diff --git a/py/showbc.c b/py/showbc.c
index fd1d512031..20a9790f99 100644
--- a/py/showbc.c
+++ b/py/showbc.c
@@ -135,12 +135,9 @@ void mp_show_byte_code(const byte *ip, int len) {
                 printf("STORE_SUBSCR");
                 break;
 
-                /*
             case MP_BC_DUP_TOP:
-                obj1 = *sp;
-                PUSH(obj1);
+                printf("DUP_TOP");
                 break;
-                */
 
             case MP_BC_DUP_TOP_TWO:
                 printf("DUP_TOP_TWO");
@@ -195,22 +192,20 @@ void mp_show_byte_code(const byte *ip, int len) {
                     ip += unum;
                 }
                 break;
+                */
 
             case MP_BC_SETUP_EXCEPT:
                 DECODE_ULABEL; // except labels are always forward
-                *++exc_sp = (machine_uint_t)ip + unum;
-                *++exc_sp = (machine_uint_t)sp;
+                printf("SETUP_EXCEPT %lu", ip + unum - ip_start);
                 break;
 
             case MP_BC_END_FINALLY:
-                // not implemented
                 // if TOS is an exception, reraises the exception (3 values on TOS)
                 // if TOS is an integer, does something else
                 // if TOS is None, just pops it and continues
                 // else error
-                assert(0);
+                printf("END_FINALLY");
                 break;
-                */
 
             case MP_BC_GET_ITER:
                 printf("GET_ITER");
@@ -221,22 +216,17 @@ void mp_show_byte_code(const byte *ip, int len) {
                 printf("FOR_ITER %lu", ip + unum - ip_start);
                 break;
 
-                /*
             case MP_BC_POP_BLOCK:
                 // pops block and restores the stack
-                assert(0);
+                printf("POP_BLOCK");
                 break;
 
             case MP_BC_POP_EXCEPT:
-                // TODO need to work out how blocks work etc
                 // pops block, checks it's an exception block, and restores the stack, saving the 3 exception values to local threadstate
-                assert(exc_sp >= &exc_stack[0]);
-                //sp = (mp_obj_t*)(*exc_sp--);
-                //exc_sp--; // discard ip
-                exc_sp -= 2;
-                //sp += 3; // pop 3 exception values
+                printf("POP_EXCEPT");
                 break;
 
+                /*
             case MP_BC_UNARY_OP:
                 unum = *ip++;
                 *sp = rt_unary_op(unum, *sp);
@@ -270,12 +260,14 @@ void mp_show_byte_code(const byte *ip, int len) {
                 rt_list_append(sp[unum], sp[0]);
                 sp++;
                 break;
+                */
 
             case MP_BC_BUILD_MAP:
                 DECODE_UINT;
-                PUSH(rt_build_map(unum));
+                printf("BUILD_MAP %lu", unum);
                 break;
 
+                /*
             case MP_BC_STORE_MAP:
                 sp += 2;
                 rt_store_map(sp[0], sp[-2], sp[-1]);
diff --git a/py/vm.c b/py/vm.c
index b10d641ca1..0a7c2fbf2c 100644
--- a/py/vm.c
+++ b/py/vm.c
@@ -61,8 +61,8 @@ bool mp_execute_byte_code_2(const byte **ip_in_out, mp_obj_t *fastn, mp_obj_t **
     mp_obj_t fast0 = fastn[0], fast1 = fastn[1], fast2 = fastn[2];
     nlr_buf_t nlr;
 
-    // on the exception stack we store (ip, sp) for each block
-    machine_uint_t exc_stack[8];
+    volatile machine_uint_t currently_in_except_block = 0; // 0 or 1, to detect nested exceptions
+    machine_uint_t exc_stack[8]; // on the exception stack we store (ip, sp | X) for each block, X = previous value of currently_in_except_block
     machine_uint_t *volatile exc_sp = &exc_stack[-1]; // stack grows up, exc_sp points to top of stack
 
     // outer exception handling loop
@@ -275,7 +275,8 @@ bool mp_execute_byte_code_2(const byte **ip_in_out, mp_obj_t *fastn, mp_obj_t **
                     case MP_BC_SETUP_EXCEPT:
                         DECODE_ULABEL; // except labels are always forward
                         *++exc_sp = (machine_uint_t)ip + unum;
-                        *++exc_sp = (machine_uint_t)sp;
+                        *++exc_sp = (((machine_uint_t)sp) | currently_in_except_block);
+                        currently_in_except_block = 0; // in a try block now
                         break;
 
                     case MP_BC_END_FINALLY:
@@ -313,7 +314,8 @@ bool mp_execute_byte_code_2(const byte **ip_in_out, mp_obj_t *fastn, mp_obj_t **
                         assert(exc_sp >= &exc_stack[0]);
                         //sp = (mp_obj_t*)(*exc_sp--);
                         //exc_sp--; // discard ip
-                        exc_sp -= 2;
+                        currently_in_except_block = (exc_sp[0] & 1); // restore previous state
+                        exc_sp -= 2; // pop back to previous exception handler
                         //sp += 3; // pop 3 exception values
                         break;
 
@@ -466,16 +468,33 @@ bool mp_execute_byte_code_2(const byte **ip_in_out, mp_obj_t *fastn, mp_obj_t **
         } else {
             // exception occurred
 
+            while (currently_in_except_block) {
+                // nested exception
+
+                assert(exc_sp >= &exc_stack[0]);
+
+                // TODO make a proper message for nested exception
+                // at the moment we are just raising the very last exception (the one that caused the nested exception)
+
+                // move up to previous exception handler
+                currently_in_except_block = (exc_sp[0] & 1); // restore previous state
+                exc_sp -= 2; // pop back to previous exception handler
+            }
+
             if (exc_sp >= &exc_stack[0]) {
+                // set flag to indicate that we are now handling an exception
+                currently_in_except_block = 1;
+
                 // catch exception and pass to byte code
-                sp = (mp_obj_t*)(exc_sp[0]);
+                sp = (mp_obj_t*)(exc_sp[0] & (~((machine_uint_t)1)));
                 ip = (const byte*)(exc_sp[-1]);
                 // push(traceback, exc-val, exc-type)
                 PUSH(mp_const_none);
                 PUSH(nlr.ret_val);
                 PUSH(mp_const_none);
+
             } else {
-                // re-raise exception
+                // re-raise exception to higher level
                 // TODO what to do if this is a generator??
                 nlr_jump(nlr.ret_val);
             }