diff --git a/spring-data-rest-webmvc/src/main/java/org/springframework/data/rest/webmvc/RepositoryEntityController.java b/spring-data-rest-webmvc/src/main/java/org/springframework/data/rest/webmvc/RepositoryEntityController.java
index f526e23b8..120207b88 100644
--- a/spring-data-rest-webmvc/src/main/java/org/springframework/data/rest/webmvc/RepositoryEntityController.java
+++ b/spring-data-rest-webmvc/src/main/java/org/springframework/data/rest/webmvc/RepositoryEntityController.java
@@ -321,12 +321,13 @@ class RepositoryEntityController extends AbstractRepositoryRestController implem
 		List<String> ifNoneMatch = headers.getIfNoneMatch();
 		ETag eTag = ifNoneMatch.isEmpty() ? ETag.NO_ETAG : ETag.from(ifNoneMatch.get(0));
 		PersistentEntity<?, ?> entity = resourceInformation.getPersistentEntity();
+		HttpHeaders responseHeaders = prepareHeaders(entity, domainObj);
 
 		if (eTag.matches(entity, domainObj)) {
-			return new ResponseEntity<Resource<?>>(prepareHeaders(entity, domainObj), HttpStatus.NOT_MODIFIED);
+			return new ResponseEntity<Resource<?>>(responseHeaders, HttpStatus.NOT_MODIFIED);
 		}
 
-		// Check last modification for If-Modfied-Since
+		// Check last modification for If-Modified-Since
 
 		if (headers.getIfModifiedSince() != -1) {
 
@@ -334,12 +335,12 @@ class RepositoryEntityController extends AbstractRepositoryRestController implem
 			long current = wrapper.getLastModifiedDate().getTimeInMillis() / 1000 * 1000;
 
 			if (current <= headers.getIfModifiedSince()) {
-				return new ResponseEntity<Resource<?>>(prepareHeaders(entity, domainObj), HttpStatus.NOT_MODIFIED);
+				return new ResponseEntity<Resource<?>>(responseHeaders, HttpStatus.NOT_MODIFIED);
 			}
 		}
 
 		PersistentEntityResource resource = assembler.toFullResource(domainObj);
-		return new ResponseEntity<Resource<?>>(resource, prepareHeaders(resource), HttpStatus.OK);
+		return new ResponseEntity<Resource<?>>(resource, responseHeaders, HttpStatus.OK);
 	}
 
 	/**
diff --git a/spring-data-rest-webmvc/src/test/java/org/springframework/data/rest/webmvc/RepositoryEntityControllerIntegrationTests.java b/spring-data-rest-webmvc/src/test/java/org/springframework/data/rest/webmvc/RepositoryEntityControllerIntegrationTests.java
index 83d351ee5..48a3b2c3d 100644
--- a/spring-data-rest-webmvc/src/test/java/org/springframework/data/rest/webmvc/RepositoryEntityControllerIntegrationTests.java
+++ b/spring-data-rest-webmvc/src/test/java/org/springframework/data/rest/webmvc/RepositoryEntityControllerIntegrationTests.java
@@ -23,8 +23,10 @@ import static org.springframework.http.HttpMethod.*;
 import java.util.List;
 
 import org.junit.Test;
+import org.mockito.Mockito;
 import org.springframework.beans.factory.annotation.Autowired;
 import org.springframework.data.mapping.context.PersistentEntities;
+import org.springframework.data.projection.SpelAwareProxyProjectionFactory;
 import org.springframework.data.rest.core.config.RepositoryRestConfiguration;
 import org.springframework.data.rest.webmvc.jpa.Address;
 import org.springframework.data.rest.webmvc.jpa.AddressRepository;
@@ -33,12 +35,14 @@ import org.springframework.data.rest.webmvc.jpa.JpaRepositoryConfig;
 import org.springframework.data.rest.webmvc.jpa.Order;
 import org.springframework.data.rest.webmvc.jpa.Person;
 import org.springframework.data.rest.webmvc.support.ETag;
+import org.springframework.hateoas.Resource;
 import org.springframework.http.HttpEntity;
 import org.springframework.http.HttpStatus;
 import org.springframework.http.MediaType;
 import org.springframework.http.ResponseEntity;
 import org.springframework.test.context.ContextConfiguration;
 import org.springframework.transaction.annotation.Transactional;
+import org.springframework.util.LinkedMultiValueMap;
 import org.springframework.web.HttpRequestMethodNotSupportedException;
 
 /**
@@ -244,4 +248,29 @@ public class RepositoryEntityControllerIntegrationTests extends AbstractControll
 				is(false));
 		assertThat(controller.postCollectionResource(request, persistentEntityResource, assembler, "").hasBody(), is(false));
 	}
+
+	/**
+	 * @see DATAREST-581
+	 */
+	@Test
+	public void createsEtagForProjectedEntityCorrectly() throws Exception {
+
+		Address address = repository.save(new Address());
+
+		PersistentEntityResourceAssembler assembler = Mockito.mock(PersistentEntityResourceAssembler.class);
+		AddressProjection addressProjection = new SpelAwareProxyProjectionFactory()
+				.createProjection(AddressProjection.class);
+
+		PersistentEntityResource resource = PersistentEntityResource
+				.build(addressProjection, entities.getPersistentEntity(Address.class)).build();
+
+		Mockito.when(assembler.toFullResource(Mockito.any(Object.class))).thenReturn(resource);
+
+		ResponseEntity<Resource<?>> entity = controller.getItemResource(getResourceInformation(Address.class), address.id,
+				assembler, new LinkedMultiValueMap<String, String>());
+
+		assertThat(entity.getHeaders().getETag(), is(notNullValue()));
+	}
+
+	interface AddressProjection {}
 }
diff --git a/spring-data-rest-webmvc/src/test/java/org/springframework/data/rest/webmvc/jpa/Address.java b/spring-data-rest-webmvc/src/test/java/org/springframework/data/rest/webmvc/jpa/Address.java
index b4ac3fb21..1ae854732 100644
--- a/spring-data-rest-webmvc/src/test/java/org/springframework/data/rest/webmvc/jpa/Address.java
+++ b/spring-data-rest-webmvc/src/test/java/org/springframework/data/rest/webmvc/jpa/Address.java
@@ -18,6 +18,7 @@ package org.springframework.data.rest.webmvc.jpa;
 import javax.persistence.Entity;
 import javax.persistence.GeneratedValue;
 import javax.persistence.Id;
+import javax.persistence.Version;
 
 /**
  * @author Oliver Gierke
@@ -26,4 +27,5 @@ import javax.persistence.Id;
 public class Address {
 
 	public @Id @GeneratedValue Long id;
+	public @Version Long version;
 }