diff --git a/crates/nu-plugin/src/plugin/interface/stream.rs b/crates/nu-plugin/src/plugin/interface/stream.rs
index 6cda6df8d..95268cb9e 100644
--- a/crates/nu-plugin/src/plugin/interface/stream.rs
+++ b/crates/nu-plugin/src/plugin/interface/stream.rs
@@ -113,8 +113,14 @@ where
 
     fn next(&mut self) -> Option<T> {
         // Converting the error to the value here makes the implementation a lot easier
-        self.recv()
-            .unwrap_or_else(|err| Some(T::from_shell_error(err)))
+        match self.recv() {
+            Ok(option) => option,
+            Err(err) => {
+                // Drop the receiver so we don't keep returning errors
+                self.receiver = None;
+                Some(T::from_shell_error(err))
+            }
+        }
     }
 }
 
diff --git a/crates/nu-plugin/src/plugin/interface/stream/tests.rs b/crates/nu-plugin/src/plugin/interface/stream/tests.rs
index 6acf95bea..a775fd3ba 100644
--- a/crates/nu-plugin/src/plugin/interface/stream/tests.rs
+++ b/crates/nu-plugin/src/plugin/interface/stream/tests.rs
@@ -147,6 +147,21 @@ fn reader_recv_end_of_stream() -> Result<(), ShellError> {
     Ok(())
 }
 
+#[test]
+fn reader_iter_fuse_on_error() -> Result<(), ShellError> {
+    let (tx, rx) = mpsc::channel();
+    let mut reader = StreamReader::<Value, _>::new(0, rx, TestSink::default());
+
+    drop(tx); // should cause error, because we didn't explicitly signal the end
+
+    assert!(
+        reader.next().is_some_and(|e| e.is_error()),
+        "should be error the first time"
+    );
+    assert!(reader.next().is_none(), "should be closed the second time");
+    Ok(())
+}
+
 #[test]
 fn reader_drop() {
     let (_tx, rx) = mpsc::channel();