diff --git a/CHANGELOG.md b/CHANGELOG.md
index e7934dc77..3a471108c 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -4,6 +4,7 @@
 
 - Re-enable default token list.
 - Add origin header to dapp-bound requests to allow providers to throttle sites.
+- Fix bug that could sometimes resubmit a transaction that had been stalled due to low balance after balance was restored.
 
 ## 3.8.2 2017-7-3
 
diff --git a/app/scripts/controllers/transactions.js b/app/scripts/controllers/transactions.js
index 52251d66e..7946d10d1 100644
--- a/app/scripts/controllers/transactions.js
+++ b/app/scripts/controllers/transactions.js
@@ -428,10 +428,22 @@ module.exports = class TransactionController extends EventEmitter {
     const gtBalance = Number.parseInt(txMeta.txParams.value) > Number.parseInt(balance)
     if (!('retryCount' in txMeta)) txMeta.retryCount = 0
 
-    // if the value of the transaction is greater then the balance
-    // or the nonce of the transaction is lower then the accounts nonce
-    // dont resubmit the tx
-    if (gtBalance || txNonce < nonce) return cb()
+    // if the value of the transaction is greater then the balance, fail.
+    if (gtBalance) {
+      const message = 'Insufficient balance.'
+      this.setTxStatusFailed(txMeta.id, message)
+      cb()
+      return log.error(message)
+    }
+
+    // if the nonce of the transaction is lower then the accounts nonce, fail.
+    if (txNonce < nonce) {
+      const message = 'Invalid nonce.'
+      this.setTxStatusFailed(txMeta.id, message)
+      cb()
+      return log.error(message)
+    }
+
     // Only auto-submit already-signed txs:
     if (!('rawTx' in txMeta)) return cb()
 
diff --git a/test/unit/tx-controller-test.js b/test/unit/tx-controller-test.js
index 0d35cd62c..01a498820 100644
--- a/test/unit/tx-controller-test.js
+++ b/test/unit/tx-controller-test.js
@@ -19,6 +19,7 @@ describe('Transaction Controller', function () {
     txController = new TransactionController({
       networkStore: new ObservableStore(currentNetworkId),
       txHistoryLimit: 10,
+      ethStore: { getState: noop },
       provider: { _blockTracker: new EventEmitter()},
       blockTracker: new EventEmitter(),
       ethQuery: new EthQuery(new EventEmitter()),
@@ -322,4 +323,43 @@ describe('Transaction Controller', function () {
       })
     })
   })
+
+  describe('#_resubmitTx with a too-low balance', function () {
+    it('should fail the transaction', function (done) {
+      const from = '0xda0da0'
+      const txMeta = {
+        id: 1,
+        status: 'submitted',
+        metamaskNetworkId: currentNetworkId,
+        txParams: {
+          from,
+          nonce: '0x1',
+          value: '0xfffff',
+        },
+      }
+
+      const lowBalance = '0x0'
+      const fakeStoreState = { accounts: {} }
+      fakeStoreState.accounts[from] = {
+        balance: lowBalance,
+        nonce: '0x0',
+      }
+
+      // Stubbing out current account state:
+      const getStateStub = sinon.stub(txController.ethStore, 'getState')
+      .returns(fakeStoreState)
+
+      // Adding the fake tx:
+      txController.addTx(clone(txMeta))
+
+      txController._resubmitTx(txMeta, function (err) {
+        assert.ifError(err, 'should not throw an error')
+        const updatedMeta = txController.getTx(txMeta.id)
+        assert.notEqual(updatedMeta.status, txMeta.status, 'status changed.')
+        assert.equal(updatedMeta.status, 'failed', 'tx set to failed.')
+        done()
+      })
+    })
+  })
 })
+