diff --git a/org.springframework.integration/src/main/java/org/springframework/integration/channel/MessageChannelTemplate.java b/org.springframework.integration/src/main/java/org/springframework/integration/channel/MessageChannelTemplate.java
index 81a90c3ea5..d8237f2bf8 100644
--- a/org.springframework.integration/src/main/java/org/springframework/integration/channel/MessageChannelTemplate.java
+++ b/org.springframework.integration/src/main/java/org/springframework/integration/channel/MessageChannelTemplate.java
@@ -1,5 +1,5 @@
 /*
- * Copyright 2002-2008 the original author or authors.
+ * Copyright 2002-2009 the original author or authors.
  *
  * Licensed under the Apache License, Version 2.0 (the "License");
  * you may not use this file except in compliance with the License.
@@ -26,6 +26,7 @@ import org.apache.commons.logging.LogFactory;
 import org.springframework.beans.factory.InitializingBean;
 import org.springframework.integration.core.Message;
 import org.springframework.integration.core.MessageChannel;
+import org.springframework.integration.core.MessageHeaders;
 import org.springframework.integration.message.MessageBuilder;
 import org.springframework.integration.message.MessageDeliveryException;
 import org.springframework.integration.selector.MessageSelector;
@@ -171,8 +172,8 @@ public class MessageChannelTemplate implements InitializingBean {
 	public boolean send(final Message<?> message, final MessageChannel channel) {
 		TransactionTemplate txTemplate = this.getTransactionTemplate();
 		if (txTemplate != null) {
-			return (Boolean) txTemplate.execute(new TransactionCallback() {
-				public Object doInTransaction(TransactionStatus status) {
+			return txTemplate.execute(new TransactionCallback<Boolean>() {
+				public Boolean doInTransaction(TransactionStatus status) {
 					return doSend(message, channel);
 				}
 			});
@@ -190,8 +191,8 @@ public class MessageChannelTemplate implements InitializingBean {
 	public Message<?> receive(final PollableChannel channel) {
 		TransactionTemplate txTemplate = this.getTransactionTemplate();
 		if (txTemplate != null) {
-			return (Message<?>) txTemplate.execute(new TransactionCallback() {
-				public Object doInTransaction(TransactionStatus status) {
+			return txTemplate.execute(new TransactionCallback<Message<?>>() {
+				public Message<?> doInTransaction(TransactionStatus status) {
 					return doReceive(channel);
 				}
 			});
@@ -206,8 +207,8 @@ public class MessageChannelTemplate implements InitializingBean {
 	public Message<?> sendAndReceive(final Message<?> request, final MessageChannel channel) {
 		TransactionTemplate txTemplate = this.getTransactionTemplate();
 		if (txTemplate != null) {
-			return (Message<?>) txTemplate.execute(new TransactionCallback() {
-				public Object doInTransaction(TransactionStatus status) {
+			return txTemplate.execute(new TransactionCallback<Message<?>>() {
+				public Message<?> doInTransaction(TransactionStatus status) {
 					return doSendAndReceive(request, channel);
 				}
 			});
@@ -240,6 +241,8 @@ public class MessageChannelTemplate implements InitializingBean {
 	}
 
 	private Message<?> doSendAndReceive(Message<?> request, MessageChannel channel) {
+		Object originalReplyChannelHeader = request.getHeaders().getReplyChannel();
+		Object originalErrorChannelHeader = request.getHeaders().getErrorChannel();
 		TemporaryReplyChannel replyChannel = new TemporaryReplyChannel(this.receiveTimeout);
 		request = MessageBuilder.fromMessage(request)
 				.setReplyChannel(replyChannel)
@@ -248,7 +251,14 @@ public class MessageChannelTemplate implements InitializingBean {
 		if (!this.doSend(request, channel)) {
 			throw new MessageDeliveryException(request, "failed to send message to channel");
 		}
-		return this.doReceive(replyChannel);
+		Message<?> reply = this.doReceive(replyChannel);
+		if (reply != null) {
+			reply = MessageBuilder.fromMessage(reply)
+					.setHeader(MessageHeaders.REPLY_CHANNEL, originalReplyChannelHeader)
+					.setHeader(MessageHeaders.ERROR_CHANNEL, originalErrorChannelHeader)
+					.build();
+		}
+		return reply;
 	}
 
 	private MessageChannel getRequiredDefaultChannel() {
diff --git a/org.springframework.integration/src/test/java/org/springframework/integration/gateway/NestedGatewayTests.java b/org.springframework.integration/src/test/java/org/springframework/integration/gateway/NestedGatewayTests.java
new file mode 100644
index 0000000000..fa9a2aef16
--- /dev/null
+++ b/org.springframework.integration/src/test/java/org/springframework/integration/gateway/NestedGatewayTests.java
@@ -0,0 +1,100 @@
+/*
+ * Copyright 2002-2009 the original author or authors.
+ *
+ * Licensed under the Apache License, Version 2.0 (the "License");
+ * you may not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *      http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing, software
+ * distributed under the License is distributed on an "AS IS" BASIS,
+ * WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+ * See the License for the specific language governing permissions and
+ * limitations under the License.
+ */
+
+package org.springframework.integration.gateway;
+
+import static org.junit.Assert.assertEquals;
+
+import org.junit.Test;
+
+import org.springframework.integration.channel.DirectChannel;
+import org.springframework.integration.core.Message;
+import org.springframework.integration.handler.AbstractReplyProducingMessageHandler;
+import org.springframework.integration.message.MessageBuilder;
+
+/**
+ * @author Mark Fisher
+ */
+public class NestedGatewayTests {
+
+	@Test
+	public void nestedWithinHandler() {
+		DirectChannel innerChannel = new DirectChannel();
+		DirectChannel outerChannel = new DirectChannel();
+		innerChannel.subscribe(new AbstractReplyProducingMessageHandler() {
+			@Override
+			protected Object handleRequestMessage(Message<?> requestMessage) {
+				return requestMessage.getPayload() + "-reply";
+			}
+		});
+		final SimpleMessagingGateway innerGateway = new SimpleMessagingGateway();
+		innerGateway.setRequestChannel(innerChannel);
+		innerGateway.afterPropertiesSet();
+		outerChannel.subscribe(new AbstractReplyProducingMessageHandler() {
+			@Override
+			protected Object handleRequestMessage(Message<?> requestMessage) {
+				return innerGateway.sendAndReceiveMessage(
+						"pre-" + requestMessage.getPayload()).getPayload() + "-post";
+			}
+		});
+		SimpleMessagingGateway outerGateway = new SimpleMessagingGateway();
+		outerGateway.setRequestChannel(outerChannel);
+		outerGateway.afterPropertiesSet();
+		Message<?> reply = outerGateway.sendAndReceiveMessage("test");
+		assertEquals("pre-test-reply-post", reply.getPayload());
+	}
+
+	@Test
+	public void replyChannelRetained() {
+		DirectChannel requestChannel = new DirectChannel();
+		DirectChannel replyChannel = new DirectChannel();
+		requestChannel.subscribe(new AbstractReplyProducingMessageHandler() {
+			@Override
+			protected Object handleRequestMessage(Message<?> requestMessage) {
+				return requestMessage.getPayload() + "-reply";
+			}
+		});
+		SimpleMessagingGateway gateway = new SimpleMessagingGateway();
+		gateway.setRequestChannel(requestChannel);
+		gateway.afterPropertiesSet();
+		Message<?> message = MessageBuilder.withPayload("test")
+				.setReplyChannel(replyChannel).build();
+		Message<?> reply = gateway.sendAndReceiveMessage(message);
+		assertEquals("test-reply", reply.getPayload());
+		assertEquals(replyChannel, reply.getHeaders().getReplyChannel());
+	}
+
+	@Test
+	public void errorChannelRetained() {
+		DirectChannel requestChannel = new DirectChannel();
+		DirectChannel errorChannel = new DirectChannel();
+		requestChannel.subscribe(new AbstractReplyProducingMessageHandler() {
+			@Override
+			protected Object handleRequestMessage(Message<?> requestMessage) {
+				return requestMessage.getPayload() + "-reply";
+			}
+		});
+		SimpleMessagingGateway gateway = new SimpleMessagingGateway();
+		gateway.setRequestChannel(requestChannel);
+		gateway.afterPropertiesSet();
+		Message<?> message = MessageBuilder.withPayload("test")
+				.setErrorChannel(errorChannel).build();
+		Message<?> reply = gateway.sendAndReceiveMessage(message);
+		assertEquals("test-reply", reply.getPayload());
+		assertEquals(errorChannel, reply.getHeaders().getErrorChannel());
+	}
+
+}