diff --git a/Lib/test/test_urllib2_localnet.py b/Lib/test/test_urllib2_localnet.py
index 2e87f11..e1610c3 100644
--- a/Lib/test/test_urllib2_localnet.py
+++ b/Lib/test/test_urllib2_localnet.py
@@ -1,6 +1,8 @@
+import base64
 import urlparse
 import urllib2
 import BaseHTTPServer
+import SimpleHTTPServer
 import unittest
 import hashlib
 
@@ -66,6 +68,48 @@
 
 # Authentication infrastructure
 
+
+class BasicAuthHandler(SimpleHTTPServer.SimpleHTTPRequestHandler):
+    """Handler for performing Basic Authentication."""
+    # Server side values
+    USER = "testUser"
+    PASSWD = "testPass"
+    REALM = "Test"
+    USER_PASSWD = "%s:%s" % (USER, PASSWD)
+    ENCODED_AUTH = base64.b64encode(USER_PASSWD)
+
+    def __init__(self, *args, **kwargs):
+        SimpleHTTPServer.SimpleHTTPRequestHandler.__init__(self, *args,
+                                                           **kwargs)
+
+    def log_message(self, format, *args):
+        # Supress the HTTP Console log output
+        pass
+
+    def do_HEAD(self):
+        self.send_response(200)
+        self.send_header("Content-type", "text/html")
+        self.end_headers()
+
+    def do_AUTHHEAD(self):
+        self.send_response(401)
+        self.send_header("WWW-Authenticate", "Basic realm=\"%s\"" % self.REALM)
+        self.send_header("Content-type", "text/html")
+        self.end_headers()
+
+    def do_GET(self):
+        if self.headers.getheader("Authorization") == None:
+            self.do_AUTHHEAD()
+            self.wfile.write("No Auth Header Received")
+        elif self.headers.getheader(
+                "Authorization") == "Basic " + self.ENCODED_AUTH:
+            SimpleHTTPServer.SimpleHTTPRequestHandler.do_GET(self)
+        else:
+            self.do_AUTHHEAD()
+            self.wfile.write(self.headers.getheader("Authorization"))
+            self.wfile.write("Not Authenticated")
+
+
 class DigestAuthHandler:
     """Handler for performing digest authentication."""
 
@@ -228,6 +272,45 @@
         test_support.threading_cleanup(*self._threads)
 
 
+class BasicAuthTests(BaseTestCase):
+    USER = "testUser"
+    PASSWD = "testPass"
+    INCORRECT_PASSWD = "Incorrect"
+    REALM = "Test"
+
+    def setUp(self):
+        super(BasicAuthTests, self).setUp()
+        # With Basic Authentication
+        def http_server_with_basic_auth_handler(*args, **kwargs):
+            return BasicAuthHandler(*args, **kwargs)
+        self.server = LoopbackHttpServerThread(http_server_with_basic_auth_handler)
+        self.server_url = 'http://127.0.0.1:%s' % self.server.port
+        self.server.start()
+        self.server.ready.wait()
+
+    def tearDown(self):
+        self.server.stop()
+        super(BasicAuthTests, self).tearDown()
+
+    def test_basic_auth_success(self):
+        ah = urllib2.HTTPBasicAuthHandler()
+        ah.add_password(self.REALM, self.server_url, self.USER, self.PASSWD)
+        urllib2.install_opener(urllib2.build_opener(ah))
+        try:
+            self.assertTrue(urllib2.urlopen(self.server_url))
+        except urllib2.HTTPError:
+            self.fail("Basic Auth Failed for url: %s" % self.server_url)
+        except Exception as e:
+            raise e
+
+    def test_basic_auth_httperror(self):
+        ah = urllib2.HTTPBasicAuthHandler()
+        ah.add_password(self.REALM, self.server_url, self.USER,
+                        self.INCORRECT_PASSWD)
+        urllib2.install_opener(urllib2.build_opener(ah))
+        self.assertRaises(urllib2.HTTPError, urllib2.urlopen, self.server_url)
+
+
 class ProxyAuthTests(BaseTestCase):
     URL = "http://localhost"
 
@@ -240,6 +323,7 @@
         self.digest_auth_handler = DigestAuthHandler()
         self.digest_auth_handler.set_users({self.USER: self.PASSWD})
         self.digest_auth_handler.set_realm(self.REALM)
+        # With Digest Authentication
         def create_fake_proxy_handler(*args, **kwargs):
             return FakeProxyHandler(self.digest_auth_handler, *args, **kwargs)
 
@@ -544,7 +628,7 @@
     # the next line.
     #test_support.requires("network")
 
-    test_support.run_unittest(ProxyAuthTests, TestUrlopen)
+    test_support.run_unittest(BasicAuthTests, ProxyAuthTests, TestUrlopen)
 
 if __name__ == "__main__":
     test_main()
diff --git a/Lib/urllib2.py b/Lib/urllib2.py
index aadeb73..10051ff 100644
--- a/Lib/urllib2.py
+++ b/Lib/urllib2.py
@@ -843,10 +843,7 @@
             password_mgr = HTTPPasswordMgr()
         self.passwd = password_mgr
         self.add_password = self.passwd.add_password
-        self.retried = 0
 
-    def reset_retry_count(self):
-        self.retried = 0
 
     def http_error_auth_reqed(self, authreq, host, req, headers):
         # host may be an authority (without userinfo) or a URL with an
@@ -854,13 +851,6 @@
         # XXX could be multiple headers
         authreq = headers.get(authreq, None)
 
-        if self.retried > 5:
-            # retry sending the username:password 5 times before failing.
-            raise HTTPError(req.get_full_url(), 401, "basic auth failed",
-                            headers, None)
-        else:
-            self.retried += 1
-
         if authreq:
             mo = AbstractBasicAuthHandler.rx.search(authreq)
             if mo:
@@ -869,17 +859,14 @@
                     warnings.warn("Basic Auth Realm was unquoted",
                                   UserWarning, 2)
                 if scheme.lower() == 'basic':
-                    response = self.retry_http_basic_auth(host, req, realm)
-                    if response and response.code != 401:
-                        self.retried = 0
-                    return response
+                    return self.retry_http_basic_auth(host, req, realm)
 
     def retry_http_basic_auth(self, host, req, realm):
         user, pw = self.passwd.find_user_password(realm, host)
         if pw is not None:
             raw = "%s:%s" % (user, pw)
             auth = 'Basic %s' % base64.b64encode(raw).strip()
-            if req.headers.get(self.auth_header, None) == auth:
+            if req.get_header(self.auth_header, None) == auth:
                 return None
             req.add_unredirected_header(self.auth_header, auth)
             return self.parent.open(req, timeout=req.timeout)
@@ -895,7 +882,6 @@
         url = req.get_full_url()
         response = self.http_error_auth_reqed('www-authenticate',
                                               url, req, headers)
-        self.reset_retry_count()
         return response
 
 
@@ -911,7 +897,6 @@
         authority = req.get_host()
         response = self.http_error_auth_reqed('proxy-authenticate',
                                           authority, req, headers)
-        self.reset_retry_count()
         return response
 
 
diff --git a/Misc/NEWS b/Misc/NEWS
index 86deb58..dd80f6c 100644
--- a/Misc/NEWS
+++ b/Misc/NEWS
@@ -19,6 +19,9 @@
 Library
 -------
 
+- Issue #8797: Raise HTTPError on failed Basic Authentication immediately.
+  Initial patch by Sam Bull.
+
 - Issue #21448: Changed FeedParser feed() to avoid O(N**2) behavior when
   parsing long line.  Original patch by Raymond Hettinger.