diff --git a/src/lj_snap.c b/src/lj_snap.c
index 8a33dc223f..8d7bd868e3 100644
--- a/src/lj_snap.c
+++ b/src/lj_snap.c
@@ -252,7 +252,12 @@ static BCReg snap_usedef(jit_State *J, uint8_t *udf,
       BCReg minslot = bc_a(ins);
       if (op >= BC_FORI && op <= BC_JFORL) minslot += FORL_EXT;
       else if (op >= BC_ITERL && op <= BC_JITERL) minslot += bc_b(pc[-2])-1;
-      else if (op == BC_UCLO) { pc += bc_j(ins); break; }
+      else if (op == BC_UCLO) {
+	ptrdiff_t delta = bc_j(ins);
+	if (delta < 0) return maxslot;  /* Prevent loop. */
+	pc += delta;
+	break;
+      }
       for (s = minslot; s < maxslot; s++) DEF_SLOT(s);
       return minslot < maxslot ? minslot : maxslot;
       }
diff --git a/test/tarantool-tests/lj-736-BC_UCLO-triggers-infinite-loop.test.lua b/test/tarantool-tests/lj-736-BC_UCLO-triggers-infinite-loop.test.lua
new file mode 100644
index 0000000000..01dba4bb24
--- /dev/null
+++ b/test/tarantool-tests/lj-736-BC_UCLO-triggers-infinite-loop.test.lua
@@ -0,0 +1,66 @@
+local tap = require('tap')
+-- Test file to demonstrate the infinite loop in LuaJIT during the
+-- use-def analysis for upvalues.
+-- See details in https://github.com/LuaJIT/LuaJIT/issues/736.
+local test = tap.test('lj-736-BC_UCLO-triggers-infinite-loop'):skipcond({
+  ['Test requires JIT enabled'] = not jit.status(),
+})
+test:plan(2)
+
+-- Before the patch, the code flow like in the `testcase()` below
+-- may cause the problem -- use-def analysis for the 0019 UCLO
+-- creates an infinite loop in 0014 - 0019:
+-- | 0008 FORI   base:    4 jump:  => 0013
+-- | 0009 ISNEN  var:     7 num:     0 ; number 2
+-- | 0010 JMP    rbase:   8 jump:  => 0012
+-- | 0011 UCLO   rbase:   2 jump:  => 0014
+-- | 0012 FORL   base:    4 jump:  => 0009
+-- | 0013 UCLO   rbase:   2 jump:  => 0014
+-- | 0014 KPRI   dst:     2 pri:     0 ; Start of `assert()` line.
+-- | ...
+-- | 0019 UCLO   rbase:   2 jump:  => 0014
+
+jit.opt.start('hotloop=1')
+
+local assert_msg = 'Infinite loop is not reproduced.'
+local assert = assert
+
+local function testcase()
+  -- The code in the first scope `do`/`end` is a prerequisite.
+  -- It contains the UCLO instruction for the `uv1`. The use-def
+  -- analysis for it escapes this `do`/`end` scope.
+  do
+    local uv1 -- luacheck: no unused
+    local _ = function() return uv1 end
+
+    -- Records the trace for which use-def analysis is applied.
+    for i = 1, 2 do
+      -- This condition triggers snapshoting and use-def analysis.
+      -- Before the patch this triggers the infinite loop in the
+      -- `snap_usedef()`, so the `goto` is never taken.
+      if i == 2 then
+        goto x
+      end
+    end
+  end
+
+::x::
+  do
+    local uv2 -- luacheck: no unused
+
+    -- Create a tight loop for the one more upvalue (`uv2`).
+    -- Before the patch, use-def analysis gets stuck in this code
+    -- flow.
+    assert(nil, assert_msg)
+    goto x
+    -- This code is unreachable by design.
+    local _ = function() return uv2 end -- luacheck: ignore
+  end
+end
+
+local ok, err = pcall(testcase)
+
+test:is(ok, false, 'assertion is triggered in a function with testcase')
+test:ok(err:match(assert_msg), 'BC_UCLO does not trigger an infinite loop')
+
+test:done(true)