diff --git a/new/property.jam b/new/property.jam
index 05897b440..602218888 100644
--- a/new/property.jam
+++ b/new/property.jam
@@ -114,7 +114,7 @@ rule evaluate-conditionals-in-context ( properties * : context * )
     for local p in $(conditionals)
     {
         # Separate condition and property
-        local s = [ MATCH (.*):(.*) : $(p) ] ;
+        local s = [ MATCH ([^:]*):(.*) : $(p) ] ;
         # Split condition into individual properties
         local c = [ regex.split $(s[1]) "," ] ;
         # Evaluate condition
diff --git a/test/conditionals3.py b/test/conditionals3.py
new file mode 100644
index 000000000..c4b067dd0
--- /dev/null
+++ b/test/conditionals3.py
@@ -0,0 +1,34 @@
+#!/usr/bin/python
+
+#  Copyright (C) Vladimir Prus 2003. Permission to copy, use, modify, sell and
+#  distribute this software is granted provided this copyright notice appears in
+#  all copies. This software is provided "as is" without express or implied
+#  warranty, and with no claim as to its suitability for any purpose.
+
+#  Test that conditional properties work, even if property is free, and
+#  value includes colon.
+from BoostBuild import Tester, List
+
+
+t = Tester()
+
+# Create the needed files
+t.write("project-root.jam", "")
+t.write("Jamfile", """
+exe hello : hello.cpp : <variant>debug:<define>CLASS=Foo::Bar ;
+""")
+t.write("hello.cpp", """
+namespace Foo { class Bar { } ; }
+int main()
+{
+    CLASS c;
+    return 0;
+}
+
+""")
+
+# Don't check stderr, which can include warning about unused 'c'.
+t.run_build_system(stderr=None)
+t.expect_addition("bin/$toolset/debug/main-target-hello/hello")
+
+t.cleanup()
diff --git a/test/test_all.py b/test/test_all.py
index 71aab124b..c30dfc97b 100644
--- a/test/test_all.py
+++ b/test/test_all.py
@@ -101,6 +101,7 @@ tests = [ "project_test1",
           "conditionals2",
           "property_expansion",
           "loop",
+          "conditionals3",
 	  ]
 
 if os.name == 'posix':
diff --git a/v2/build/property.jam b/v2/build/property.jam
index 05897b440..602218888 100644
--- a/v2/build/property.jam
+++ b/v2/build/property.jam
@@ -114,7 +114,7 @@ rule evaluate-conditionals-in-context ( properties * : context * )
     for local p in $(conditionals)
     {
         # Separate condition and property
-        local s = [ MATCH (.*):(.*) : $(p) ] ;
+        local s = [ MATCH ([^:]*):(.*) : $(p) ] ;
         # Split condition into individual properties
         local c = [ regex.split $(s[1]) "," ] ;
         # Evaluate condition
diff --git a/v2/test/conditionals3.py b/v2/test/conditionals3.py
new file mode 100644
index 000000000..c4b067dd0
--- /dev/null
+++ b/v2/test/conditionals3.py
@@ -0,0 +1,34 @@
+#!/usr/bin/python
+
+#  Copyright (C) Vladimir Prus 2003. Permission to copy, use, modify, sell and
+#  distribute this software is granted provided this copyright notice appears in
+#  all copies. This software is provided "as is" without express or implied
+#  warranty, and with no claim as to its suitability for any purpose.
+
+#  Test that conditional properties work, even if property is free, and
+#  value includes colon.
+from BoostBuild import Tester, List
+
+
+t = Tester()
+
+# Create the needed files
+t.write("project-root.jam", "")
+t.write("Jamfile", """
+exe hello : hello.cpp : <variant>debug:<define>CLASS=Foo::Bar ;
+""")
+t.write("hello.cpp", """
+namespace Foo { class Bar { } ; }
+int main()
+{
+    CLASS c;
+    return 0;
+}
+
+""")
+
+# Don't check stderr, which can include warning about unused 'c'.
+t.run_build_system(stderr=None)
+t.expect_addition("bin/$toolset/debug/main-target-hello/hello")
+
+t.cleanup()
diff --git a/v2/test/test_all.py b/v2/test/test_all.py
index 71aab124b..c30dfc97b 100644
--- a/v2/test/test_all.py
+++ b/v2/test/test_all.py
@@ -101,6 +101,7 @@ tests = [ "project_test1",
           "conditionals2",
           "property_expansion",
           "loop",
+          "conditionals3",
 	  ]
 
 if os.name == 'posix':