diff --git a/axum/CHANGELOG.md b/axum/CHANGELOG.md
index b3c8d3bedd9..117bb7d6e56 100644
--- a/axum/CHANGELOG.md
+++ b/axum/CHANGELOG.md
@@ -7,7 +7,7 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 
 # Unreleased
 
-- None.
+- **fixed:** Fallback handlers on nested routers returning 404
 
 # 0.7.4 (13. January, 2024)
 
diff --git a/axum/src/routing/path_router.rs b/axum/src/routing/path_router.rs
index e9353dc7485..47f8ddce3a7 100644
--- a/axum/src/routing/path_router.rs
+++ b/axum/src/routing/path_router.rs
@@ -180,6 +180,7 @@ where
                 .expect("no path for route id. This is a bug in axum. Please file an issue");
 
             let path = path_for_nested_route(prefix, inner_path);
+            let route_nested_root = !path.ends_with('/') && "/".eq(inner_path.as_ref());
 
             let layer = (
                 StripPrefix::layer(prefix),
@@ -187,9 +188,18 @@ where
             );
             match endpoint.layer(layer) {
                 Endpoint::MethodRouter(method_router) => {
+                    if IS_FALLBACK && route_nested_root {
+                        let path = format!("{path}/");
+                        self.route(&path, method_router.clone())?;
+                    }
                     self.route(&path, method_router)?;
                 }
                 Endpoint::Route(route) => {
+                    if IS_FALLBACK && route_nested_root {
+                        let path = format!("{path}/");
+                        self.route_endpoint(&path, Endpoint::Route(route.clone()))?;
+                    }
+
                     self.route_endpoint(&path, Endpoint::Route(route))?;
                 }
             }
diff --git a/axum/src/routing/tests/nest.rs b/axum/src/routing/tests/nest.rs
index 0e6008123bb..92b221a2cb6 100644
--- a/axum/src/routing/tests/nest.rs
+++ b/axum/src/routing/tests/nest.rs
@@ -383,6 +383,19 @@ async fn nesting_with_root_inner_router() {
     assert_eq!(res.status(), StatusCode::OK);
 }
 
+#[tokio::test]
+async fn nesting_with_root_inner_fallback() {
+    let app = Router::new().nest("/router", Router::new().fallback(get(|| async {})));
+
+    let client = TestClient::new(app);
+
+    let res = client.get("/router").await;
+    assert_eq!(res.status(), StatusCode::OK);
+
+    let res = client.get("/router/").await;
+    assert_eq!(res.status(), StatusCode::OK);
+}
+
 macro_rules! nested_route_test {
     (
         $name:ident,