diff --git a/lib/ace/edit_session/folding.js b/lib/ace/edit_session/folding.js
index 0274cd58..a86c27ce 100644
--- a/lib/ace/edit_session/folding.js
+++ b/lib/ace/edit_session/folding.js
@@ -696,7 +696,8 @@ function Folding() {
             
         this.$foldMode = foldMode;
         
-        this.removeListener('change', this.$updateFoldWidgets);
+        this.off('change', this.$updateFoldWidgets);
+        this.off('tokenizerUpdate', this.$tokenizerUpdateFoldWidgets);
         this._emit("changeAnnotation");
         
         if (!foldMode || this.$foldStyle == "manual") {
@@ -709,8 +710,9 @@ function Folding() {
         this.getFoldWidgetRange = foldMode.getFoldWidgetRange.bind(foldMode, this, this.$foldStyle);
         
         this.$updateFoldWidgets = this.updateFoldWidgets.bind(this);
+        this.$tokenizerUpdateFoldWidgets = this.tokenizerUpdateFoldWidgets.bind(this);
         this.on('change', this.$updateFoldWidgets);
-        
+        this.on('tokenizerUpdate', this.$tokenizerUpdateFoldWidgets);
     };
 
     this.getParentFoldRangeData = function (row, ignoreCurrent) {
@@ -843,7 +845,13 @@ function Folding() {
             this.foldWidgets.splice.apply(this.foldWidgets, args);
         }
     };
-
+    this.tokenizerUpdateFoldWidgets = function(e) {
+        var rows = e.data;
+        if (rows.first != rows.last) {
+            if (this.foldWidgets.length > rows.first)
+                this.foldWidgets.splice(rows.first, this.foldWidgets.length);
+        }
+    }
 }
 
 exports.Folding = Folding;
diff --git a/lib/ace/mode/folding/html_test.js b/lib/ace/mode/folding/html_test.js
index 2698d936..3471ee57 100644
--- a/lib/ace/mode/folding/html_test.js
+++ b/lib/ace/mode/folding/html_test.js
@@ -153,6 +153,30 @@ module.exports = {
         
         assert.range(session.getFoldWidgetRange(0), 0, 5, 5, 0);
         assert.range(session.getFoldWidgetRange(5), 0, 5, 5, 0);
+    },
+    
+    "test: fold multiple nested optional elements": function() {
+        var session = new EditSession([
+            '<p>',
+            '<li>',
+            '<p>juhu',
+            '<p>',
+            'kinners',
+            '</li>'
+        ]);
+        
+        var mode = new HtmlMode();
+        session.setMode(mode);
+        session.setFoldStyle("markbeginend");
+        
+        assert.equal(session.getFoldWidget(0), "start");
+        assert.equal(session.getFoldWidget(1), "start");
+        assert.equal(session.getFoldWidget(2), "start");
+        assert.equal(session.getFoldWidget(3), "start");
+        assert.equal(session.getFoldWidget(4), "");
+        assert.equal(session.getFoldWidget(5), "end");
+        
+        assert.range(session.getFoldWidgetRange(1), 1, 4, 5, 0);
     }
 };
 
diff --git a/lib/ace/mode/folding/xml.js b/lib/ace/mode/folding/xml.js
index 3a353eba..27f57a8c 100644
--- a/lib/ace/mode/folding/xml.js
+++ b/lib/ace/mode/folding/xml.js
@@ -192,9 +192,6 @@ function is(token, type) {
             if (!tag || top.tagName == tag.tagName) {
                 return stack.pop();
             }
-            else if (this.optionalEndTags.hasOwnProperty(tag.tagName)) {
-                return;
-            }
             else if (this.optionalEndTags.hasOwnProperty(top.tagName)) {
                 stack.pop();
                 continue;
diff --git a/lib/ace/mode/php.js b/lib/ace/mode/php.js
index a44e79c6..2754ef51 100644
--- a/lib/ace/mode/php.js
+++ b/lib/ace/mode/php.js
@@ -110,6 +110,7 @@ var Mode = function(opts) {
         "css-": CssMode,
         "php-": PhpMode
     });
+    this.foldingRules.subModes["php-"] = new CStyleFoldMode();
 };
 oop.inherits(Mode, HtmlMode);