diff --git a/Lib/test/test_sys_settrace.py b/Lib/test/test_sys_settrace.py
index 3fe0bb7f460b9a..b565bef4c44239 100644
--- a/Lib/test/test_sys_settrace.py
+++ b/Lib/test/test_sys_settrace.py
@@ -1137,6 +1137,38 @@ def func():
             (7, 'line'),
             (7, 'return')])
 
+    def test_tracing_exception_raised_in_with(self):
+
+        class NullCtx:
+            def __enter__(self):
+                return self
+            def __exit__(self, *excinfo):
+                pass
+
+        def func():
+            try:
+                with NullCtx():
+                    1/0
+            except ZeroDivisionError:
+                pass
+
+        self.run_and_compare(func,
+            [(0, 'call'),
+             (1, 'line'),
+             (2, 'line'),
+             (-5, 'call'),
+             (-4, 'line'),
+             (-4, 'return'),
+             (3, 'line'),
+             (3, 'exception'),
+             (2, 'line'),
+             (-3, 'call'),
+             (-2, 'line'),
+             (-2, 'return'),
+             (4, 'line'),
+             (5, 'line'),
+             (5, 'return')])
+
 
 class SkipLineEventsTraceTestCase(TraceTestCase):
     """Repeat the trace tests, but with per-line events skipped"""
diff --git a/Misc/NEWS.d/next/Core and Builtins/2021-11-19-13-17-47.bpo-45709.H_t7ut.rst b/Misc/NEWS.d/next/Core and Builtins/2021-11-19-13-17-47.bpo-45709.H_t7ut.rst
new file mode 100644
index 00000000000000..e3b007048cd6ca
--- /dev/null
+++ b/Misc/NEWS.d/next/Core and Builtins/2021-11-19-13-17-47.bpo-45709.H_t7ut.rst	
@@ -0,0 +1,2 @@
+Restore behavior from 3.10 when tracing an exception raised within a with
+statement.
diff --git a/Python/ceval.c b/Python/ceval.c
index 9d3ff74bace6c8..9e56b50ee844b4 100644
--- a/Python/ceval.c
+++ b/Python/ceval.c
@@ -5093,10 +5093,7 @@ MISS_WITH_OPARG_COUNTER(STORE_SUBSCR)
         JUMPTO(handler);
         /* Resume normal execution */
         frame->f_state = FRAME_EXECUTING;
-        frame->f_lasti = handler;
-        NEXTOPARG();
-        PRE_DISPATCH_GOTO();
-        DISPATCH_GOTO();
+        DISPATCH();
     }
 
 exiting: