diff --git a/packages/react-server/src/ReactFlightServer.js b/packages/react-server/src/ReactFlightServer.js
index e82171d24de5..97bee6c04c60 100644
--- a/packages/react-server/src/ReactFlightServer.js
+++ b/packages/react-server/src/ReactFlightServer.js
@@ -460,7 +460,7 @@ export function resolveModelToJSON(
         const newSegment = createSegment(request, () => value);
         const ping = newSegment.ping;
         x.then(ping, ping);
-        return serializeByValueID(newSegment.id);
+        return serializeByRefID(newSegment.id);
       } else {
         // Something errored. Don't bother encoding anything up to here.
         throw x;
@@ -708,6 +708,7 @@ function flushCompletedChunks(request: Request): void {
         break;
       }
     }
+    moduleChunks.splice(0, i);
     // Next comes model data.
     const jsonChunks = request.completedJSONChunks;
     i = 0;
diff --git a/packages/react-transport-dom-webpack/src/__tests__/ReactFlightDOM-test.js b/packages/react-transport-dom-webpack/src/__tests__/ReactFlightDOM-test.js
index ebabf4e75f5f..8b690219ec6e 100644
--- a/packages/react-transport-dom-webpack/src/__tests__/ReactFlightDOM-test.js
+++ b/packages/react-transport-dom-webpack/src/__tests__/ReactFlightDOM-test.js
@@ -64,28 +64,34 @@ describe('ReactFlightDOM', () => {
     };
   }
 
-  function block(render, load) {
+  function moduleReference(moduleExport) {
     const idx = webpackModuleIdx++;
     webpackModules[idx] = {
-      d: render,
+      d: moduleExport,
     };
     webpackMap['path/' + idx] = {
       id: '' + idx,
       chunks: [],
       name: 'd',
     };
+    const MODULE_TAG = Symbol.for('react.module.reference');
+    return {$$typeof: MODULE_TAG, name: 'path/' + idx};
+  }
+
+  function block(render, load) {
     if (load === undefined) {
       return () => {
-        return ReactTransportDOMServerRuntime.serverBlockNoData('path/' + idx);
+        return ReactTransportDOMServerRuntime.serverBlockNoData(
+          moduleReference(render),
+        );
       };
     }
     return function(...args) {
       const curriedLoad = () => {
         return load(...args);
       };
-      const MODULE_TAG = Symbol.for('react.module.reference');
       return ReactTransportDOMServerRuntime.serverBlock(
-        {$$typeof: MODULE_TAG, name: 'path/' + idx},
+        moduleReference(render),
         curriedLoad,
       );
     };
@@ -314,6 +320,9 @@ describe('ReactFlightDOM', () => {
         return 'data';
       }
       function DelayedText({children}, data) {
+        if (data !== 'data') {
+          throw new Error('No data');
+        }
         return <Text>{children}</Text>;
       }
       const loadBlock = block(DelayedText, load);
@@ -477,4 +486,196 @@ describe('ReactFlightDOM', () => {
         '<p>Game over</p>', // TODO: should not have message in prod.
     );
   });
+
+  // @gate experimental
+  it('should progressively reveal server components', async () => {
+    const {Suspense} = React;
+
+    // Client Components
+
+    class ErrorBoundary extends React.Component {
+      state = {hasError: false, error: null};
+      static getDerivedStateFromError(error) {
+        return {
+          hasError: true,
+          error,
+        };
+      }
+      render() {
+        if (this.state.hasError) {
+          return this.props.fallback(this.state.error);
+        }
+        return this.props.children;
+      }
+    }
+
+    function MyErrorBoundary({children}) {
+      return (
+        <ErrorBoundary fallback={e => <p>{e.message}</p>}>
+          {children}
+        </ErrorBoundary>
+      );
+    }
+
+    function Placeholder({children, fallback}) {
+      return <Suspense fallback={fallback}>{children}</Suspense>;
+    }
+
+    // Model
+    function Text({children}) {
+      return children;
+    }
+
+    function makeDelayedText() {
+      let error, _resolve, _reject;
+      let promise = new Promise((resolve, reject) => {
+        _resolve = () => {
+          promise = null;
+          resolve();
+        };
+        _reject = e => {
+          error = e;
+          promise = null;
+          reject(e);
+        };
+      });
+      function DelayedText({children}, data) {
+        if (promise) {
+          throw promise;
+        }
+        if (error) {
+          throw error;
+        }
+        return <Text>{children}</Text>;
+      }
+      return [DelayedText, _resolve, _reject];
+    }
+
+    const [Friends, resolveFriends] = makeDelayedText();
+    const [Name, resolveName] = makeDelayedText();
+    const [Posts, resolvePosts] = makeDelayedText();
+    const [Photos, resolvePhotos] = makeDelayedText();
+    const [Games, , rejectGames] = makeDelayedText();
+
+    // View
+    function ProfileDetails({avatar}) {
+      return (
+        <div>
+          <Name>:name:</Name>
+          {avatar}
+        </div>
+      );
+    }
+    function ProfileSidebar({friends}) {
+      return (
+        <div>
+          <Photos>:photos:</Photos>
+          {friends}
+        </div>
+      );
+    }
+    function ProfilePosts({posts}) {
+      return <div>{posts}</div>;
+    }
+    function ProfileGames({games}) {
+      return <div>{games}</div>;
+    }
+
+    const MyErrorBoundaryClient = moduleReference(MyErrorBoundary);
+    const PlaceholderClient = moduleReference(Placeholder);
+
+    function ProfileContent() {
+      return (
+        <>
+          <ProfileDetails avatar={<Text>:avatar:</Text>} />
+          <PlaceholderClient fallback={<p>(loading sidebar)</p>}>
+            <ProfileSidebar friends={<Friends>:friends:</Friends>} />
+          </PlaceholderClient>
+          <PlaceholderClient fallback={<p>(loading posts)</p>}>
+            <ProfilePosts posts={<Posts>:posts:</Posts>} />
+          </PlaceholderClient>
+          <MyErrorBoundaryClient>
+            <PlaceholderClient fallback={<p>(loading games)</p>}>
+              <ProfileGames games={<Games>:games:</Games>} />
+            </PlaceholderClient>
+          </MyErrorBoundaryClient>
+        </>
+      );
+    }
+
+    const model = {
+      rootContent: <ProfileContent />,
+    };
+
+    function ProfilePage({response}) {
+      return response.readRoot().rootContent;
+    }
+
+    const {writable, readable} = getTestStream();
+    ReactTransportDOMServer.pipeToNodeWritable(model, writable, webpackMap);
+    const response = ReactTransportDOMClient.createFromReadableStream(readable);
+
+    const container = document.createElement('div');
+    const root = ReactDOM.unstable_createRoot(container);
+    await act(async () => {
+      root.render(
+        <Suspense fallback={<p>(loading)</p>}>
+          <ProfilePage response={response} />
+        </Suspense>,
+      );
+    });
+    expect(container.innerHTML).toBe('<p>(loading)</p>');
+
+    // This isn't enough to show anything.
+    await act(async () => {
+      resolveFriends();
+    });
+    expect(container.innerHTML).toBe('<p>(loading)</p>');
+
+    // We can now show the details. Sidebar and posts are still loading.
+    await act(async () => {
+      resolveName();
+    });
+    // Advance time enough to trigger a nested fallback.
+    jest.advanceTimersByTime(500);
+    expect(container.innerHTML).toBe(
+      '<div>:name::avatar:</div>' +
+        '<p>(loading sidebar)</p>' +
+        '<p>(loading posts)</p>' +
+        '<p>(loading games)</p>',
+    );
+
+    // Let's *fail* loading games.
+    await act(async () => {
+      rejectGames(new Error('Game over'));
+    });
+    expect(container.innerHTML).toBe(
+      '<div>:name::avatar:</div>' +
+        '<p>(loading sidebar)</p>' +
+        '<p>(loading posts)</p>' +
+        '<p>Game over</p>', // TODO: should not have message in prod.
+    );
+
+    // We can now show the sidebar.
+    await act(async () => {
+      resolvePhotos();
+    });
+    expect(container.innerHTML).toBe(
+      '<div>:name::avatar:</div>' +
+        '<div>:photos::friends:</div>' +
+        '<p>(loading posts)</p>' +
+        '<p>Game over</p>', // TODO: should not have message in prod.
+    );
+
+    // Show everything.
+    await act(async () => {
+      resolvePosts();
+    });
+    expect(container.innerHTML).toBe(
+      '<div>:name::avatar:</div>' +
+        '<div>:photos::friends:</div>' +
+        '<div>:posts:</div>' +
+        '<p>Game over</p>', // TODO: should not have message in prod.
+    );
+  });
 });