diff --git a/handler-proxy/src/main/java/io/netty/handler/proxy/HttpProxyHandler.java b/handler-proxy/src/main/java/io/netty/handler/proxy/HttpProxyHandler.java
index 55e450c0ed..527d238c3c 100644
--- a/handler-proxy/src/main/java/io/netty/handler/proxy/HttpProxyHandler.java
+++ b/handler-proxy/src/main/java/io/netty/handler/proxy/HttpProxyHandler.java
@@ -68,7 +68,7 @@ public final class HttpProxyHandler extends ProxyHandler {
         ByteBuf authz = Unpooled.copiedBuffer(username + ':' + password, CharsetUtil.UTF_8);
         ByteBuf authzBase64 = Base64.encode(authz, false);
 
-        authorization = new AsciiString(authzBase64.toString(CharsetUtil.US_ASCII));
+        authorization = new AsciiString("Basic " + authzBase64.toString(CharsetUtil.US_ASCII));
 
         authz.release();
         authzBase64.release();
@@ -131,7 +131,7 @@ public final class HttpProxyHandler extends ProxyHandler {
         }
 
         if (authorization != null) {
-            req.headers().set(HttpHeaderNames.AUTHORIZATION, authorization);
+            req.headers().set(HttpHeaderNames.PROXY_AUTHORIZATION, authorization);
         }
 
         return req;
diff --git a/handler-proxy/src/test/java/io/netty/handler/proxy/HttpProxyServer.java b/handler-proxy/src/test/java/io/netty/handler/proxy/HttpProxyServer.java
index 6097f75d39..69071ffdf1 100644
--- a/handler-proxy/src/test/java/io/netty/handler/proxy/HttpProxyServer.java
+++ b/handler-proxy/src/test/java/io/netty/handler/proxy/HttpProxyServer.java
@@ -35,6 +35,7 @@ import io.netty.handler.codec.http.HttpResponseStatus;
 import io.netty.handler.codec.http.HttpServerCodec;
 import io.netty.handler.codec.http.HttpVersion;
 import io.netty.util.CharsetUtil;
+import io.netty.util.internal.StringUtil;
 
 import java.net.InetSocketAddress;
 import java.net.SocketAddress;
@@ -86,15 +87,18 @@ final class HttpProxyServer extends ProxyServer {
 
         boolean authzSuccess = false;
         if (username != null) {
-            CharSequence authz = req.headers().get(HttpHeaderNames.AUTHORIZATION);
+            CharSequence authz = req.headers().get(HttpHeaderNames.PROXY_AUTHORIZATION);
             if (authz != null) {
-                ByteBuf authzBuf64 = Unpooled.copiedBuffer(authz, CharsetUtil.US_ASCII);
+                String[] authzParts = StringUtil.split(authz.toString(), ' ', 2);
+                ByteBuf authzBuf64 = Unpooled.copiedBuffer(authzParts[1], CharsetUtil.US_ASCII);
                 ByteBuf authzBuf = Base64.decode(authzBuf64);
-                authz = authzBuf.toString(CharsetUtil.US_ASCII);
+
+                String expectedAuthz = username + ':' + password;
+                authzSuccess = "Basic".equals(authzParts[0]) &&
+                               expectedAuthz.equals(authzBuf.toString(CharsetUtil.US_ASCII));
+
                 authzBuf64.release();
                 authzBuf.release();
-                String expectedAuthz = username + ':' + password;
-                authzSuccess = expectedAuthz.equals(authz);
             }
         } else {
             authzSuccess = true;