diff --git a/TEST b/TEST
index ebe6ef963fa6..a77d4dbdafe6 100644
--- a/TEST
+++ b/TEST
@@ -5,21 +5,21 @@
 #TEST_PREPARE_SHARES="yes"
 
 ### ztest
-#TEST_ZTEST_SKIP="yes"
+TEST_ZTEST_SKIP="yes"
 #TEST_ZTEST_TIMEOUT=1800
 #TEST_ZTEST_DIR="/var/tmp/"
 #TEST_ZTEST_OPTIONS="-V"
 #TEST_ZTEST_CORE_DIR="/mnt/zloop"
 
 ### zimport
-#TEST_ZIMPORT_SKIP="yes"
+TEST_ZIMPORT_SKIP="yes"
 #TEST_ZIMPORT_DIR="/var/tmp/zimport"
 #TEST_ZIMPORT_VERSIONS="master installed"
 #TEST_ZIMPORT_POOLS="zol-0.6.1 zol-0.6.2 master installed"
 #TEST_ZIMPORT_OPTIONS="-c"
 
 ### xfstests
-#TEST_XFSTESTS_SKIP="yes"
+TEST_XFSTESTS_SKIP="yes"
 #TEST_XFSTESTS_URL="https://github.com/behlendorf/xfstests/archive/"
 #TEST_XFSTESTS_VER="zfs.tar.gz"
 #TEST_XFSTESTS_POOL="tank"
@@ -34,11 +34,11 @@
 #TEST_ZFSTESTS_DISKSIZE="8G"
 #TEST_ZFSTESTS_ITERS="1"
 #TEST_ZFSTESTS_OPTIONS="-vx"
-#TEST_ZFSTESTS_RUNFILE="linux.run"
+TEST_ZFSTESTS_RUNFILE="pull-7926.run"
 #TEST_ZFSTESTS_TAGS="functional"
 
 ### zfsstress
-#TEST_ZFSSTRESS_SKIP="yes"
+TEST_ZFSSTRESS_SKIP="yes"
 #TEST_ZFSSTRESS_URL="https://github.com/nedbass/zfsstress/archive/"
 #TEST_ZFSSTRESS_VER="master.tar.gz"
 #TEST_ZFSSTRESS_RUNTIME=300
diff --git a/cmd/zed/agents/zfs_agents.c b/cmd/zed/agents/zfs_agents.c
index 47e251a5e760..fcea4af0926b 100644
--- a/cmd/zed/agents/zfs_agents.c
+++ b/cmd/zed/agents/zfs_agents.c
@@ -57,9 +57,11 @@ typedef struct guid_search {
 	uint64_t	gs_pool_guid;
 	uint64_t	gs_vdev_guid;
 	char		*gs_devid;
+	boolean_t	is_spare;
+	boolean_t	is_l2arc;
 } guid_search_t;
 
-static void
+static boolean_t
 zfs_agent_iter_vdev(zpool_handle_t *zhp, nvlist_t *nvl, void *arg)
 {
 	guid_search_t *gsp = arg;
@@ -73,8 +75,27 @@ zfs_agent_iter_vdev(zpool_handle_t *zhp, nvlist_t *nvl, void *arg)
 	if (nvlist_lookup_nvlist_array(nvl, ZPOOL_CONFIG_CHILDREN,
 	    &child, &children) == 0) {
 		for (c = 0; c < children; c++)
-			zfs_agent_iter_vdev(zhp, child[c], gsp);
-		return;
+			if (zfs_agent_iter_vdev(zhp, child[c], gsp))
+				return (B_TRUE);
+	}
+	/*
+	 * Iterate over any spares and cache devices
+	 */
+	if (nvlist_lookup_nvlist_array(nvl, ZPOOL_CONFIG_SPARES,
+	    &child, &children) == 0) {
+		for (c = 0; c < children; c++)
+			if (zfs_agent_iter_vdev(zhp, child[c], gsp)) {
+				gsp->is_spare = B_TRUE;
+				return (B_TRUE);
+			}
+	}
+	if (nvlist_lookup_nvlist_array(nvl, ZPOOL_CONFIG_L2CACHE,
+	    &child, &children) == 0) {
+		for (c = 0; c < children; c++)
+			if (zfs_agent_iter_vdev(zhp, child[c], gsp)) {
+				gsp->is_l2arc = B_TRUE;
+				return (B_TRUE);
+			}
 	}
 	/*
 	 * On a devid match, grab the vdev guid
@@ -84,7 +105,10 @@ zfs_agent_iter_vdev(zpool_handle_t *zhp, nvlist_t *nvl, void *arg)
 	    (strcmp(gsp->gs_devid, path) == 0)) {
 		(void) nvlist_lookup_uint64(nvl, ZPOOL_CONFIG_GUID,
 		    &gsp->gs_vdev_guid);
+		return (B_TRUE);
 	}
+
+	return (B_FALSE);
 }
 
 static int
@@ -93,13 +117,16 @@ zfs_agent_iter_pool(zpool_handle_t *zhp, void *arg)
 	guid_search_t *gsp = arg;
 	nvlist_t *config, *nvl;
 
+	fprintf(stderr, "zfs_agent_iter_pool: search %lu\n", gsp->gs_vdev_guid);
 	/*
 	 * For each vdev in this pool, look for a match by devid
 	 */
 	if ((config = zpool_get_config(zhp, NULL)) != NULL) {
 		if (nvlist_lookup_nvlist(config, ZPOOL_CONFIG_VDEV_TREE,
 		    &nvl) == 0) {
-			zfs_agent_iter_vdev(zhp, nvl, gsp);
+		    	fprintf(stderr, "zfs_agent_iter_pool: vdev_tree\n");
+		    	nvlist_print(stderr, nvl);
+			(void) zfs_agent_iter_vdev(zhp, nvl, gsp);
 		}
 	}
 	/*
@@ -108,6 +135,9 @@ zfs_agent_iter_pool(zpool_handle_t *zhp, void *arg)
 	if (gsp->gs_vdev_guid) {
 		(void) nvlist_lookup_uint64(config, ZPOOL_CONFIG_POOL_GUID,
 		    &gsp->gs_pool_guid);
+		fprintf(stderr, "zfs_agent_iter_pool: match found for %lu\n", gsp->gs_vdev_guid);
+	} else {
+		fprintf(stderr, "zfs_agent_iter_pool: match not found for %lu\n", gsp->gs_vdev_guid);
 	}
 
 	zpool_close(zhp);
@@ -118,6 +148,7 @@ void
 zfs_agent_post_event(const char *class, const char *subclass, nvlist_t *nvl)
 {
 	agent_event_t *event;
+	boolean_t is_spare = B_FALSE, is_l2arc = B_FALSE;
 
 	if (subclass == NULL)
 		subclass = "";
@@ -157,32 +188,51 @@ zfs_agent_post_event(const char *class, const char *subclass, nvlist_t *nvl)
 		(void) nvlist_lookup_uint64(nvl, ZFS_EV_VDEV_GUID, &vdev_guid);
 
 		/*
-		 * For multipath, ZFS_EV_VDEV_GUID is missing so find it.
+		 * For multipath, spares and L2ARC devices ZFS_EV_VDEV_GUID is
+		 * missing so find it.
 		 */
 		if (vdev_guid == 0) {
 			guid_search_t search = { 0 };
+			int ret = 0;
 
 			(void) nvlist_lookup_string(nvl, DEV_IDENTIFIER,
 			    &search.gs_devid);
+			fprintf(stderr, "zfs_agent_post_event: search by devid=%s\n", search.gs_devid);
 
-			(void) zpool_iter(g_zfs_hdl, zfs_agent_iter_pool,
+			ret = zpool_iter(g_zfs_hdl, zfs_agent_iter_pool,
 			    &search);
+			fprintf(stderr, "zpool_iter: %d\n", ret);
 			pool_guid = search.gs_pool_guid;
 			vdev_guid = search.gs_vdev_guid;
+			is_spare = search.is_spare;
+			is_l2arc = search.is_l2arc;
 		}
 
 		(void) nvlist_add_uint64(payload,
 		    FM_EREPORT_PAYLOAD_ZFS_POOL_GUID, pool_guid);
 		(void) nvlist_add_uint64(payload,
 		    FM_EREPORT_PAYLOAD_ZFS_VDEV_GUID, vdev_guid);
+		if (is_spare)
+			(void) nvlist_add_string(payload,
+			    FM_EREPORT_PAYLOAD_ZFS_VDEV_TYPE, VDEV_TYPE_SPARE);
+		if (is_l2arc)
+			(void) nvlist_add_string(payload,
+			    FM_EREPORT_PAYLOAD_ZFS_VDEV_TYPE,
+			    VDEV_TYPE_L2CACHE);
 
 		(void) gettimeofday(&tv, NULL);
 		tod[0] = tv.tv_sec;
 		tod[1] = tv.tv_usec;
 		(void) nvlist_add_int64_array(payload, FM_EREPORT_TIME, tod, 2);
 
+		fprintf(stderr, "--- being raw udev ---\n");
+		nvlist_print(stderr, nvl);
+		fprintf(stderr, "---  end raw udev  ---\n");
 		zed_log_msg(LOG_INFO, "agent post event: mapping '%s' to '%s'",
 		    EC_DEV_REMOVE, class);
+		fprintf(stderr, "--- being payload ---\n");
+		nvlist_print(stderr, payload);
+		fprintf(stderr, "---  end payload  ---\n");
 	}
 
 	(void) strlcpy(event->ae_class, class, sizeof (event->ae_class));
diff --git a/cmd/zed/agents/zfs_retire.c b/cmd/zed/agents/zfs_retire.c
index 5a090e32f699..a16cc4c297da 100644
--- a/cmd/zed/agents/zfs_retire.c
+++ b/cmd/zed/agents/zfs_retire.c
@@ -126,6 +126,15 @@ find_vdev(libzfs_handle_t *zhdl, nvlist_t *nv, uint64_t search_guid)
 			return (ret);
 	}
 
+	if (nvlist_lookup_nvlist_array(nv, ZPOOL_CONFIG_SPARES,
+	    &child, &children) != 0)
+		return (NULL);
+
+	for (c = 0; c < children; c++) {
+		if ((ret = find_vdev(zhdl, child[c], search_guid)) != NULL)
+			return (ret);
+	}
+
 	return (NULL);
 }
 
@@ -308,6 +317,8 @@ zfs_retire_recv(fmd_hdl_t *hdl, fmd_event_t *ep, nvlist_t *nvl,
 	 * check for an available spare and continue.
 	 */
 	if (strcmp(class, "resource.fs.zfs.removed") == 0) {
+		char *type;
+
 		if (nvlist_lookup_uint64(nvl, FM_EREPORT_PAYLOAD_ZFS_POOL_GUID,
 		    &pool_guid) != 0 ||
 		    nvlist_lookup_uint64(nvl, FM_EREPORT_PAYLOAD_ZFS_VDEV_GUID,
@@ -318,6 +329,32 @@ zfs_retire_recv(fmd_hdl_t *hdl, fmd_event_t *ep, nvlist_t *nvl,
 		    &vdev)) == NULL)
 			return;
 
+		/* Can't replace a spare with another one: offline the device */
+		if (nvlist_lookup_string(nvl, FM_EREPORT_PAYLOAD_ZFS_VDEV_TYPE,
+		    &type) == 0 && strcmp(type, VDEV_TYPE_SPARE) == 0) {
+			char *dev_name;
+
+			dev_name = zpool_vdev_name(NULL, zhp, vdev, B_FALSE);
+			fmd_hdl_debug(hdl, "zpool_vdev_offline '%s'", dev_name);
+			zpool_vdev_offline(zhp, dev_name, B_TRUE);
+			free(dev_name);
+			zpool_close(zhp);
+			return;
+		}
+
+		/* Can't replace a l2arc with a spare: offline the device */
+		if (nvlist_lookup_string(nvl, FM_EREPORT_PAYLOAD_ZFS_VDEV_TYPE,
+		    &type) == 0 && strcmp(type, VDEV_TYPE_L2CACHE) == 0) {
+			char *dev_name;
+
+			dev_name = zpool_vdev_name(NULL, zhp, vdev, B_FALSE);
+			fmd_hdl_debug(hdl, "zpool_vdev_offline '%s'", dev_name);
+			zpool_vdev_offline(zhp, dev_name, B_TRUE);
+			free(dev_name);
+			zpool_close(zhp);
+			return;
+		}
+
 		if (fmd_prop_get_int32(hdl, "spare_on_remove"))
 			replace_with_spare(hdl, zhp, vdev);
 		zpool_close(zhp);
diff --git a/lib/libzfs/libzfs_config.c b/lib/libzfs/libzfs_config.c
index 67379d07211a..fa8ed8c61331 100644
--- a/lib/libzfs/libzfs_config.c
+++ b/lib/libzfs/libzfs_config.c
@@ -399,7 +399,7 @@ zpool_iter(libzfs_handle_t *hdl, zpool_iter_f func, void *data)
 	 * namespace AVL tree.
 	 */
 	if (!hdl->libzfs_pool_iter && namespace_reload(hdl) != 0)
-		return (-1);
+		return (-2);
 
 	hdl->libzfs_pool_iter++;
 	for (cn = uu_avl_first(hdl->libzfs_ns_avl); cn != NULL;
diff --git a/module/zfs/vdev_disk.c b/module/zfs/vdev_disk.c
index a4109543dfc3..71d900b9c183 100644
--- a/module/zfs/vdev_disk.c
+++ b/module/zfs/vdev_disk.c
@@ -803,8 +803,10 @@ vdev_disk_io_done(zio_t *zio)
 	if (zio->io_error == EIO) {
 		vdev_t *v = zio->io_vd;
 		vdev_disk_t *vd = v->vdev_tsd;
-
-		if (check_disk_change(vd->vd_bdev)) {
+		int ret = check_disk_change(vd->vd_bdev);
+		zfs_dbgmsg("check_disk_change(%s) = %d",
+		    vd->vd_bdev->bd_disk->disk_name, ret);
+		if (ret) {
 			vdev_bdev_invalidate(vd->vd_bdev);
 			v->vdev_remove_wanted = B_TRUE;
 			spa_async_request(zio->io_spa, SPA_ASYNC_REMOVE);
diff --git a/tests/runfiles/linux.run b/tests/runfiles/linux.run
index 4b41c3f743ca..19931b2f1e63 100644
--- a/tests/runfiles/linux.run
+++ b/tests/runfiles/linux.run
@@ -536,9 +536,10 @@ tests = ['exec_001_pos', 'exec_002_neg']
 tags = ['functional', 'exec']
 
 [tests/functional/fault]
-tests = ['auto_online_001_pos', 'auto_replace_001_pos', 'auto_spare_001_pos',
-    'auto_spare_002_pos', 'auto_spare_ashift', 'auto_spare_multiple',
-    'scrub_after_resilver', 'decrypt_fault', 'decompress_fault']
+tests = ['auto_offline_001_pos', 'auto_online_001_pos', 'auto_replace_001_pos',
+    'auto_spare_001_pos', 'auto_spare_002_pos', 'auto_spare_ashift',
+    'auto_spare_multiple', 'scrub_after_resilver', 'decrypt_fault',
+    'decompress_fault']
 tags = ['functional', 'fault']
 
 [tests/functional/features/async_destroy]
diff --git a/tests/runfiles/pull-7926.run b/tests/runfiles/pull-7926.run
new file mode 100644
index 000000000000..9a6e44894fd1
--- /dev/null
+++ b/tests/runfiles/pull-7926.run
@@ -0,0 +1,16 @@
+[DEFAULT]
+pre = setup
+quiet = False
+pre_user = root
+user = root
+timeout = 600
+post_user = root
+post = cleanup
+outputdir = /var/tmp/test_results
+
+[tests/functional/fault]
+tests = ['auto_offline_001_pos', 'auto_offline_001_pos', 'auto_offline_001_pos',
+    'auto_offline_001_pos', 'auto_offline_001_pos', 'auto_offline_001_pos',
+    'auto_offline_001_pos', 'auto_offline_001_pos', 'auto_offline_001_pos']
+tags = ['functional']
+
diff --git a/tests/zfs-tests/tests/functional/fault/Makefile.am b/tests/zfs-tests/tests/functional/fault/Makefile.am
index 285e331a1a1d..a4f51181e335 100644
--- a/tests/zfs-tests/tests/functional/fault/Makefile.am
+++ b/tests/zfs-tests/tests/functional/fault/Makefile.am
@@ -2,6 +2,7 @@ pkgdatadir = $(datadir)/@PACKAGE@/zfs-tests/tests/functional/fault
 dist_pkgdata_SCRIPTS = \
 	setup.ksh \
 	cleanup.ksh \
+	auto_offline_001_pos.ksh \
 	auto_online_001_pos.ksh \
 	auto_replace_001_pos.ksh \
 	auto_spare_001_pos.ksh \
diff --git a/tests/zfs-tests/tests/functional/fault/auto_offline_001_pos.ksh b/tests/zfs-tests/tests/functional/fault/auto_offline_001_pos.ksh
new file mode 100755
index 000000000000..372368b2ac36
--- /dev/null
+++ b/tests/zfs-tests/tests/functional/fault/auto_offline_001_pos.ksh
@@ -0,0 +1,77 @@
+#!/bin/ksh -p
+#
+# CDDL HEADER START
+#
+# This file and its contents are supplied under the terms of the
+# Common Development and Distribution License ("CDDL"), version 1.0.
+# You may only use this file in accordance with the terms of version
+# 1.0 of the CDDL.
+#
+# A full copy of the text of the CDDL should have accompanied this
+# source.  A copy of the CDDL is also available via the Internet at
+# http://www.illumos.org/license/CDDL.
+#
+# CDDL HEADER END
+#
+
+#
+# Copyright (c) 2017 by Intel Corporation. All rights reserved.
+# Copyright 2018, loli10K <ezomori.nozomu@gmail.com>. All rights reserved.
+#
+
+. $STF_SUITE/include/libtest.shlib
+. $STF_SUITE/tests/functional/fault/fault.cfg
+
+#
+# DESCRIPTION:
+# Testing Fault Management Agent ZED Logic - Physically removed L2ARC device
+# is offlined
+#
+# STRATEGY:
+# 1. Create a pool with a L2ARC device
+# 2. Simulate physical removal of L2ARC device
+# 3. Verify the device is offlined
+#
+verify_runnable "both"
+
+if is_linux; then
+	load_scsi_debug $SDSIZE $SDHOSTS $SDTGTS $SDLUNS '512b'
+else
+	log_unsupported "scsi debug module unsupported"
+fi
+
+function cleanup
+{
+	destroy_pool $TESTPOOL
+	rm -f $FILE_DEVICE
+	unload_scsi_debug
+}
+
+log_assert "ZED detects physically removed L2ARC device"
+
+log_onexit cleanup
+
+FILE_DEVICE="$TEST_BASE_DIR/file-vdev"
+L2ARC_DEVICE=$(get_debug_device)
+
+# 1. Create a pool with a L2ARC device
+truncate -s $SPA_MINDEVSIZE $FILE_DEVICE
+log_must zpool create $TESTPOOL $FILE_DEVICE cache $L2ARC_DEVICE
+
+# 2. Simulate physical removal of L2ARC device
+remove_disk $L2ARC_DEVICE
+
+# 3. Verify the device is offlined
+#log_must wait_vdev_state $TESTPOOL $L2ARC_DEVICE "OFFLINE"
+wait_vdev_state $TESTPOOL $L2ARC_DEVICE "OFFLINE"
+ret=$?
+if [[ $ret != 0 ]]; then
+	zpool status
+	zpool status -g
+	zpool status -LP
+	cat $ZED_LOG
+	truncate -s 0 $ZED_LOG
+	log_fail ""
+fi
+
+log_pass "ZED detects physically removed L2ARC device"