diff --git a/nvm.sh b/nvm.sh
index 899b6da..cc8beee 100644
--- a/nvm.sh
+++ b/nvm.sh
@@ -278,8 +278,35 @@ nvm_resolve_alias() {
   local PATTERN
   PATTERN="$1"
 
-  if [ -f "$NVM_DIR/alias/$PATTERN" ]; then
-    nvm_version "$(nvm_alias "$PATTERN" 2> /dev/null)"
+  local ALIAS
+  ALIAS="$PATTERN"
+  local ALIAS_TEMP
+
+  local SEEN_ALIASES
+  SEEN_ALIASES="$ALIAS"
+  while true; do
+    ALIAS_TEMP="$(nvm_alias "$ALIAS" 2> /dev/null)"
+
+    if [ -z "$ALIAS_TEMP" ]; then
+      break
+    fi
+
+    if [ -n "$ALIAS_TEMP" ] \
+      && printf "$SEEN_ALIASES" | \grep -e "^$ALIAS_TEMP$" > /dev/null; then
+      ALIAS="∞"
+      break
+    fi
+
+    SEEN_ALIASES="$SEEN_ALIASES\n$ALIAS_TEMP"
+    ALIAS="$ALIAS_TEMP"
+  done
+
+  if [ -n "$ALIAS" ] && [ "_$ALIAS" != "_$PATTERN" ]; then
+    if [ "_$ALIAS" = "_∞" ]; then
+      echo "$ALIAS"
+    else
+      nvm_version "$ALIAS"
+    fi
     return 0
   fi
 
diff --git a/test/fast/Aliases/circular/nvm_resolve_alias b/test/fast/Aliases/circular/nvm_resolve_alias
new file mode 100755
index 0000000..4b5dab9
--- /dev/null
+++ b/test/fast/Aliases/circular/nvm_resolve_alias
@@ -0,0 +1,36 @@
+#!/bin/sh
+
+die () { echo $@ ; exit 1; }
+
+. ../../../../nvm.sh
+
+ALIAS="$(nvm_resolve_alias loopback)"
+[ "_$ALIAS" = "_∞" ] || die "nvm_resolve_alias loopback was not ∞; got $ALIAS"
+OUTPUT="$(nvm alias loopback)"
+EXPECTED_OUTPUT="loopback -> loopback (-> ∞)"
+[ "_$OUTPUT" = "_$EXPECTED_OUTPUT" ] || die "nvm alias loopback was not $EXPECTED_OUTPUT; got $OUTPUT"
+
+ALIAS="$(nvm_resolve_alias one)"
+[ "_$ALIAS" = "_∞" ] || die "nvm_resolve_alias one was not ∞; got $ALIAS"
+OUTPUT="$(nvm alias one)"
+EXPECTED_OUTPUT="one -> two (-> ∞)"
+[ "_$OUTPUT" = "_$EXPECTED_OUTPUT" ] || die "nvm alias one was not $EXPECTED_OUTPUT; got $OUTPUT"
+
+ALIAS="$(nvm_resolve_alias two)"
+[ "_$ALIAS" = "_∞" ] || die "nvm_resolve_alias two was not ∞; got $ALIAS"
+OUTPUT="$(nvm alias two)"
+EXPECTED_OUTPUT="two -> three (-> ∞)"
+[ "_$OUTPUT" = "_$EXPECTED_OUTPUT" ] || die "nvm alias two was not $EXPECTED_OUTPUT; got $OUTPUT"
+
+ALIAS="$(nvm_resolve_alias three)"
+[ "_$ALIAS" = "_∞" ] || die "nvm_resolve_alias three was not ∞; got $ALIAS"
+OUTPUT="$(nvm alias three)"
+EXPECTED_OUTPUT="three -> one (-> ∞)"
+[ "_$OUTPUT" = "_$EXPECTED_OUTPUT" ] || die "nvm alias three was not $EXPECTED_OUTPUT; got $OUTPUT"
+
+ALIAS="$(nvm_resolve_alias four)"
+[ "_$ALIAS" = "_∞" ] || die "nvm_resolve_alias four was not ∞; got $ALIAS"
+OUTPUT="$(nvm alias four)"
+EXPECTED_OUTPUT="four -> two (-> ∞)"
+[ "_$OUTPUT" = "_$EXPECTED_OUTPUT" ] || die "nvm alias four was not $EXPECTED_OUTPUT; got $OUTPUT"
+
diff --git a/test/fast/Aliases/circular/setup b/test/fast/Aliases/circular/setup
new file mode 100755
index 0000000..8f2b142
--- /dev/null
+++ b/test/fast/Aliases/circular/setup
@@ -0,0 +1,10 @@
+#!/bin/sh
+
+echo loopback > ../../../../alias/loopback
+
+echo two > ../../../../alias/one
+echo three > ../../../../alias/two
+echo one > ../../../../alias/three
+
+echo two > ../../../../alias/four
+
diff --git a/test/fast/Aliases/circular/teardown b/test/fast/Aliases/circular/teardown
new file mode 100755
index 0000000..9b6c79c
--- /dev/null
+++ b/test/fast/Aliases/circular/teardown
@@ -0,0 +1,10 @@
+#!/bin/sh
+
+rm -f ../../../../alias/loopback
+
+rm -f ../../../../alias/one
+rm -f ../../../../alias/two
+rm -f ../../../../alias/three
+
+rm -f ../../../../alias/four
+
diff --git a/test/fast/Aliases/setup_dir b/test/fast/Aliases/setup
similarity index 100%
rename from test/fast/Aliases/setup_dir
rename to test/fast/Aliases/setup
diff --git a/test/fast/Aliases/teardown_dir b/test/fast/Aliases/teardown
similarity index 100%
rename from test/fast/Aliases/teardown_dir
rename to test/fast/Aliases/teardown