diff --git a/module/ice-9/read.scm b/module/ice-9/read.scm
index ac407739f..283933064 100644
--- a/module/ice-9/read.scm
+++ b/module/ice-9/read.scm
@@ -556,12 +556,15 @@
     (string->symbol
      (list->string
       (let lp ((saw-brace? #f))
-        (let ((ch (next-not-eof)))
+        (let lp/inner ((ch (next-not-eof))
+                       (saw-brace? saw-brace?))
           (cond
            (saw-brace?
             (if (eqv? ch #\#)
                 '()
-                (cons #\} (lp #f))))
+                ;; Don't eat CH, see
+                ;; <https://debbugs.gnu.org/cgi/bugreport.cgi?bug=49623>.
+                (cons #\} (lp/inner ch #f))))
            ((eqv? ch #\})
             (lp #t))
            ((eqv? ch #\\)
diff --git a/test-suite/tests/reader.test b/test-suite/tests/reader.test
index 1481a0a5d..ad7c6d575 100644
--- a/test-suite/tests/reader.test
+++ b/test-suite/tests/reader.test
@@ -536,6 +536,11 @@
 
 (with-test-prefix "#{}#"
   (pass-if (equal? (read-string "#{}#") '#{}#))
+  ;; See <https://debbugs.gnu.org/cgi/bugreport.cgi?bug=49623>
+  (pass-if (equal? (read-string "#{}}#") (string->symbol "}")))
+  (pass-if (equal? (read-string "#{}}}#") (string->symbol "}}")))
+  (pass-if (equal? (read-string "#{{}}#") (string->symbol "{}")))
+  (pass-if (equal? (read-string "#{{}b}#") (string->symbol "{}b")))
   (pass-if (not (equal? (read-string "(a #{.}# b)") '(a . b))))
   (pass-if (equal? (read-string "#{a}#") 'a))
   (pass-if (equal? (read-string "#{a b}#") '#{a b}#))