diff --git a/src/libcore/str.rs b/src/libcore/str.rs
index 800e2dcc2789..3c489719496d 100644
--- a/src/libcore/str.rs
+++ b/src/libcore/str.rs
@@ -419,6 +419,8 @@ struct TwoWaySearcher {
     memory: uint
 }
 
+// This is the Two-Way search algorithm, which was introduced in the paper:
+// Crochemore, M., Perrin, D., 1991, Two-way string-matching, Journal of the ACM 38(3):651-675.
 impl TwoWaySearcher {
     fn new(needle: &[u8]) -> TwoWaySearcher {
         let (critPos1, period1) = TwoWaySearcher::maximal_suffix(needle, false);
@@ -437,7 +439,10 @@ impl TwoWaySearcher {
         let byteset = needle.iter()
                             .fold(0, |a, &b| (1 << ((b & 0x3f) as uint)) | a);
 
-        if needle.slice_to(critPos) == needle.slice_from(needle.len() - critPos) {
+        // Check if the needle is periodic. If so, during searching when we
+        // find a mismatch, we must only advance the position by the length
+        // of the period, not the length of the entire needle
+        if needle.slice_to(critPos) == needle.slice(period, period + critPos) {
             TwoWaySearcher {
                 critPos: critPos,
                 period: period,
diff --git a/src/libcoretest/str.rs b/src/libcoretest/str.rs
index bac8d509b131..be2275dcd4a0 100644
--- a/src/libcoretest/str.rs
+++ b/src/libcoretest/str.rs
@@ -8,7 +8,27 @@
 // option. This file may not be copied, modified, or distributed
 // except according to those terms.
 
+fn check_contains_all_substrings(s: &str) {
+    assert!(s.contains(""));
+    for i in range(0, s.len()) {
+        for j in range(i+1, s.len() + 1) {
+            assert!(s.contains(s.slice(i, j)));
+        }
+    }
+}
+
 #[test]
 fn strslice_issue_16589() {
     assert!("bananas".contains("nana"));
+
+    // prior to the fix for #16589, x.contains("abcdabcd") returned false
+    // test all substrings for good measure
+    check_contains_all_substrings("012345678901234567890123456789bcdabcdabcd");
+}
+
+
+#[test]
+fn test_strslice_contains() {
+    let x = "There are moments, Jeeves, when one asks oneself, 'Do trousers matter?'";
+    check_contains_all_substrings(x);
 }