diff --git a/qa/L0_backend_python/decoupled/decoupled_test.py b/qa/L0_backend_python/decoupled/decoupled_test.py
index f0ca870664..1fc862fd5c 100755
--- a/qa/L0_backend_python/decoupled/decoupled_test.py
+++ b/qa/L0_backend_python/decoupled/decoupled_test.py
@@ -289,6 +289,36 @@ def test_decoupled_execute_cancel(self):
         self.assertIn("[execute_cancel] Request not cancelled at 1.0 s", log_text)
         self.assertIn("[execute_cancel] Request cancelled at ", log_text)
 
+    def test_decoupled_raise_exception(self):
+        # The decoupled_raise_exception model raises an exception for the request.
+        # This test case is making sure that repeated exceptions are properly handled.
+
+        model_name = "decoupled_raise_exception"
+        shape = [2, 2]
+        number_of_requests = 10
+        user_data = UserData()
+        with grpcclient.InferenceServerClient("localhost:8001") as triton_client:
+            triton_client.start_stream(callback=partial(callback, user_data))
+
+            input_datas = []
+            for i in range(number_of_requests):
+                input_data = np.random.randn(*shape).astype(np.float32)
+                input_datas.append(input_data)
+                inputs = [
+                    grpcclient.InferInput(
+                        "IN", input_data.shape, np_to_triton_dtype(input_data.dtype)
+                    )
+                ]
+                inputs[0].set_data_from_numpy(input_data)
+                triton_client.async_stream_infer(model_name=model_name, inputs=inputs)
+
+            for i in range(number_of_requests):
+                result = user_data._completed_requests.get()
+                self.assertIs(type(result), InferenceServerException)
+                self.assertIn("Intentional Error", result.message())
+
+            self.assertTrue(triton_client.is_model_ready(model_name))
+
 
 if __name__ == "__main__":
     unittest.main()
diff --git a/qa/L0_backend_python/decoupled/models/decoupled_raise_exception/1/model.py b/qa/L0_backend_python/decoupled/models/decoupled_raise_exception/1/model.py
new file mode 100644
index 0000000000..03a19db98d
--- /dev/null
+++ b/qa/L0_backend_python/decoupled/models/decoupled_raise_exception/1/model.py
@@ -0,0 +1,35 @@
+# Copyright 2023, NVIDIA CORPORATION & AFFILIATES. All rights reserved.
+#
+# Redistribution and use in source and binary forms, with or without
+# modification, are permitted provided that the following conditions
+# are met:
+#  * Redistributions of source code must retain the above copyright
+#    notice, this list of conditions and the following disclaimer.
+#  * Redistributions in binary form must reproduce the above copyright
+#    notice, this list of conditions and the following disclaimer in the
+#    documentation and/or other materials provided with the distribution.
+#  * Neither the name of NVIDIA CORPORATION nor the names of its
+#    contributors may be used to endorse or promote products derived
+#    from this software without specific prior written permission.
+#
+# THIS SOFTWARE IS PROVIDED BY THE COPYRIGHT HOLDERS ``AS IS'' AND ANY
+# EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, THE
+# IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
+# PURPOSE ARE DISCLAIMED.  IN NO EVENT SHALL THE COPYRIGHT OWNER OR
+# CONTRIBUTORS BE LIABLE FOR ANY DIRECT, INDIRECT, INCIDENTAL, SPECIAL,
+# EXEMPLARY, OR CONSEQUENTIAL DAMAGES (INCLUDING, BUT NOT LIMITED TO,
+# PROCUREMENT OF SUBSTITUTE GOODS OR SERVICES; LOSS OF USE, DATA, OR
+# PROFITS; OR BUSINESS INTERRUPTION) HOWEVER CAUSED AND ON ANY THEORY
+# OF LIABILITY, WHETHER IN CONTRACT, STRICT LIABILITY, OR TORT
+# (INCLUDING NEGLIGENCE OR OTHERWISE) ARISING IN ANY WAY OUT OF THE USE
+# OF THIS SOFTWARE, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGE.
+
+
+class TritonPythonModel:
+    def initialize(self, args):
+        pass
+
+    def execute(self, requests):
+        for request in requests:
+            raise Exception("Intentional Error")
+        return None
diff --git a/qa/L0_backend_python/decoupled/models/decoupled_raise_exception/config.pbtxt b/qa/L0_backend_python/decoupled/models/decoupled_raise_exception/config.pbtxt
new file mode 100644
index 0000000000..046687dfe7
--- /dev/null
+++ b/qa/L0_backend_python/decoupled/models/decoupled_raise_exception/config.pbtxt
@@ -0,0 +1,55 @@
+# Copyright 2023, NVIDIA CORPORATION & AFFILIATES. All rights reserved.
+#
+# Redistribution and use in source and binary forms, with or without
+# modification, are permitted provided that the following conditions
+# are met:
+#  * Redistributions of source code must retain the above copyright
+#    notice, this list of conditions and the following disclaimer.
+#  * Redistributions in binary form must reproduce the above copyright
+#    notice, this list of conditions and the following disclaimer in the
+#    documentation and/or other materials provided with the distribution.
+#  * Neither the name of NVIDIA CORPORATION nor the names of its
+#    contributors may be used to endorse or promote products derived
+#    from this software without specific prior written permission.
+#
+# THIS SOFTWARE IS PROVIDED BY THE COPYRIGHT HOLDERS ``AS IS'' AND ANY
+# EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, THE
+# IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
+# PURPOSE ARE DISCLAIMED.  IN NO EVENT SHALL THE COPYRIGHT OWNER OR
+# CONTRIBUTORS BE LIABLE FOR ANY DIRECT, INDIRECT, INCIDENTAL, SPECIAL,
+# EXEMPLARY, OR CONSEQUENTIAL DAMAGES (INCLUDING, BUT NOT LIMITED TO,
+# PROCUREMENT OF SUBSTITUTE GOODS OR SERVICES; LOSS OF USE, DATA, OR
+# PROFITS; OR BUSINESS INTERRUPTION) HOWEVER CAUSED AND ON ANY THEORY
+# OF LIABILITY, WHETHER IN CONTRACT, STRICT LIABILITY, OR TORT
+# (INCLUDING NEGLIGENCE OR OTHERWISE) ARISING IN ANY WAY OUT OF THE USE
+# OF THIS SOFTWARE, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGE.
+
+name: "decoupled_raise_exception"
+backend: "python"
+max_batch_size: 64
+
+model_transaction_policy {
+  decoupled: True
+}
+input [
+  {
+    name: "IN"
+    data_type: TYPE_FP32
+    dims: [ -1 ]
+  }
+]
+
+output [
+  {
+    name: "OUT"
+    data_type: TYPE_FP32
+    dims: [ -1 ]
+  }
+]
+
+instance_group [
+  {
+    count: 1
+    kind : KIND_CPU
+  }
+]
diff --git a/qa/L0_backend_python/decoupled/test.sh b/qa/L0_backend_python/decoupled/test.sh
index 3aa3e0f0cf..db8d4625f1 100755
--- a/qa/L0_backend_python/decoupled/test.sh
+++ b/qa/L0_backend_python/decoupled/test.sh
@@ -27,7 +27,7 @@
 
 CLIENT_PY=./decoupled_test.py
 CLIENT_LOG="./decoupled_client.log"
-EXPECTED_NUM_TESTS="6"
+EXPECTED_NUM_TESTS="7"
 TEST_RESULT_FILE='test_results.txt'
 TRITON_DIR=${TRITON_DIR:="/opt/tritonserver"}
 SERVER=${TRITON_DIR}/bin/tritonserver