diff --git a/dune b/dune
index 00e05f1..dbdc2c7 100644
--- a/dune
+++ b/dune
@@ -39,6 +39,7 @@
   (preprocess
     (per_module
       ((pps lwt_ppx)
+       gzip_io
        httpev
        logstash
        lwt_flag
diff --git a/gzip_io.ml b/gzip_io.ml
index f962199..55fe25d 100644
--- a/gzip_io.ml
+++ b/gzip_io.ml
@@ -36,6 +36,31 @@ let string s =
   IO.nwrite out (Bytes.unsafe_of_string s); (* IO wrong type *)
   IO.close_out out
 
+let string_lwt ?(chunk_size = 3000) ?(yield = Lwt.pause) s =
+  let out = output (IO.output_string ()) in
+  let buff = Buffer.create chunk_size in
+  let len = String.length s in
+  let rec loop i =
+    if i >= len then (
+      (* Final flush of the buffer if there's any residue *)
+      if Buffer.length buff > 0 then IO.nwrite out (Buffer.to_bytes buff);
+      Lwt.return_unit)
+    else begin
+      let c = s.[i] in
+      Buffer.add_char buff c;
+      if Buffer.length buff < chunk_size then loop (i + 1)
+      else (
+        (* Buffer is full, write and clear it *)
+        IO.nwrite out (Buffer.to_bytes buff);
+        Buffer.clear buff;
+        (* Yield after processing a chunk *)
+        let%lwt () = yield () in
+        loop (i + 1))
+    end
+  in
+  let%lwt () = loop 0 in
+  Lwt.return @@ IO.close_out out
+
 let to_string s =
   let inp = input (IO.input_string s) in
   let out = IO.output_string () in
diff --git a/httpev.ml b/httpev.ml
index 1e6b847..5ebcaa8 100644
--- a/httpev.ml
+++ b/httpev.ml
@@ -928,12 +928,15 @@ let send_reply c cout reply =
   end
   in
   (* possibly apply encoding *)
-  let (hdrs,body) =
+  let%lwt (hdrs,body) =
     (* TODO do not apply encoding to application/gzip *)
-    (* TODO gzip + chunked? *)
     match body, code, c.req with
-    | `Body s, `Ok, Ready { encoding=Gzip; _ } when String.length s > 128 -> ("Content-Encoding", "gzip")::hdrs, `Body (Gzip_io.string s)
-    | _ -> hdrs, body
+    | `Body s, `Ok, Ready { encoding=Gzip; _ } when String.length s > 128 ->
+      let%lwt body = Gzip_io.string_lwt s in
+      Lwt.return (("Content-Encoding", "gzip")::hdrs, `Body body)
+    | `Chunks _ as body, `Ok, Ready { encoding=Gzip; _ } -> 
+      Lwt.return (("Content-Encoding", "gzip")::hdrs, body)
+    | _ -> Lwt.return (hdrs, body)
   in
   let hdrs = match body with
   | `Body s -> ("Content-Length", string_of_int (String.length s)) :: hdrs
@@ -955,6 +958,10 @@ let send_reply c cout reply =
       let push = function
       | "" -> Lwt.return_unit
       | s ->
+        let%lwt s = match c.req with
+        | Ready { encoding=Gzip; _ } -> Gzip_io.string_lwt s
+        | _ -> Lwt.return s
+        in
         let%lwt () = Lwt_io.write cout (sprintf "%x\r\n" (String.length s)) in
         let%lwt () = Lwt_io.write cout s in
         Lwt_io.write cout "\r\n"