diff --git a/NEWS b/NEWS
index c625356c7..4c3a1caa3 100644
--- a/NEWS
+++ b/NEWS
@@ -14,6 +14,8 @@ Any uppercase BUG_* names are modernish shell bug IDs.
   turned on if ksh is invoked under the name 'sh'.
   For now, it:
   * disables the &> redirection shorthand
+  * causes the 'let' arithmetic command to recognise octal numbers by
+    leading zeros regardless of the setting of the 'letoctal' option
 
 2020-08-19:
 
diff --git a/src/cmd/ksh93/sh.1 b/src/cmd/ksh93/sh.1
index e8648b3fa..a45891ca6 100644
--- a/src/cmd/ksh93/sh.1
+++ b/src/cmd/ksh93/sh.1
@@ -6321,10 +6321,12 @@ to be evaluated.
 .B let
 only recognizes octal constants starting with
 .B 0
-when the
+if one of the
 .B set
-option
+options
 .B letoctal
+or
+.B posix
 is on.
 See
 .I "Arithmetic Evaluation"
@@ -6987,6 +6989,8 @@ The
 .B let
 command allows octal constants starting with
 .BR 0 .
+If the \fBposix\fR shell option is active,
+octals are recognized regardless of this option.
 .TP 8
 .B markdirs
 All directory names resulting from file name generation have a trailing
@@ -7034,6 +7038,7 @@ to fail or zero if no command has failed.
 .B posix
 Enable POSIX standard compatibility mode. This option
 is on by default if ksh is invoked as \fBsh\fR. It
+enables octal numbers in \fBlet\fR shell arithmetic (see \fBletoctal\fR), and
 disables the \fB&>\fR redirection shorthand.
 .TP 8
 .B privileged
diff --git a/src/cmd/ksh93/sh/arith.c b/src/cmd/ksh93/sh/arith.c
index 2cd406fe0..9ca43f0d3 100644
--- a/src/cmd/ksh93/sh/arith.c
+++ b/src/cmd/ksh93/sh/arith.c
@@ -390,8 +390,11 @@ static Sfdouble_t arith(const char **ptr, struct lval *lvalue, int type, Sfdoubl
 			char	lastbase=0, *val = xp, oerrno = errno;
 			lvalue->eflag = 0;
 			errno = 0;
-			if(shp->bltindata.bnode==SYSLET && !sh_isoption(SH_LETOCTAL))
-			{
+			if(shp->bltindata.bnode==SYSLET && !sh_isoption(SH_LETOCTAL) && !sh_isoption(SH_POSIX))
+			{	/*
+				 * Since we're running the "let" builtin, disable octal number processing by
+				 * skipping all initial zeros, unless the 'letoctal' or 'posix' option is on.
+				 */
 				while(*val=='0' && isdigit(val[1]))
 					val++;
 			}
@@ -415,8 +418,7 @@ static Sfdouble_t arith(const char **ptr, struct lval *lvalue, int type, Sfdoubl
 				c='e';
 			else
 				c = *str;
-			if(c==GETDECIMAL(0) || c=='e' || c == 'E' || lastbase ==
- 16 && (c == 'p' || c == 'P'))
+			if(c==GETDECIMAL(0) || c=='e' || c == 'E' || lastbase == 16 && (c == 'p' || c == 'P'))
 			{
 				lvalue->isfloat=1;
 				r = strtold(val,&str);
diff --git a/src/cmd/ksh93/tests/arith.sh b/src/cmd/ksh93/tests/arith.sh
index bfa6f68f8..7327eaffd 100755
--- a/src/cmd/ksh93/tests/arith.sh
+++ b/src/cmd/ksh93/tests/arith.sh
@@ -680,9 +680,8 @@ exp='typeset -C -a x=((typeset -C -a y=( [0]=(typeset -a -l -i z=([2]=3);));))'
 unset x
 let x=010
 [[ $x == 10 ]] || err_exit 'let treating 010 as octal'
-set -o letoctal
-let x=010
-[[ $x == 8 ]] || err_exit 'let not treating 010 as octal with letoctal on'
+(set -o letoctal; let x=010; [[ $x == 8 ]]) || err_exit 'let not treating 010 as octal with letoctal on'
+(set -o posix 2>/dev/null; let x=010; [[ $x == 8 ]]) || err_exit 'let not treating 010 as octal with posix on'
 
 float z=0
 integer aa=2 a=1
diff --git a/src/cmd/ksh93/tests/shtests b/src/cmd/ksh93/tests/shtests
index b5d413b2d..3fa9dbfae 100755
--- a/src/cmd/ksh93/tests/shtests
+++ b/src/cmd/ksh93/tests/shtests
@@ -166,7 +166,8 @@ function valxml
 	return $errors
 }
 
-unset DISPLAY FIGNORE HISTFILE
+command set +o posix 2>/dev/null
+unset DISPLAY FIGNORE HISTFILE POSIXLY_CORRECT _AST_FEATURES
 export ENV=/./dev/null
 trap + PIPE # unadvertized -- set SIGPIPE to SIG_DFL #