado import main
+
+
+class NastyException:
+
+    """ Please never use something like this!!! (old-style exception) """
+
+    def __init__(self, msg):
+        self.msg = msg
+
+    def __str__(self):
+        return self.msg
+
+
+class FailTest(Test):
+
+    """
+    This test raises old-style-class exception
+    """
+
+    def test(self):
+        """
+        Should fail not-that-badly
+        """
+        raise NastyException("Nasty-string-like-exception")
+
+
+if __name__ == "__main__":
+    main()
diff --git a/selftests/functional/test_standalone.py b/selftests/functional/test_standalone.py
index e8f66abc59a12ce045b7968e8a499bcb69c5ae68..d1363400d85911f099c514b5e61752cd295009ce 100644
--- a/selftests/functional/test_standalone.py
+++ b/selftests/functional/test_standalone.py
@@ -62,6 +62,13 @@ class StandaloneTests(unittest.TestCase):
         self.assertIn("Exception: Unable to get exception, check the traceback"
                       " for details.", result.stdout)
 
+    def test_failtest_nasty3(self):
+        cmd_line = './examples/tests/failtest_nasty3.py -r'
+        expected_rc = 1
+        result = self.run_and_check(cmd_line, expected_rc, 'failtest_nasty3')
+        self.assertIn("TestError: <failtest_nasty3.NastyException instance at ",
+                      result.stdout)
+
     def test_errortest(self):
         cmd_line = './examples/tests/errortest.py -r'
         expected_rc = 1