diff --git a/datetime/src/main/java/com/fasterxml/jackson/datatype/jsr310/DecimalUtils.java b/datetime/src/main/java/com/fasterxml/jackson/datatype/jsr310/DecimalUtils.java
index ad9ead2f..a76c0139 100644
--- a/datetime/src/main/java/com/fasterxml/jackson/datatype/jsr310/DecimalUtils.java
+++ b/datetime/src/main/java/com/fasterxml/jackson/datatype/jsr310/DecimalUtils.java
@@ -84,6 +84,14 @@ public static String toDecimal(long seconds, int nanoseconds)
      */
     public static BigDecimal toBigDecimal(long seconds, int nanoseconds)
     {
+        // [modules-java8#359] For negative seconds with positive nanos (times before epoch),
+        // we need to compute the proper decimal value: seconds + (nanos / 1_000_000_000)
+        // Example: Instant{epochSecond=-1, nano=999000000} represents -0.001 seconds
+        if (seconds < 0 && nanoseconds > 0) {
+            return BigDecimal.valueOf(seconds)
+                .add(BigDecimal.valueOf(nanoseconds).scaleByPowerOfTen(-9));
+        }
+
         if (nanoseconds == 0L) {
             // 14-Mar-2015, tatu: Let's retain one zero to avoid interpretation
             //    as integral number
diff --git a/datetime/src/main/java/com/fasterxml/jackson/datatype/jsr310/deser/InstantDeserializer.java b/datetime/src/main/java/com/fasterxml/jackson/datatype/jsr310/deser/InstantDeserializer.java
index 0e1bf808..c882d541 100644
--- a/datetime/src/main/java/com/fasterxml/jackson/datatype/jsr310/deser/InstantDeserializer.java
+++ b/datetime/src/main/java/com/fasterxml/jackson/datatype/jsr310/deser/InstantDeserializer.java
@@ -480,8 +480,9 @@ protected T _fromDecimal(DeserializationContext context, BigDecimal value)
     {
         FromDecimalArguments args =
             DecimalUtils.extractSecondsAndNanos(value, (s, ns) -> new FromDecimalArguments(s, ns, getZone(context)),
-                    // [modules-java8#337] since 2.19, only Instant needs negative adjustment
-                    true);
+                    // [modules-java8#359] since 2.21, Instant.ofEpochSecond() correctly handles
+                    // negative nanoseconds, so no adjustment needed
+                    false);
         return fromNanoseconds.apply(args);
     }
 
diff --git a/datetime/src/test/java/com/fasterxml/jackson/datatype/jsr310/tofix/InstantDeserializerNegative359Test.java b/datetime/src/test/java/com/fasterxml/jackson/datatype/jsr310/deser/InstantDeserializerNegative359Test.java
similarity index 86%
rename from datetime/src/test/java/com/fasterxml/jackson/datatype/jsr310/tofix/InstantDeserializerNegative359Test.java
rename to datetime/src/test/java/com/fasterxml/jackson/datatype/jsr310/deser/InstantDeserializerNegative359Test.java
index 44ce23bf..ac4e5089 100644
--- a/datetime/src/test/java/com/fasterxml/jackson/datatype/jsr310/tofix/InstantDeserializerNegative359Test.java
+++ b/datetime/src/test/java/com/fasterxml/jackson/datatype/jsr310/deser/InstantDeserializerNegative359Test.java
@@ -1,4 +1,4 @@
-package com.fasterxml.jackson.datatype.jsr310.tofix;
+package com.fasterxml.jackson.datatype.jsr310.deser;
 
 import java.time.Instant;
 
@@ -6,7 +6,6 @@
 
 import com.fasterxml.jackson.databind.ObjectReader;
 import com.fasterxml.jackson.datatype.jsr310.ModuleTestBase;
-import com.fasterxml.jackson.datatype.jsr310.testutil.failure.JacksonTestFailureExpected;
 
 import static org.junit.jupiter.api.Assertions.assertEquals;
 
@@ -18,7 +17,6 @@ public class InstantDeserializerNegative359Test
 {
     private final ObjectReader READER = newMapper().readerFor(Instant.class);
 
-    @JacksonTestFailureExpected
     @Test
     public void testDeserializationAsFloat04()
         throws Exception
diff --git a/release-notes/CREDITS-2.x b/release-notes/CREDITS-2.x
index 39c41bf9..f75b3900 100644
--- a/release-notes/CREDITS-2.x
+++ b/release-notes/CREDITS-2.x
@@ -213,6 +213,9 @@ Kevin Mahon (@Strongbeard)
  * Fixed #291: `InstantDeserializer` fails to parse negative numeric timestamp strings
    for pre-1970 values
   (2.18.4)
+ * Reported #359: `InstantDeserializer` deserializes the nanosecond portion of fractional
+   negative timestamps incorrectly
+  (2.21.0)
 
 Joey Muia (@jmuia)
  * Reported #337: Negative `Duration` does not round-trip properly with
diff --git a/release-notes/VERSION-2.x b/release-notes/VERSION-2.x
index dd8ac134..f830b290 100644
--- a/release-notes/VERSION-2.x
+++ b/release-notes/VERSION-2.x
@@ -10,6 +10,11 @@ Modules:
 
 2.21.0 (not yet released)
 
+#359: `InstantDeserializer` deserializes the nanosecond portion of fractional
+  negative timestamps incorrectly
+ (reported by Kevin M)
+ (fix by @cowtowncoder, w/ Claude code)
+
 No changes since 2.20
 
 2.20.1 (30-Oct-2025)