diff --git a/src/cmd/ksh93/include/shlex.h b/src/cmd/ksh93/include/shlex.h
index 8a2bee3aa461..afbebc7aff21 100644
--- a/src/cmd/ksh93/include/shlex.h
+++ b/src/cmd/ksh93/include/shlex.h
@@ -55,6 +55,7 @@ struct _shlex_pvt_lexdata_
 	char		warn;
 	char		message;
 	char		arith;
+	char		funcalias; /* bug-666: Phi: */
 	char 		*first;
 	int		level;
 	int		lastc;
diff --git a/src/cmd/ksh93/sh/lex.c b/src/cmd/ksh93/sh/lex.c
index 0dd8432be1a0..2add362fcd2b 100644
--- a/src/cmd/ksh93/sh/lex.c
+++ b/src/cmd/ksh93/sh/lex.c
@@ -1458,6 +1458,14 @@ int sh_lex(Lex_t* lp)
 		}
 	}
 	c = 0;
+	/*
+	 * bug-666: Phi:
+	 * 
+	 */
+	if(lp->lexd.funcalias==1)
+	{ goto check_alias;
+	}
+
 	if(!lp->lex.skipword)
 	{
 		if(n>1 && lp->lex.reservok==1 && mode==ST_NAME &&
@@ -1496,6 +1504,8 @@ int sh_lex(Lex_t* lp)
 		{
 			/* check for aliases */
 			Namval_t* np;
+
+		check_alias: /* bug-666: Phi: */
 			if(!lp->lex.incase && !assignment && fcpeek(0)!=LPAREN &&
 				(np=nv_search(state,sh.alias_tree,0))
 				&& !nv_isattr(np,NV_NOEXPAND)
@@ -1503,11 +1513,35 @@ int sh_lex(Lex_t* lp)
 				&& (!sh_isstate(SH_NOALIAS) || nv_isattr(np,NV_NOFREE))
 				&& (state=nv_getval(np)))
 			{
+				int t; /* bug-666: Phi: */
 				setupalias(lp,state,np);
 				nv_onattr(np,NV_NOEXPAND);
 				lp->lex.reservok = 1;
 				lp->assignok |= lp->lex.reservok;
-				return sh_lex(lp);
+				/*
+				 * bug-666: Phi: Check if we just expanded
+				 * "function " (i.e trailig space), if so we
+				 * got to set lp->lexd.funcalias=1;
+				 * so that next funct() will have a chance to
+				 * expand next word. The original return
+				 * below is replaced with the funcalias
+				 * setup
+				 */
+				/* return sh_lex(lp);  */
+				if(lp->lexd.funcalias==1)
+				{
+					lp->lexd.funcalias++;
+				}
+				t=sh_lex(lp);
+				if(strcmp(state,"function ")==0)
+				{
+					lp->lexd.funcalias=1;
+				}
+				else
+				{
+					lp->lexd.funcalias=0;
+				}
+				return t;
 			}
 		}
 		lp->lex.reservok = 0;
diff --git a/src/cmd/ksh93/tests/alias.sh b/src/cmd/ksh93/tests/alias.sh
index a349485fd449..1b27f65a0da5 100755
--- a/src/cmd/ksh93/tests/alias.sh
+++ b/src/cmd/ksh93/tests/alias.sh
@@ -319,5 +319,11 @@ chmod +x bad_func  # bug only triggered if file is executable
 (FPATH=$PWD; alias -t bad_func 2>/dev/null; typeset -f bad_func >/dev/null)
 (($? > 0)) || err_exit "'hash'/'alias -t' autoloads function"
 
+# bug-666: Phi:
+alias 'x=function ' y=f z='{ ' t='echo ' u='AA '  v='}'
+x y z t u v
+got=$(f)
+[ "$got" = 'AA' ] || err_exit "alias x='function ' not working"
+
 # ======
 exit $((Errors<125?Errors:125))