diff --git a/x/wasm/keeper/keeper.go b/x/wasm/keeper/keeper.go
index 020c2b08..438059bd 100644
--- a/x/wasm/keeper/keeper.go
+++ b/x/wasm/keeper/keeper.go
@@ -1080,6 +1080,7 @@ func (h DefaultWasmVMContractResponseHandler) Handle(ctx sdk.Context, contractAd
 	case rsp != nil:
 		result = rsp
 	}
+	// TODO: remove this - handled inside DispatchSubmessages
 	// emit non message type events only
 	for _, e := range em.Events() {
 		if e.Type != sdk.EventTypeMessage {
diff --git a/x/wasm/keeper/msg_dispatcher_test.go b/x/wasm/keeper/msg_dispatcher_test.go
index 94d6f322..fc3f73fb 100644
--- a/x/wasm/keeper/msg_dispatcher_test.go
+++ b/x/wasm/keeper/msg_dispatcher_test.go
@@ -85,6 +85,7 @@ func TestDispatchSubmessages(t *testing.T) {
 			}},
 			replyer: &mockReplyer{
 				replyFn: func(ctx sdk.Context, contractAddress sdk.AccAddress, reply wasmvmtypes.Reply) ([]byte, error) {
+					ctx.EventManager().EmitEvent(sdk.NewEvent("wasm-reply"))
 					return []byte("myReplyData"), nil
 				},
 			},
@@ -99,7 +100,9 @@ func TestDispatchSubmessages(t *testing.T) {
 			expEvents: []sdk.Event{{
 				Type:       "myEvent",
 				Attributes: []abci.EventAttribute{{Key: []byte("foo"), Value: []byte("bar")}},
-			}},
+			},
+				sdk.NewEvent("wasm-reply"),
+			},
 		},
 		"with context events - released on commit": {
 			msgs: []wasmvmtypes.SubMsg{{
@@ -266,6 +269,53 @@ func TestDispatchSubmessages(t *testing.T) {
 			expData:    []byte{},
 			expCommits: []bool{false, false},
 		},
+		"reply gets proper events": {
+			msgs: []wasmvmtypes.SubMsg{{ID: 1, ReplyOn: wasmvmtypes.ReplyAlways}},
+			replyer: &mockReplyer{
+				replyFn: func(ctx sdk.Context, contractAddress sdk.AccAddress, reply wasmvmtypes.Reply) ([]byte, error) {
+					if reply.Result.Err != "" {
+						return nil, errors.New(reply.Result.Err)
+					}
+					res := reply.Result.Ok
+
+					// ensure the input events are what we expect
+					// I didn't use require.Equal() to act more like a contract... but maybe that would be better
+					if len(res.Events) != 2 {
+						return nil, fmt.Errorf("event count: %#v", res.Events)
+					}
+					if res.Events[0].Type != "execute" {
+						return nil, fmt.Errorf("event0: %#v", res.Events[0])
+					}
+					if res.Events[0].Type != "wasm" {
+						return nil, fmt.Errorf("event1: %#v", res.Events[1])
+					}
+
+					// let's add a custom event here and see if it makes it out
+					ctx.EventManager().EmitEvent(sdk.NewEvent("wasm-reply"))
+
+					// update data from what we got in
+					return res.Data, nil
+				},
+			},
+			msgHandler: &wasmtesting.MockMessageHandler{
+				DispatchMsgFn: func(ctx sdk.Context, contractAddr sdk.AccAddress, contractIBCPortID string, msg wasmvmtypes.CosmosMsg) (events []sdk.Event, data [][]byte, err error) {
+					events = []sdk.Event{
+						sdk.NewEvent("message", sdk.NewAttribute("_contract_address", contractAddr.String())),
+						// we don't know what the contarctAddr will be so we can't use it in the final tests
+						sdk.NewEvent("execute", sdk.NewAttribute("_contract_address", "placeholder-random-addr")),
+						sdk.NewEvent("wasm", sdk.NewAttribute("random", "data")),
+					}
+					return events, [][]byte{[]byte("subData")}, nil
+				},
+			},
+			expData:    []byte("subData"),
+			expCommits: []bool{true},
+			expEvents: []sdk.Event{
+				sdk.NewEvent("execute", sdk.NewAttribute("_contract_address", "placeholder-random-addr")),
+				sdk.NewEvent("wasm", sdk.NewAttribute("random", "data")),
+				sdk.NewEvent("wasm-reply"),
+			},
+		},
 	}
 	for name, spec := range specs {
 		t.Run(name, func(t *testing.T) {