diff --git a/CHANGES.md b/CHANGES.md
index 111ad8d..3e9bd3f 100644
--- a/CHANGES.md
+++ b/CHANGES.md
@@ -3,6 +3,10 @@ HISTORY
 
 ## Unreleased
 
+## 4.2.1 (2018-01-14)
+
+Fixed a regression breaking IPython and discovered by https://github.com/spapini
+
 ## 4.2.0 (2018-01-14)
 
 Added a facility to define families of decorators (aka decorators with
diff --git a/docs/tests.documentation.rst b/docs/tests.documentation.rst
index 92836e2..97f264c 100644
--- a/docs/tests.documentation.rst
+++ b/docs/tests.documentation.rst
@@ -3,9 +3,9 @@ The ``decorator`` module
 
 :Author: Michele Simionato
 :E-mail: michele.simionato@gmail.com
-:Version: 4.2.0 (2018-01-14)
+:Version: 4.2.1 (2018-01-14)
 :Supports: Python 2.6, 2.7, 3.0, 3.1, 3.2, 3.3, 3.4, 3.5, 3.6
-:Download page: http://pypi.python.org/pypi/decorator/4.2.0
+:Download page: http://pypi.python.org/pypi/decorator/4.2.1
 :Installation: ``pip install decorator``
 :License: BSD license
 
diff --git a/src/decorator.py b/src/decorator.py
index 9f4eb2b..6e5db6f 100644
--- a/src/decorator.py
+++ b/src/decorator.py
@@ -40,7 +40,7 @@
 import itertools
 import collections
 
-__version__ = '4.2.0'
+__version__ = '4.2.1'
 
 if sys.version >= '3':
     from inspect import getfullargspec
@@ -261,7 +261,8 @@ def decorator(caller, _func=None):
             name = caller.__name__
         doc = caller.__doc__
         nargs = caller.__code__.co_argcount
-        defaultargs = ', '.join(caller.__code__.co_varnames[1:nargs])
+        ndefs = len(caller.__defaults__ or ())
+        defaultargs = ', '.join(caller.__code__.co_varnames[nargs-ndefs:nargs])
         if defaultargs:
             defaultargs += ','
         defaults = caller.__defaults__
diff --git a/src/tests/test.py b/src/tests/test.py
index 7eb8391..e5f2ff4 100644
--- a/src/tests/test.py
+++ b/src/tests/test.py
@@ -119,6 +119,12 @@ def func(**kw):
         # there is no confusion when passing args as a keyword argument
         self.assertEqual(func(args='a'), {'args': 'a'})
 
+    def test_decorator_factory(self):
+        # similar to what IPython is doing in traitlets.config.application
+        @decorator
+        def catch_config_error(method, app, *args, **kwargs):
+            return method(app)
+        catch_config_error(lambda app: None)
 
 # ################### test dispatch_on ############################# #
 # adapted from test_functools in Python 3.5