diff --git a/exist-core/src/main/java/org/exist/xquery/XQueryWatchDog.java b/exist-core/src/main/java/org/exist/xquery/XQueryWatchDog.java
index ce6cdc38e69..d196d63385d 100644
--- a/exist-core/src/main/java/org/exist/xquery/XQueryWatchDog.java
+++ b/exist-core/src/main/java/org/exist/xquery/XQueryWatchDog.java
@@ -113,6 +113,9 @@ public void setTimeoutFromOption(Option option) throws XPathException {
 		} catch (final NumberFormatException e) {
 			throw new XPathException((Expression) null, "Error parsing timeout value in option " + option.getQName().getStringValue());
 		}
+		if (timeout <= 0) {
+			timeout = Long.MAX_VALUE;
+		}
 		if (LOG.isDebugEnabled()) {
 			final NumberFormat nf = NumberFormat.getNumberInstance();
             LOG.debug("timeout set from option: {} ms.", nf.format(timeout));
diff --git a/exist-core/src/test/java/org/exist/xquery/XQueryWatchDogTest.java b/exist-core/src/test/java/org/exist/xquery/XQueryWatchDogTest.java
new file mode 100644
index 00000000000..f19d4286a5c
--- /dev/null
+++ b/exist-core/src/test/java/org/exist/xquery/XQueryWatchDogTest.java
@@ -0,0 +1,104 @@
+/*
+ * eXist-db Open Source Native XML Database
+ * Copyright (C) 2001 The eXist-db Authors
+ *
+ * info@exist-db.org
+ * http://www.exist-db.org
+ *
+ * This library is free software; you can redistribute it and/or
+ * modify it under the terms of the GNU Lesser General Public
+ * License as published by the Free Software Foundation; either
+ * version 2.1 of the License, or (at your option) any later version.
+ *
+ * This library is distributed in the hope that it will be useful,
+ * but WITHOUT ANY WARRANTY; without even the implied warranty of
+ * MERCHANTABILITY or FITNESS FOR A PARTICULAR PURPOSE.  See the GNU
+ * Lesser General Public License for more details.
+ *
+ * You should have received a copy of the GNU Lesser General Public
+ * License along with this library; if not, write to the Free Software
+ * Foundation, Inc., 51 Franklin Street, Fifth Floor, Boston, MA  02110-1301  USA
+ */
+package org.exist.xquery;
+
+import org.exist.Namespaces;
+import org.exist.dom.QName;
+import org.easymock.EasyMock;
+import org.junit.Test;
+
+import java.lang.reflect.Field;
+
+import static org.junit.Assert.assertEquals;
+
+/**
+ * Tests for {@link XQueryWatchDog}.
+ *
+ * @see <a href="https://github.com/eXist-db/exist/issues/2529">#2529</a>
+ */
+public class XQueryWatchDogTest {
+
+    private XQueryWatchDog createWatchDog() {
+        final XQueryContext context = EasyMock.createMockBuilder(XQueryContext.class)
+                .withConstructor()
+                .createMock();
+        return new XQueryWatchDog(context);
+    }
+
+    private long getTimeout(final XQueryWatchDog watchDog) throws Exception {
+        final Field f = XQueryWatchDog.class.getDeclaredField("timeout");
+        f.setAccessible(true);
+        return (long) f.get(watchDog);
+    }
+
+    private Option timeoutOption(final String value) throws XPathException {
+        return new Option(new QName("timeout", Namespaces.EXIST_NS, "exist"), value);
+    }
+
+    @Test
+    public void setTimeoutFromOptionNegativeOneDisablesTimeout() throws Exception {
+        final XQueryWatchDog watchDog = createWatchDog();
+        watchDog.setTimeoutFromOption(timeoutOption("-1"));
+        assertEquals(Long.MAX_VALUE, getTimeout(watchDog));
+    }
+
+    @Test
+    public void setTimeoutFromOptionZeroDisablesTimeout() throws Exception {
+        final XQueryWatchDog watchDog = createWatchDog();
+        watchDog.setTimeoutFromOption(timeoutOption("0"));
+        assertEquals(Long.MAX_VALUE, getTimeout(watchDog));
+    }
+
+    @Test
+    public void setTimeoutFromOptionPositiveValueSetsTimeout() throws Exception {
+        final XQueryWatchDog watchDog = createWatchDog();
+        watchDog.setTimeoutFromOption(timeoutOption("30000"));
+        assertEquals(30000L, getTimeout(watchDog));
+    }
+
+    @Test
+    public void setTimeoutFromOptionNegativeValueDisablesTimeout() throws Exception {
+        final XQueryWatchDog watchDog = createWatchDog();
+        watchDog.setTimeoutFromOption(timeoutOption("-500"));
+        assertEquals(Long.MAX_VALUE, getTimeout(watchDog));
+    }
+
+    @Test(expected = XPathException.class)
+    public void setTimeoutFromOptionNonNumericThrowsException() throws Exception {
+        final XQueryWatchDog watchDog = createWatchDog();
+        watchDog.setTimeoutFromOption(timeoutOption("abc"));
+    }
+
+    @Test(expected = XPathException.class)
+    public void setTimeoutFromOptionMultipleValuesThrowsException() throws Exception {
+        final XQueryWatchDog watchDog = createWatchDog();
+        watchDog.setTimeoutFromOption(timeoutOption("100 200"));
+    }
+
+    @Test
+    public void proceedDoesNotThrowWhenTimeoutDisabledViaOption() throws Exception {
+        final XQueryWatchDog watchDog = createWatchDog();
+        watchDog.setTimeoutFromOption(timeoutOption("-1"));
+        // Should not throw TerminatedException even though startTime is in the past
+        watchDog.proceed(null);
+    }
+}