diff --git a/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button-debug.js b/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button-debug.js
index bfac56eb2c351..72008e298996d 100644
--- a/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button-debug.js
+++ b/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button-debug.js
@@ -71,6 +71,9 @@ Y.namespace('M.atto_indent').Button = Y.Base.create('button', Y.M.editor_atto.Ed
         // Run the indent command.
         document.execCommand('indent', false, null);
 
+        // Fix indent list item.
+        this.fixupListItemsAfterIndent();
+
         // Get all blockquotes, both existing and new.
         blockquotes = this.editor.all('blockquote');
 
@@ -195,6 +198,28 @@ Y.namespace('M.atto_indent').Button = Y.Base.create('button', Y.M.editor_atto.Ed
             indent.replace(clone);
             indent = editor.one('.editor-indent');
         }
+    },
+    /**
+     * Fixup for list item after indent.
+     *
+     * @method fixupListItemsAfterIndent
+     */
+    fixupListItemsAfterIndent: function() {
+        var selection = window.rangy.getSelection(),
+            rootelement = this.editor.getDOMNode(),
+            listelement = selection.anchorNode.parentElement;
+
+        listelement = listelement.closest('ol, ul');
+        if (!(listelement && rootelement.contains(listelement))) {
+            return;
+        }
+
+        // We will move the child list into previous list item of the parent.
+        var previous = listelement.previousElementSibling;
+        if (previous && previous.tagName === 'LI') {
+            previous.appendChild(listelement);
+            selection.collapseToEnd();
+        }
     }
 });
 
diff --git a/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button-min.js b/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button-min.js
index 239e77ac77f5a..0e1f34cdf4daa 100644
--- a/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button-min.js
+++ b/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button-min.js
@@ -1 +1 @@
-YUI.add("moodle-atto_indent-button",function(r,e){r.namespace("M.atto_indent").Button=r.Base.create("button",r.M.editor_atto.EditorPlugin,[],{initializer:function(){this.addButton({icon:"e/decrease_indent",title:"outdent",buttonName:"outdent",callback:this.outdent}),this.addButton({icon:"e/increase_indent",title:"indent",buttonName:"indent",callback:this.indent})},indent:function(){var e=window.rangy.saveSelection(),t=this.editor.all("blockquote"),o=t.size();this.editor.all(".rangySelectionBoundary").setStyle("display",null),t.addClass("pre-existing"),document.execCommand("indent",!1,null),(t=this.editor.all("blockquote")).size()!==o?(this.replaceBlockquote(this.editor),window.rangy.restoreSelection(e)):0<t.size()&&t.removeClass("pre-existing"),window.rangy.removeMarkers(e),this.markUpdated()},outdent:function(){var e=window.rangy.saveSelection(),t=this.editor.all("blockquote"),o=t.size();t.addClass("pre-existing"),this.replaceEditorIndents(this.editor),window.rangy.restoreSelection(e),e=window.rangy.saveSelection(),document.execCommand("outdent",!1,null),(t=this.editor.all("blockquote")).size()!==o?(this.replaceBlockquote(this.editor),window.rangy.restoreSelection(e)):0<t.size()&&t.removeClass("pre-existing"),window.rangy.removeMarkers(e),this.markUpdated()},replaceBlockquote:function(e){var t,o,i,n,d;for(e.all("blockquote").setAttribute("data-iterate",!0),t=e.one("blockquote"),o=r.one("body.dir-ltr")?"marginLeft":"marginRight";t;){if(t.removeAttribute("data-iterate"),t.hasClass("pre-existing"))t.removeClass("pre-existing");else{for(i=r.Node.create("<div></div>").setAttrs(t.getAttrs()).setStyle(o,"30px").addClass("editor-indent"),d=(n=t.getDOMNode().childNodes)[0];void 0!==d;)i.append(d),d=n[0];t.replace(i)}t=e.one("blockquote[data-iterate]")}},replaceEditorIndents:function(e){for(var t,o,i,n=e.one(".editor-indent");n;){for(t=r.Node.create("<blockquote></blockquote>").setAttrs(n.getAttrs()).removeClass("editor-indent"),i=(o=n.getDOMNode().childNodes)[0];void 0!==i;)t.append(i),i=o[0];n.replace(t),n=e.one(".editor-indent")}}})},"@VERSION@",{requires:["moodle-editor_atto-plugin"]});
\ No newline at end of file
+YUI.add("moodle-atto_indent-button",function(r,e){r.namespace("M.atto_indent").Button=r.Base.create("button",r.M.editor_atto.EditorPlugin,[],{initializer:function(){this.addButton({icon:"e/decrease_indent",title:"outdent",buttonName:"outdent",callback:this.outdent}),this.addButton({icon:"e/increase_indent",title:"indent",buttonName:"indent",callback:this.indent})},indent:function(){var e=window.rangy.saveSelection(),t=this.editor.all("blockquote"),i=t.size();this.editor.all(".rangySelectionBoundary").setStyle("display",null),t.addClass("pre-existing"),document.execCommand("indent",!1,null),this.fixupListItemsAfterIndent(),(t=this.editor.all("blockquote")).size()!==i?(this.replaceBlockquote(this.editor),window.rangy.restoreSelection(e)):0<t.size()&&t.removeClass("pre-existing"),window.rangy.removeMarkers(e),this.markUpdated()},outdent:function(){var e=window.rangy.saveSelection(),t=this.editor.all("blockquote"),i=t.size();t.addClass("pre-existing"),this.replaceEditorIndents(this.editor),window.rangy.restoreSelection(e),e=window.rangy.saveSelection(),document.execCommand("outdent",!1,null),(t=this.editor.all("blockquote")).size()!==i?(this.replaceBlockquote(this.editor),window.rangy.restoreSelection(e)):0<t.size()&&t.removeClass("pre-existing"),window.rangy.removeMarkers(e),this.markUpdated()},replaceBlockquote:function(e){var t,i,o,n,d;for(e.all("blockquote").setAttribute("data-iterate",!0),t=e.one("blockquote"),i=r.one("body.dir-ltr")?"marginLeft":"marginRight";t;){if(t.removeAttribute("data-iterate"),t.hasClass("pre-existing"))t.removeClass("pre-existing");else{for(o=r.Node.create("<div></div>").setAttrs(t.getAttrs()).setStyle(i,"30px").addClass("editor-indent"),d=(n=t.getDOMNode().childNodes)[0];void 0!==d;)o.append(d),d=n[0];t.replace(o)}t=e.one("blockquote[data-iterate]")}},replaceEditorIndents:function(e){for(var t,i,o,n=e.one(".editor-indent");n;){for(t=r.Node.create("<blockquote></blockquote>").setAttrs(n.getAttrs()).removeClass("editor-indent"),o=(i=n.getDOMNode().childNodes)[0];void 0!==o;)t.append(o),o=i[0];n.replace(t),n=e.one(".editor-indent")}},fixupListItemsAfterIndent:function(){var e,t=window.rangy.getSelection(),i=this.editor.getDOMNode(),o=t.anchorNode.parentElement;(o=o.closest("ol, ul"))&&i.contains(o)&&(e=o.previousElementSibling)&&"LI"===e.tagName&&(e.appendChild(o),t.collapseToEnd())}})},"@VERSION@",{requires:["moodle-editor_atto-plugin"]});
\ No newline at end of file
diff --git a/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button.js b/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button.js
index bfac56eb2c351..72008e298996d 100644
--- a/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button.js
+++ b/lib/editor/atto/plugins/indent/yui/build/moodle-atto_indent-button/moodle-atto_indent-button.js
@@ -71,6 +71,9 @@ Y.namespace('M.atto_indent').Button = Y.Base.create('button', Y.M.editor_atto.Ed
         // Run the indent command.
         document.execCommand('indent', false, null);
 
+        // Fix indent list item.
+        this.fixupListItemsAfterIndent();
+
         // Get all blockquotes, both existing and new.
         blockquotes = this.editor.all('blockquote');
 
@@ -195,6 +198,28 @@ Y.namespace('M.atto_indent').Button = Y.Base.create('button', Y.M.editor_atto.Ed
             indent.replace(clone);
             indent = editor.one('.editor-indent');
         }
+    },
+    /**
+     * Fixup for list item after indent.
+     *
+     * @method fixupListItemsAfterIndent
+     */
+    fixupListItemsAfterIndent: function() {
+        var selection = window.rangy.getSelection(),
+            rootelement = this.editor.getDOMNode(),
+            listelement = selection.anchorNode.parentElement;
+
+        listelement = listelement.closest('ol, ul');
+        if (!(listelement && rootelement.contains(listelement))) {
+            return;
+        }
+
+        // We will move the child list into previous list item of the parent.
+        var previous = listelement.previousElementSibling;
+        if (previous && previous.tagName === 'LI') {
+            previous.appendChild(listelement);
+            selection.collapseToEnd();
+        }
     }
 });
 
diff --git a/lib/editor/atto/plugins/indent/yui/src/button/js/button.js b/lib/editor/atto/plugins/indent/yui/src/button/js/button.js
index bc37415828bdc..d309ff5f78ace 100644
--- a/lib/editor/atto/plugins/indent/yui/src/button/js/button.js
+++ b/lib/editor/atto/plugins/indent/yui/src/button/js/button.js
@@ -69,6 +69,9 @@ Y.namespace('M.atto_indent').Button = Y.Base.create('button', Y.M.editor_atto.Ed
         // Run the indent command.
         document.execCommand('indent', false, null);
 
+        // Fix indent list item.
+        this.fixupListItemsAfterIndent();
+
         // Get all blockquotes, both existing and new.
         blockquotes = this.editor.all('blockquote');
 
@@ -193,5 +196,27 @@ Y.namespace('M.atto_indent').Button = Y.Base.create('button', Y.M.editor_atto.Ed
             indent.replace(clone);
             indent = editor.one('.editor-indent');
         }
+    },
+    /**
+     * Fixup for list item after indent.
+     *
+     * @method fixupListItemsAfterIndent
+     */
+    fixupListItemsAfterIndent: function() {
+        var selection = window.rangy.getSelection(),
+            rootelement = this.editor.getDOMNode(),
+            listelement = selection.anchorNode.parentElement;
+
+        listelement = listelement.closest('ol, ul');
+        if (!(listelement && rootelement.contains(listelement))) {
+            return;
+        }
+
+        // We will move the child list into previous list item of the parent.
+        var previous = listelement.previousElementSibling;
+        if (previous && previous.tagName === 'LI') {
+            previous.appendChild(listelement);
+            selection.collapseToEnd();
+        }
     }
 });