diff --git a/lisp/org-src.el b/lisp/org-src.el
index 582402148..f2091ef01 100644
--- a/lisp/org-src.el
+++ b/lisp/org-src.el
@@ -737,10 +737,8 @@ with \",*\", \",#+\", \",,*\" and \",,#+\"."
       (unless (or single preserve-indentation (= total-nindent 0))
 	(setq indent (make-string total-nindent ?\ ))
 	(goto-char (point-min))
-        (while (and (not (eobp)) (re-search-forward "^" nil t))
-          (if (not (looking-at "$"))
-              (replace-match indent)
-	    (forward-char 1))))
+	(while (re-search-forward "\\(^\\).+" nil t)
+	  (replace-match indent nil nil nil 1)))
       (if (org-bound-and-true-p org-edit-src-picture)
 	  (setq total-nindent (+ total-nindent 2)))
       (setq code (buffer-string))