diff --git a/docs/en/advanced/navigation-guards.md b/docs/en/advanced/navigation-guards.md
index 5217e958d..71b3d9a45 100644
--- a/docs/en/advanced/navigation-guards.md
+++ b/docs/en/advanced/navigation-guards.md
@@ -116,17 +116,19 @@ beforeRouteEnter (to, from, next) {
 }
 ```
 
-Note that `beforeRouteEnter` is the only guard that supports passing a callback to `next`. For `beforeRouteUpdate` and `beforeRouteLeave`, `this` is already available, so passing a callback is unnecessary and therefore *not supported*:
-
 ```js
 beforeRouteUpdate (to, from, next) {
-  // just use `this`
+  // may use `this`
   this.name = to.params.name
-  next()
+
+  // may also pass a callback to next
+  next(vm => {
+    vm.name = to.params.name
+  })
 }
 ```
 
-The **leave guard** is usually used to prevent the user from accidentally leaving the route with unsaved edits. The navigation can be canceled by calling `next(false)`.
+The **leave guard** is usually used to prevent the user from accidentally leaving the route with unsaved edits. The navigation can be canceled by calling `next(false)`. Note that `beforeRouteLeave` is the only guard that does not support passing a callback to `next`.
 
 ```js
 beforeRouteLeave (to, from , next) {
diff --git a/examples/navigation-guards/app.js b/examples/navigation-guards/app.js
index 86f33c95e..d9ca3db7d 100644
--- a/examples/navigation-guards/app.js
+++ b/examples/navigation-guards/app.js
@@ -33,7 +33,7 @@ const Baz = {
   },
   template: `
     <div>
-      <p>baz ({{ saved ? 'saved' : 'not saved' }})<p>
+      <p>baz ({{ saved ? 'saved' : 'not saved' }})</p>
       <button @click="saved = true">save</button>
     </div>
   `,
@@ -46,7 +46,7 @@ const Baz = {
   }
 }
 
-// Baz implements an in-component beforeRouteEnter hook
+// Qux implements an in-component beforeRouteEnter hook
 const Qux = {
   data () {
     return {
@@ -87,6 +87,57 @@ const Quux = {
   }
 }
 
+// Nested implements an in-component beforeRouteUpdate hook that uses
+// next(vm => {})
+const Nested = {
+  data () {
+    return {
+      calls: 0,
+      updates: 0
+    }
+  },
+  template: `
+    <div>
+      <p>
+        nested calls:{{ calls }} updates:{{ updates }}
+      </p>
+      <router-view></router-view>
+    </div>
+  `,
+  beforeRouteUpdate (to, from, next) {
+    // calls is incremented every time anything navigates, even if the
+    // navigation is canceled by a child component.
+    this.calls++
+
+    next(vm => {
+      // updates is only incremented once all children confirm and complete
+      // navigation. If any children load data async, then this will not be
+      // called until all children have called next() themselves. If any child
+      // cancels navigation, then this will never be called.
+      vm.updates++
+    })
+  }
+}
+
+// Buux implements a cancelable beforeRouteUpdate hook
+const Buux = {
+  data () {
+    return {
+      prevId: 0
+    }
+  },
+  template: `<div>buux id:{{ $route.params.id }} prevId:{{ prevId }}</div>`,
+  beforeRouteUpdate (to, from, next) {
+    if (window.confirm(`Navigate to ${to.path}?`)) {
+      next(vm => {
+        vm.prevId = from.params.id
+      })
+    } else {
+      next(false)
+    }
+  }
+}
+
 const router = new VueRouter({
   mode: 'history',
   base: __dirname,
@@ -114,7 +165,14 @@ const router = new VueRouter({
     } },
 
     // in-component beforeRouteUpdate hook
-    { path: '/quux/:id', component: Quux }
+    { path: '/quux/:id', component: Quux },
+    { path: '/nested', component: Nested,
+      children: [
+        { path: '', component: Home },
+        { path: 'qux', component: Qux },
+        { path: 'buux/:id', component: Buux }
+      ]
+    }
   ]
 })
 
@@ -140,6 +198,10 @@ new Vue({
         <li><router-link to="/qux-async">/qux-async</router-link></li>
         <li><router-link to="/quux/1">/quux/1</router-link></li>
         <li><router-link to="/quux/2">/quux/2</router-link></li>
+        <li><router-link to="/nested">/nested</router-link></li>
+        <li><router-link to="/nested/qux">/nested/qux</router-link></li>
+        <li><router-link to="/nested/buux/1">/nested/buux/1</router-link></li>
+        <li><router-link to="/nested/buux/2">/nested/buux/2</router-link></li>
       </ul>
       <router-view class="view"></router-view>
     </div>
diff --git a/src/history/base.js b/src/history/base.js
index 0c90dafa7..f8f135353 100644
--- a/src/history/base.js
+++ b/src/history/base.js
@@ -112,13 +112,15 @@ export class History {
       activated
     } = resolveQueue(this.current.matched, route.matched)
 
+    const postCbs = []
+    const isValid = () => this.current === route
     const queue: Array<?NavigationGuard> = [].concat(
       // in-component leave guards
       extractLeaveGuards(deactivated),
       // global before hooks
       this.router.beforeHooks,
       // in-component update hooks
-      extractUpdateHooks(updated),
+      extractUpdateHooks(updated, postCbs, isValid),
       // in-config enter guards
       activated.map(m => m.beforeEnter),
       // async components
@@ -161,11 +163,9 @@ export class History {
     }
 
     runQueue(queue, iterator, () => {
-      const postEnterCbs = []
-      const isValid = () => this.current === route
       // wait until async components are resolved before
       // extracting in-component enter guards
-      const enterGuards = extractEnterGuards(activated, postEnterCbs, isValid)
+      const enterGuards = extractEnterGuards(activated, postCbs, isValid)
       const queue = enterGuards.concat(this.router.resolveHooks)
       runQueue(queue, iterator, () => {
         if (this.pending !== route) {
@@ -175,7 +175,7 @@ export class History {
         onComplete(route)
         if (this.router.app) {
           this.router.app.$nextTick(() => {
-            postEnterCbs.forEach(cb => { cb() })
+            postCbs.forEach(cb => { cb() })
           })
         }
       })
@@ -266,10 +266,6 @@ function extractLeaveGuards (deactivated: Array<RouteRecord>): Array<?Function>
   return extractGuards(deactivated, 'beforeRouteLeave', bindGuard, true)
 }
 
-function extractUpdateHooks (updated: Array<RouteRecord>): Array<?Function> {
-  return extractGuards(updated, 'beforeRouteUpdate', bindGuard)
-}
-
 function bindGuard (guard: NavigationGuard, instance: ?_Vue): ?NavigationGuard {
   if (instance) {
     return function boundRouteGuard () {
@@ -278,24 +274,37 @@ function bindGuard (guard: NavigationGuard, instance: ?_Vue): ?NavigationGuard {
   }
 }
 
+function extractUpdateHooks (
+  updated: Array<RouteRecord>,
+  cbs: Array<Function>,
+  isValid: () => boolean
+): Array<?Function> {
+  return extractGuards(updated, 'beforeRouteUpdate', (guard, instance, match, key) => {
+    var boundGuard = bindGuard(guard, instance)
+    if (boundGuard) {
+      return bindCbGuard(boundGuard, match, key, cbs, isValid)
+    }
+  })
+}
+
 function extractEnterGuards (
   activated: Array<RouteRecord>,
   cbs: Array<Function>,
   isValid: () => boolean
 ): Array<?Function> {
   return extractGuards(activated, 'beforeRouteEnter', (guard, _, match, key) => {
-    return bindEnterGuard(guard, match, key, cbs, isValid)
+    return bindCbGuard(guard, match, key, cbs, isValid)
   })
 }
 
-function bindEnterGuard (
+function bindCbGuard (
   guard: NavigationGuard,
   match: RouteRecord,
   key: string,
   cbs: Array<Function>,
   isValid: () => boolean
 ): NavigationGuard {
-  return function routeEnterGuard (to, from, next) {
+  return function (to, from, next) {
     return guard(to, from, cb => {
       next(cb)
       if (typeof cb === 'function') {
diff --git a/test/e2e/specs/navigation-guards.js b/test/e2e/specs/navigation-guards.js
index a5afbc104..3798e222c 100644
--- a/test/e2e/specs/navigation-guards.js
+++ b/test/e2e/specs/navigation-guards.js
@@ -8,7 +8,7 @@ module.exports = {
     browser
     .url('http://localhost:8080/navigation-guards/')
       .waitForElementVisible('#app', 1000)
-      .assert.count('li a', 8)
+      .assert.count('li a', 12)
       .assert.containsText('.view', 'home')
 
       .click('li:nth-child(2) a')
@@ -130,6 +130,32 @@ module.exports = {
     .click('li:nth-child(7) a')
       .assert.urlEquals('http://localhost:8080/navigation-guards/quux/1')
       .assert.containsText('.view', 'id:1 prevId:2')
-      .end()
+    .click('li:nth-child(9) a')
+      .assert.urlEquals('http://localhost:8080/navigation-guards/nested')
+      .assert.containsText('.view', 'nested calls:0 updates:0')
+    .click('li:nth-child(10) a')
+      .assert.containsText('.view', 'nested calls:1 updates:0')
+      .waitFor(300)
+      .assert.urlEquals('http://localhost:8080/navigation-guards/nested/qux')
+      .assert.containsText('.view', 'nested calls:1 updates:1')
+      .assert.containsText('.view', 'Qux')
+    .click('li:nth-child(11) a')
+      .assert.urlEquals('http://localhost:8080/navigation-guards/nested/buux/1')
+      .assert.containsText('.view', 'nested calls:2 updates:2')
+      .assert.containsText('.view', 'buux id:1 prevId:0')
+    .click('li:nth-child(12) a')
+      .dismissAlert()
+      .assert.urlEquals('http://localhost:8080/navigation-guards/nested/buux/1')
+      .assert.containsText('.view', 'nested calls:3 updates:2')
+      .assert.containsText('.view', 'buux id:1 prevId:0')
+    .click('li:nth-child(12) a')
+      .acceptAlert()
+      .assert.urlEquals('http://localhost:8080/navigation-guards/nested/buux/2')
+      .assert.containsText('.view', 'nested calls:4 updates:3')
+      .assert.containsText('.view', 'buux id:2 prevId:1')
+    .click('li:nth-child(9) a')
+      .assert.urlEquals('http://localhost:8080/navigation-guards/nested')
+      .assert.containsText('.view', 'nested calls:5 updates:4')
+    .end()
   }
 }