diff --git a/CONTRIBUTORS.txt b/CONTRIBUTORS.txt
index a107e3387b1..3f33d8253f2 100644
--- a/CONTRIBUTORS.txt
+++ b/CONTRIBUTORS.txt
@@ -118,6 +118,7 @@ Sebastian Hüther
 SeongSoo Cho
 Sergey Ninua
 Sergey Skripnick
+Serhii Kostel
 Simon Kennedy
 Sin-Woo Bang
 Stanislas Plum
diff --git a/tests/test_proxy_functional.py b/tests/test_proxy_functional.py
new file mode 100644
index 00000000000..72116361601
--- /dev/null
+++ b/tests/test_proxy_functional.py
@@ -0,0 +1,279 @@
+import asyncio
+from functools import partial
+from unittest import mock
+
+import pytest
+from yarl import URL
+
+import aiohttp
+import aiohttp.helpers
+import aiohttp.web
+
+
+@asyncio.coroutine
+def test_proxy_http_absolute_path(proxy_test_server, get_request):
+    url = 'http://aiohttp.io/path?query=yes'
+    proxy = yield from proxy_test_server()
+
+    yield from get_request(url=url, proxy=proxy.url)
+
+    assert len(proxy.requests_list) == 1
+    assert proxy.request.method == 'GET'
+    assert proxy.request.host == 'aiohttp.io'
+    assert proxy.request.path_qs == 'http://aiohttp.io/path?query=yes'
+
+
+@asyncio.coroutine
+def test_proxy_http_raw_path(proxy_test_server, get_request):
+    url = 'http://aiohttp.io:2561/space sheep?q=can:fly'
+    raw_url = 'http://aiohttp.io:2561/space%20sheep?q=can%3Afly'
+    proxy = yield from proxy_test_server()
+
+    yield from get_request(url=url, proxy=proxy.url)
+
+    assert proxy.request.host == 'aiohttp.io:2561'
+    assert proxy.request.path_qs == raw_url
+
+
+@asyncio.coroutine
+def test_proxy_http_connection_error(get_request):
+    url = 'http://aiohttp.io/path'
+    proxy_url = 'http://localhost:2242/'
+
+    with pytest.raises(aiohttp.ProxyConnectionError):
+        yield from get_request(url=url, proxy=proxy_url)
+
+
+@asyncio.coroutine
+def test_proxy_http_bad_response(proxy_test_server, get_request):
+    url = 'http://aiohttp.io/path'
+    proxy = yield from proxy_test_server()
+    proxy.return_value = dict(
+        status=502,
+        headers={'Proxy-Agent': 'TestProxy'})
+
+    resp = yield from get_request(url=url, proxy=proxy.url)
+
+    assert resp.status == 502
+    assert resp.headers['Proxy-Agent'] == 'TestProxy'
+
+
+@asyncio.coroutine
+def test_proxy_http_auth(proxy_test_server, get_request):
+    url = 'http://aiohttp.io/path'
+    proxy = yield from proxy_test_server()
+
+    yield from get_request(url=url, proxy=proxy.url)
+
+    assert 'Authorization' not in proxy.request.headers
+    assert 'Proxy-Authorization' not in proxy.request.headers
+
+    auth = aiohttp.helpers.BasicAuth('user', 'pass')
+    yield from get_request(url=url, auth=auth, proxy=proxy.url)
+
+    assert 'Authorization' in proxy.request.headers
+    assert 'Proxy-Authorization' not in proxy.request.headers
+
+    yield from get_request(url=url, proxy_auth=auth, proxy=proxy.url)
+
+    assert 'Authorization' not in proxy.request.headers
+    assert 'Proxy-Authorization' in proxy.request.headers
+
+    yield from get_request(url=url, auth=auth,
+                           proxy_auth=auth, proxy=proxy.url)
+
+    assert 'Authorization' in proxy.request.headers
+    assert 'Proxy-Authorization' in proxy.request.headers
+
+
+@asyncio.coroutine
+def test_proxy_http_auth_utf8(proxy_test_server, get_request):
+    url = 'http://aiohttp.io/path'
+    auth = aiohttp.helpers.BasicAuth('юзер', 'пасс', 'utf-8')
+    proxy = yield from proxy_test_server()
+
+    yield from get_request(url=url, auth=auth, proxy=proxy.url)
+
+    assert 'Authorization' in proxy.request.headers
+    assert 'Proxy-Authorization' not in proxy.request.headers
+
+
+@asyncio.coroutine
+def test_proxy_http_auth_from_url(proxy_test_server, get_request):
+    url = 'http://aiohttp.io/path'
+    proxy = yield from proxy_test_server()
+
+    auth_url = URL(url).with_user('user').with_password('pass')
+    yield from get_request(url=auth_url, proxy=proxy.url)
+
+    assert 'Authorization' in proxy.request.headers
+    assert 'Proxy-Authorization' not in proxy.request.headers
+
+    proxy_url = URL(proxy.url).with_user('user').with_password('pass')
+    yield from get_request(url=url, proxy=proxy_url)
+
+    assert 'Authorization' not in proxy.request.headers
+    assert 'Proxy-Authorization' in proxy.request.headers
+
+
+@asyncio.coroutine
+def test_proxy_https_connect(proxy_test_server, get_request):
+    proxy = yield from proxy_test_server()
+    url = 'https://www.google.com.ua/search?q=aiohttp proxy'
+
+    yield from get_request(url=url, proxy=proxy.url)
+
+    connect = proxy.requests_list[0]
+    assert connect.method == 'CONNECT'
+    assert connect.path == 'www.google.com.ua:443'
+    assert connect.host == 'www.google.com.ua'
+
+    assert proxy.request.host == 'www.google.com.ua'
+    assert proxy.request.path_qs == '/search?q=aiohttp+proxy'
+
+
+@asyncio.coroutine
+def test_proxy_https_connect_with_port(proxy_test_server, get_request):
+    proxy = yield from proxy_test_server()
+    url = 'https://secure.aiohttp.io:2242/path'
+
+    yield from get_request(url=url, proxy=proxy.url)
+
+    connect = proxy.requests_list[0]
+    assert connect.method == 'CONNECT'
+    assert connect.path == 'secure.aiohttp.io:2242'
+    assert connect.host == 'secure.aiohttp.io:2242'
+
+    assert proxy.request.host == 'secure.aiohttp.io:2242'
+    assert proxy.request.path_qs == '/path'
+
+
+@asyncio.coroutine
+def test_proxy_https_connection_error(get_request):
+    url = 'https://secure.aiohttp.io/path'
+    proxy_url = 'http://localhost:2242/'
+
+    with pytest.raises(aiohttp.ProxyConnectionError):
+        yield from get_request(url=url, proxy=proxy_url)
+
+
+@asyncio.coroutine
+def test_proxy_https_bad_response(proxy_test_server, get_request):
+    url = 'https://secure.aiohttp.io/path'
+    proxy = yield from proxy_test_server()
+    proxy.return_value = dict(
+        status=502,
+        headers={'Proxy-Agent': 'TestProxy'})
+
+    with pytest.raises(aiohttp.HttpProxyError):
+        yield from get_request(url=url, proxy=proxy.url)
+
+    assert len(proxy.requests_list) == 1
+    assert proxy.request.method == 'CONNECT'
+    assert proxy.request.path == 'secure.aiohttp.io:443'
+
+
+@asyncio.coroutine
+def test_proxy_https_auth(proxy_test_server, get_request):
+    url = 'https://secure.aiohttp.io/path'
+    auth = aiohttp.helpers.BasicAuth('user', 'pass')
+
+    proxy = yield from proxy_test_server()
+    yield from get_request(url=url, proxy=proxy.url)
+
+    connect = proxy.requests_list[0]
+    assert 'Authorization' not in connect.headers
+    assert 'Proxy-Authorization' not in connect.headers
+    assert 'Authorization' not in proxy.request.headers
+    assert 'Proxy-Authorization' not in proxy.request.headers
+
+    proxy = yield from proxy_test_server()
+    yield from get_request(url=url, auth=auth, proxy=proxy.url)
+
+    connect = proxy.requests_list[0]
+    assert 'Authorization' not in connect.headers
+    assert 'Proxy-Authorization' not in connect.headers
+    assert 'Authorization' in proxy.request.headers
+    assert 'Proxy-Authorization' not in proxy.request.headers
+
+    proxy = yield from proxy_test_server()
+    yield from get_request(url=url, proxy_auth=auth, proxy=proxy.url)
+
+    connect = proxy.requests_list[0]
+    assert 'Authorization' not in connect.headers
+    assert 'Proxy-Authorization' in connect.headers
+    assert 'Authorization' not in proxy.request.headers
+    assert 'Proxy-Authorization' not in proxy.request.headers
+
+    proxy = yield from proxy_test_server()
+    yield from get_request(url=url, auth=auth,
+                           proxy_auth=auth, proxy=proxy.url)
+
+    connect = proxy.requests_list[0]
+    assert 'Authorization' not in connect.headers
+    assert 'Proxy-Authorization' in connect.headers
+    assert 'Authorization' in proxy.request.headers
+    assert 'Proxy-Authorization' not in proxy.request.headers
+
+
+def _patch_ssl_transport(monkeypatch):
+    """Make ssl transport substitution to prevent ssl handshake."""
+    def _make_ssl_transport_dummy(self, rawsock, protocol, sslcontext,
+                                  waiter=None, **kwargs):
+        return self._make_socket_transport(rawsock, protocol, waiter)
+
+    monkeypatch.setattr(
+        "asyncio.selector_events.BaseSelectorEventLoop._make_ssl_transport",
+        _make_ssl_transport_dummy)
+
+
+@pytest.fixture
+def proxy_test_server(raw_test_server, loop, monkeypatch):
+    """Handle all proxy requests and imitate remote server response."""
+
+    _patch_ssl_transport(monkeypatch)
+
+    default_response = dict(
+        status=200,
+        headers=None,
+        body=None)
+
+    @asyncio.coroutine
+    def proxy_handler(request, proxy_mock):
+        proxy_mock.request = request
+        proxy_mock.requests_list.append(request)
+
+        response = default_response.copy()
+        if isinstance(proxy_mock.return_value, dict):
+            response.update(proxy_mock.return_value)
+
+        return aiohttp.web.Response(**response)
+
+    @asyncio.coroutine
+    def proxy_server():
+        proxy_mock = mock.Mock()
+        proxy_mock.request = None
+        proxy_mock.requests_list = []
+
+        handler = partial(proxy_handler, proxy_mock=proxy_mock)
+        server = yield from raw_test_server(handler, loop=loop)
+
+        proxy_mock.server = server
+        proxy_mock.url = server.make_url('/')
+
+        return proxy_mock
+
+    return proxy_server
+
+
+@asyncio.coroutine
+def _request(method, url, loop=None, **kwargs):
+    with aiohttp.ClientSession(loop=loop) as client:
+        resp = yield from client.request(method, url, **kwargs)
+        yield from resp.release()
+        return resp
+
+
+@pytest.fixture()
+def get_request(loop):
+    return partial(_request, method='GET', loop=loop)