diff --git a/activerecord/CHANGELOG b/activerecord/CHANGELOG
index faa9ad3ca61b0..71601e35ef3c1 100644
--- a/activerecord/CHANGELOG
+++ b/activerecord/CHANGELOG
@@ -1,5 +1,7 @@
 *SVN*
 
+* belongs_to assignment creates a new proxy rather than modifying its target in-place.  #8412 [mmangino@elevatedrails.com]
+
 * Fix column type detection while loading fixtures.  Closes #7987 [roderickvd]
 
 * Document deep eager includes.  #6267 [Josh Susser, Dan Manges]
diff --git a/activerecord/lib/active_record/associations.rb b/activerecord/lib/active_record/associations.rb
index 48bc5ac624a68..4c5a781527af1 100755
--- a/activerecord/lib/active_record/associations.rb
+++ b/activerecord/lib/active_record/associations.rb
@@ -916,7 +916,7 @@ def association_accessor_methods(reflection, association_proxy_class)
 
           define_method("#{reflection.name}=") do |new_value|
             association = instance_variable_get("@#{reflection.name}")
-            if association.nil?
+            if association.nil? || association.target != new_value
               association = association_proxy_class.new(self, reflection)
             end
 
@@ -926,10 +926,7 @@ def association_accessor_methods(reflection, association_proxy_class)
               instance_variable_set("@#{reflection.name}", association)
             else
               instance_variable_set("@#{reflection.name}", nil)
-              return nil
             end
-
-            association
           end
 
           define_method("set_#{reflection.name}_target") do |target|
diff --git a/activerecord/test/associations_test.rb b/activerecord/test/associations_test.rb
index f1b02cfda5b2c..c2d4db8d1b224 100755
--- a/activerecord/test/associations_test.rb
+++ b/activerecord/test/associations_test.rb
@@ -1007,7 +1007,20 @@ def test_natural_assignment
     citibank.firm = apple
     assert_equal apple.id, citibank.firm_id
   end
-  
+
+  def test_no_unexpected_aliasing
+    first_firm = companies(:first_firm)
+    another_firm = companies(:another_firm)
+
+    citibank = Account.create("credit_limit" => 10)
+    citibank.firm = first_firm
+    original_proxy = citibank.firm
+    citibank.firm = another_firm
+
+    assert_equal first_firm.object_id, original_proxy.object_id
+    assert_equal another_firm.object_id, citibank.firm.object_id
+  end
+
   def test_creating_the_belonging_object
     citibank = Account.create("credit_limit" => 10)
     apple    = citibank.create_firm("name" => "Apple")