diff --git a/src/test/txpackage_tests.cpp b/src/test/txpackage_tests.cpp
index 55e0c5f2859..6d7654a6271 100644
--- a/src/test/txpackage_tests.cpp
+++ b/src/test/txpackage_tests.cpp
@@ -6,6 +6,7 @@
 #include <key_io.h>
 #include <policy/packages.h>
 #include <policy/policy.h>
+#include <policy/rbf.h>
 #include <primitives/transaction.h>
 #include <script/script.h>
 #include <serialize.h>
@@ -938,4 +939,147 @@ BOOST_FIXTURE_TEST_CASE(package_cpfp_tests, TestChain100Setup)
         BOOST_CHECK_EQUAL(m_node.mempool->size(), expected_pool_size);
     }
 }
+
+BOOST_FIXTURE_TEST_CASE(package_rbf_tests, TestChain100Setup)
+{
+    mineBlocks(5);
+    LOCK(::cs_main);
+    size_t expected_pool_size = m_node.mempool->size();
+    CKey child_key{GenerateRandomKey()};
+    CScript parent_spk = GetScriptForDestination(WitnessV0KeyHash(child_key.GetPubKey()));
+    CKey grandchild_key{GenerateRandomKey()};
+    CScript child_spk = GetScriptForDestination(WitnessV0KeyHash(grandchild_key.GetPubKey()));
+
+    const CAmount coinbase_value{50 * COIN};
+    // Test that de-duplication works. This is not actually package rbf.
+    {
+        // 1 parent paying 200sat, 1 child paying 300sat
+        Package package1;
+        // 1 parent paying 200sat, 1 child paying 500sat
+        Package package2;
+        // Package1 and package2 have the same parent. The children conflict.
+        auto mtx_parent = CreateValidMempoolTransaction(/*input_transaction=*/m_coinbase_txns[0], /*input_vout=*/0,
+                                                        /*input_height=*/0, /*input_signing_key=*/coinbaseKey,
+                                                        /*output_destination=*/parent_spk,
+                                                        /*output_amount=*/coinbase_value - low_fee_amt, /*submit=*/false);
+        CTransactionRef tx_parent = MakeTransactionRef(mtx_parent);
+        package1.push_back(tx_parent);
+        package2.push_back(tx_parent);
+
+        CTransactionRef tx_child_1 = MakeTransactionRef(CreateValidMempoolTransaction(tx_parent, 0, 101, child_key, child_spk, coinbase_value - low_fee_amt - 300, false));
+        package1.push_back(tx_child_1);
+        CTransactionRef tx_child_2 = MakeTransactionRef(CreateValidMempoolTransaction(tx_parent, 0, 101, child_key, child_spk, coinbase_value - low_fee_amt - 500, false));
+        package2.push_back(tx_child_2);
+
+        LOCK(m_node.mempool->cs);
+        const auto submit1 = ProcessNewPackage(m_node.chainman->ActiveChainstate(), *m_node.mempool, package1, /*test_accept=*/false, std::nullopt);
+        if (auto err_1{CheckPackageMempoolAcceptResult(package1, submit1, /*expect_valid=*/true, m_node.mempool.get())}) {
+            BOOST_ERROR(err_1.value());
+        }
+
+        // Check precise ResultTypes and mempool size. We know it_parent_1 and it_child_1 exist from above call
+        auto it_parent_1 = submit1.m_tx_results.find(tx_parent->GetWitnessHash());
+        auto it_child_1 = submit1.m_tx_results.find(tx_child_1->GetWitnessHash());
+        BOOST_CHECK_EQUAL(it_parent_1->second.m_result_type, MempoolAcceptResult::ResultType::VALID);
+        BOOST_CHECK_EQUAL(it_child_1->second.m_result_type, MempoolAcceptResult::ResultType::VALID);
+        expected_pool_size += 2;
+        BOOST_CHECK_EQUAL(m_node.mempool->size(), expected_pool_size);
+
+        const auto submit2 = ProcessNewPackage(m_node.chainman->ActiveChainstate(), *m_node.mempool, package2, /*test_accept=*/false, std::nullopt);
+        if (auto err_2{CheckPackageMempoolAcceptResult(package2, submit2, /*expect_valid=*/true, m_node.mempool.get())}) {
+            BOOST_ERROR(err_2.value());
+        }
+
+        // Check precise ResultTypes and mempool size. We know it_parent_2 and it_child_2 exist from above call
+        auto it_parent_2 = submit2.m_tx_results.find(tx_parent->GetWitnessHash());
+        auto it_child_2 = submit2.m_tx_results.find(tx_child_2->GetWitnessHash());
+        BOOST_CHECK_EQUAL(it_parent_2->second.m_result_type, MempoolAcceptResult::ResultType::MEMPOOL_ENTRY);
+        BOOST_CHECK_EQUAL(it_child_2->second.m_result_type, MempoolAcceptResult::ResultType::VALID);
+        BOOST_CHECK_EQUAL(m_node.mempool->size(), expected_pool_size);
+
+        // child1 has been replaced
+        BOOST_CHECK(!m_node.mempool->exists(GenTxid::Txid(tx_child_1->GetHash())));
+    }
+
+    // Test package rbf.
+    {
+        CTransactionRef tx_parent_1 = MakeTransactionRef(CreateValidMempoolTransaction(
+            m_coinbase_txns[1], /*input_vout=*/0, /*input_height=*/0,
+            coinbaseKey, parent_spk, coinbase_value - 200, /*submit=*/false));
+        CTransactionRef tx_child_1 = MakeTransactionRef(CreateValidMempoolTransaction(
+            tx_parent_1, /*input_vout=*/0, /*input_height=*/101,
+            child_key, child_spk, coinbase_value - 400, /*submit=*/false));
+
+        CTransactionRef tx_parent_2 = MakeTransactionRef(CreateValidMempoolTransaction(
+            m_coinbase_txns[1], /*input_vout=*/0, /*input_height=*/0,
+            coinbaseKey, parent_spk, coinbase_value - 800, /*submit=*/false));
+        CTransactionRef tx_child_2 = MakeTransactionRef(CreateValidMempoolTransaction(
+            tx_parent_2, /*input_vout=*/0, /*input_height=*/101,
+            child_key, child_spk, coinbase_value - 800 - 200, /*submit=*/false));
+
+        CTransactionRef tx_parent_3 = MakeTransactionRef(CreateValidMempoolTransaction(
+            m_coinbase_txns[1], /*input_vout=*/0, /*input_height=*/0,
+            coinbaseKey, parent_spk, coinbase_value - 199, /*submit=*/false));
+        CTransactionRef tx_child_3 = MakeTransactionRef(CreateValidMempoolTransaction(
+            tx_parent_3, /*input_vout=*/0, /*input_height=*/101,
+            child_key, child_spk, coinbase_value - 199 - 1300, /*submit=*/false));
+
+        // In all packages, the parents conflict with each other
+        BOOST_CHECK(tx_parent_1->GetHash() != tx_parent_2->GetHash() && tx_parent_2->GetHash() != tx_parent_3->GetHash());
+
+        // 1 parent paying 200sat, 1 child paying 200sat.
+        Package package1{tx_parent_1, tx_child_1};
+        // 1 parent paying 800sat, 1 child paying 200sat.
+        Package package2{tx_parent_2, tx_child_2};
+        // 1 parent paying 199sat, 1 child paying 1300sat.
+        Package package3{tx_parent_3, tx_child_3};
+
+        const auto submit1 = ProcessNewPackage(m_node.chainman->ActiveChainstate(), *m_node.mempool, package1, false, std::nullopt);
+        if (auto err_1{CheckPackageMempoolAcceptResult(package1, submit1, /*expect_valid=*/true, m_node.mempool.get())}) {
+            BOOST_ERROR(err_1.value());
+        }
+        auto it_parent_1 = submit1.m_tx_results.find(tx_parent_1->GetWitnessHash());
+        auto it_child_1 = submit1.m_tx_results.find(tx_child_1->GetWitnessHash());
+        BOOST_CHECK_EQUAL(it_parent_1->second.m_result_type, MempoolAcceptResult::ResultType::VALID);
+        BOOST_CHECK_EQUAL(it_child_1->second.m_result_type, MempoolAcceptResult::ResultType::VALID);
+        expected_pool_size += 2;
+        BOOST_CHECK_EQUAL(m_node.mempool->size(), expected_pool_size);
+
+        // This replacement is actually not package rbf; the parent carries enough fees
+        // to replace the entire package on its own.
+        const auto submit2 = ProcessNewPackage(m_node.chainman->ActiveChainstate(), *m_node.mempool, package2, false, std::nullopt);
+        if (auto err_2{CheckPackageMempoolAcceptResult(package2, submit2, /*expect_valid=*/true, m_node.mempool.get())}) {
+            BOOST_ERROR(err_2.value());
+        }
+        auto it_parent_2 = submit2.m_tx_results.find(tx_parent_2->GetWitnessHash());
+        auto it_child_2 = submit2.m_tx_results.find(tx_child_2->GetWitnessHash());
+        BOOST_CHECK_EQUAL(it_parent_2->second.m_result_type, MempoolAcceptResult::ResultType::VALID);
+        BOOST_CHECK_EQUAL(it_child_2->second.m_result_type, MempoolAcceptResult::ResultType::VALID);
+        BOOST_CHECK_EQUAL(m_node.mempool->size(), expected_pool_size);
+
+        // Package RBF, in which the replacement transaction's child sponsors the fees to meet RBF feerate rules
+        const auto submit3 = ProcessNewPackage(m_node.chainman->ActiveChainstate(), *m_node.mempool, package3, false, std::nullopt);
+        if (auto err_3{CheckPackageMempoolAcceptResult(package3, submit3, /*expect_valid=*/true, m_node.mempool.get())}) {
+            BOOST_ERROR(err_3.value());
+        }
+        auto it_parent_3 = submit3.m_tx_results.find(tx_parent_3->GetWitnessHash());
+        auto it_child_3 = submit3.m_tx_results.find(tx_child_3->GetWitnessHash());
+        BOOST_CHECK_EQUAL(it_parent_3->second.m_result_type, MempoolAcceptResult::ResultType::VALID);
+        BOOST_CHECK_EQUAL(it_child_3->second.m_result_type, MempoolAcceptResult::ResultType::VALID);
+
+        // package3 was considered as a package to replace both package2 transactions
+        BOOST_CHECK(it_parent_3->second.m_replaced_transactions.size() == 2);
+        BOOST_CHECK(it_child_3->second.m_replaced_transactions.empty());
+
+        std::vector<Wtxid> expected_package3_wtxids({tx_parent_3->GetWitnessHash(), tx_child_3->GetWitnessHash()});
+        const auto package3_total_vsize{GetVirtualTransactionSize(*tx_parent_3) + GetVirtualTransactionSize(*tx_child_3)};
+        BOOST_CHECK(it_parent_3->second.m_wtxids_fee_calculations.value() == expected_package3_wtxids);
+        BOOST_CHECK(it_child_3->second.m_wtxids_fee_calculations.value() == expected_package3_wtxids);
+        BOOST_CHECK_EQUAL(it_parent_3->second.m_effective_feerate.value().GetFee(package3_total_vsize), 199 + 1300);
+        BOOST_CHECK_EQUAL(it_child_3->second.m_effective_feerate.value().GetFee(package3_total_vsize), 199 + 1300);
+
+        BOOST_CHECK_EQUAL(m_node.mempool->size(), expected_pool_size);
+    }
+
+}
 BOOST_AUTO_TEST_SUITE_END()
diff --git a/test/functional/mempool_package_rbf.py b/test/functional/mempool_package_rbf.py
new file mode 100755
index 00000000000..ceb95303941
--- /dev/null
+++ b/test/functional/mempool_package_rbf.py
@@ -0,0 +1,587 @@
+#!/usr/bin/env python3
+# Copyright (c) 2021 The Bitcoin Core developers
+# Distributed under the MIT software license, see the accompanying
+# file COPYING or http://www.opensource.org/licenses/mit-license.php.
+
+from decimal import Decimal
+
+from test_framework.messages import (
+    COIN,
+    MAX_BIP125_RBF_SEQUENCE,
+)
+from test_framework.test_framework import BitcoinTestFramework
+from test_framework.mempool_util import fill_mempool
+from test_framework.util import (
+    assert_greater_than_or_equal,
+    assert_equal,
+)
+from test_framework.wallet import (
+    DEFAULT_FEE,
+    MiniWallet,
+)
+
+MAX_REPLACEMENT_CANDIDATES = 100
+
+# Value high enough to cause evictions in each subtest
+# for typical cases
+DEFAULT_CHILD_FEE = DEFAULT_FEE * 4
+
+class PackageRBFTest(BitcoinTestFramework):
+    def set_test_params(self):
+        self.num_nodes = 2
+        self.setup_clean_chain = True
+        # Required for fill_mempool()
+        self.extra_args = [[
+            "-datacarriersize=100000",
+            "-maxmempool=5",
+        ]] * self.num_nodes
+
+    def assert_mempool_contents(self, expected=None):
+        """Assert that all transactions in expected are in the mempool,
+        and no additional ones exist.
+        """
+        if not expected:
+            expected = []
+        mempool = self.nodes[0].getrawmempool(verbose=False)
+        assert_equal(len(mempool), len(expected))
+        for tx in expected:
+            assert tx.rehash() in mempool
+
+    def create_simple_package(self, parent_coin, parent_fee=DEFAULT_FEE, child_fee=DEFAULT_CHILD_FEE, heavy_child=False):
+        """Create a 1 parent 1 child package using the coin passed in as the parent's input. The
+        parent has 1 output, used to fund 1 child transaction.
+        All transactions signal BIP125 replaceability, but nSequence changes based on self.ctr. This
+        prevents identical txids between packages when the parents spend the same coin and have the
+        same fee (i.e. 0sat).
+
+        returns tuple (hex serialized txns, CTransaction objects)
+        """
+        self.ctr += 1
+        # Use fee_rate=0 because create_self_transfer will use the default fee_rate value otherwise.
+        # Passing in fee>0 overrides fee_rate, so this still works for non-zero parent_fee.
+        parent_result = self.wallet.create_self_transfer(
+            fee=parent_fee,
+            utxo_to_spend=parent_coin,
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        num_child_outputs = 10 if heavy_child else 1
+        child_result = self.wallet.create_self_transfer_multi(
+            utxos_to_spend=[parent_result["new_utxo"]],
+            num_outputs=num_child_outputs,
+            fee_per_output=int(child_fee * COIN // num_child_outputs),
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+        package_hex = [parent_result["hex"], child_result["hex"]]
+        package_txns = [parent_result["tx"], child_result["tx"]]
+        return package_hex, package_txns
+
+    def run_test(self):
+        # Counter used to count the number of times we constructed packages. Since we're constructing parent transactions with the same
+        # coins (to create conflicts), and perhaps giving them the same fee, we might accidentally just create the same transaction again.
+        # To prevent this, set nSequences to MAX_BIP125_RBF_SEQUENCE - self.ctr.
+        self.ctr = 0
+
+        self.log.info("Generate blocks to create UTXOs")
+        self.wallet = MiniWallet(self.nodes[0])
+
+        # Make more than enough coins for the sum of all tests,
+        # otherwise a wallet rescan is needed later
+        self.generate(self.wallet, 300)
+        self.coins = self.wallet.get_utxos(mark_as_spent=False)
+
+        self.test_package_rbf_basic()
+        self.test_package_rbf_singleton()
+        self.test_package_rbf_additional_fees()
+        self.test_package_rbf_max_conflicts()
+        self.test_too_numerous_ancestors()
+        self.test_package_rbf_with_wrong_pkg_size()
+        self.test_insufficient_feerate()
+        self.test_wrong_conflict_cluster_size_linear()
+        self.test_wrong_conflict_cluster_size_parents_child()
+        self.test_wrong_conflict_cluster_size_parent_children()
+        self.test_0fee_package_rbf()
+        self.test_child_conflicts_parent_mempool_ancestor()
+
+    def test_package_rbf_basic(self):
+        self.log.info("Test that a child can pay to replace its parents' conflicts of cluster size 2")
+        node = self.nodes[0]
+        # Reuse the same coins so that the transactions conflict with one another.
+        parent_coin = self.coins.pop()
+        package_hex1, package_txns1 = self.create_simple_package(parent_coin, DEFAULT_FEE, DEFAULT_FEE)
+        package_hex2, package_txns2 = self.create_simple_package(parent_coin, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+        node.submitpackage(package_hex1)
+        self.assert_mempool_contents(expected=package_txns1)
+
+        # Make sure 2nd node gets set up for basic package RBF
+        self.sync_all()
+
+        # Test run rejected because conflicts are not allowed in subpackage evaluation
+        testres = node.testmempoolaccept(package_hex2)
+        assert_equal(testres[0]["reject-reason"], "bip125-replacement-disallowed")
+
+        # But accepted during normal submission
+        submitres = node.submitpackage(package_hex2)
+        assert_equal(set(submitres["replaced-transactions"]), set([tx.rehash() for tx in package_txns1]))
+        self.assert_mempool_contents(expected=package_txns2)
+
+        # Make sure 2nd node gets a basic package RBF over p2p
+        self.sync_all()
+
+        self.generate(node, 1)
+
+    def test_package_rbf_singleton(self):
+        self.log.info("Test child can pay to replace a parent's single conflicted tx")
+        node = self.nodes[0]
+
+        # Make singleton tx to conflict with in next batch
+        singleton_coin = self.coins.pop()
+        singleton_tx = self.wallet.create_self_transfer(utxo_to_spend=singleton_coin)
+        node.sendrawtransaction(singleton_tx["hex"])
+        self.assert_mempool_contents(expected=[singleton_tx["tx"]])
+
+        package_hex, package_txns = self.create_simple_package(singleton_coin, DEFAULT_FEE, singleton_tx["fee"] * 2)
+
+        submitres = node.submitpackage(package_hex)
+        assert_equal(submitres["replaced-transactions"], [singleton_tx["tx"].rehash()])
+        self.assert_mempool_contents(expected=package_txns)
+
+        self.generate(node, 1)
+
+    def test_package_rbf_additional_fees(self):
+        self.log.info("Check Package RBF must increase the absolute fee")
+        node = self.nodes[0]
+        coin = self.coins.pop()
+
+        package_hex1, package_txns1 = self.create_simple_package(coin, parent_fee=DEFAULT_FEE, child_fee=DEFAULT_CHILD_FEE, heavy_child=True)
+        assert_greater_than_or_equal(1000, package_txns1[-1].get_vsize())
+        node.submitpackage(package_hex1)
+        self.assert_mempool_contents(expected=package_txns1)
+
+        PACKAGE_FEE = DEFAULT_FEE + DEFAULT_CHILD_FEE
+        PACKAGE_FEE_MINUS_ONE = PACKAGE_FEE - Decimal("0.00000001")
+
+        # Package 2 has a higher feerate but lower absolute fee
+        package_hex2, package_txns2 = self.create_simple_package(coin, parent_fee=DEFAULT_FEE, child_fee=DEFAULT_CHILD_FEE - Decimal("0.00000001"))
+        pkg_results2 = node.submitpackage(package_hex2)
+        assert_equal(f"package RBF failed: insufficient anti-DoS fees, rejecting replacement {package_txns2[1].rehash()}, less fees than conflicting txs; {PACKAGE_FEE_MINUS_ONE} < {PACKAGE_FEE}", pkg_results2["package_msg"])
+        self.assert_mempool_contents(expected=package_txns1)
+
+        self.log.info("Check replacement pays for incremental bandwidth")
+        package_hex3, package_txns3 = self.create_simple_package(coin, parent_fee=DEFAULT_FEE, child_fee=DEFAULT_CHILD_FEE)
+        pkg_results3 = node.submitpackage(package_hex3)
+        assert_equal(f"package RBF failed: insufficient anti-DoS fees, rejecting replacement {package_txns3[1].rehash()}, not enough additional fees to relay; 0.00 < 0.00000{sum([tx.get_vsize() for tx in package_txns3])}", pkg_results3["package_msg"])
+
+        self.assert_mempool_contents(expected=package_txns1)
+        self.generate(node, 1)
+
+        self.log.info("Check Package RBF must have strict cpfp structure")
+        coin = self.coins.pop()
+        package_hex4, package_txns4 = self.create_simple_package(coin, parent_fee=DEFAULT_FEE, child_fee=DEFAULT_CHILD_FEE)
+        node.submitpackage(package_hex4)
+        self.assert_mempool_contents(expected=package_txns4)
+        package_hex5, package_txns5 = self.create_simple_package(coin, parent_fee=DEFAULT_CHILD_FEE, child_fee=DEFAULT_CHILD_FEE - Decimal("0.00000001"))
+        pkg_results5 = node.submitpackage(package_hex5)
+        assert 'package RBF failed: package feerate is less than parent feerate' in pkg_results5["package_msg"]
+
+        self.assert_mempool_contents(expected=package_txns4)
+        self.generate(node, 1)
+
+    def test_package_rbf_max_conflicts(self):
+        node = self.nodes[0]
+        self.log.info("Check Package RBF cannot replace more than MAX_REPLACEMENT_CANDIDATES transactions")
+        num_coins = 51
+        parent_coins = self.coins[:num_coins]
+        del self.coins[:num_coins]
+
+        # Original transactions: 51 transactions with 1 descendants each -> 102 total transactions
+        size_two_clusters = []
+        for coin in parent_coins:
+            size_two_clusters.append(self.wallet.send_self_transfer_chain(from_node=node, chain_length=2, utxo_to_spend=coin))
+        expected_txns = [txn["tx"] for parent_child_txns in size_two_clusters for txn in parent_child_txns]
+        assert_equal(len(expected_txns), num_coins * 2)
+        self.assert_mempool_contents(expected=expected_txns)
+
+        # parent feeerate needs to be high enough for minrelay
+        # child feerate needs to be large enough to trigger package rbf with a very large parent and
+        # pay for all evicted fees. maxfeerate turned off for all submissions since child feerate
+        # is extremely high
+        parent_fee_per_conflict = 10000
+        child_feerate = 10000 * DEFAULT_FEE
+
+        # Conflict against all transactions by double-spending each parent, causing 102 evictions
+        package_parent = self.wallet.create_self_transfer_multi(utxos_to_spend=parent_coins, fee_per_output=parent_fee_per_conflict)
+        package_child = self.wallet.create_self_transfer(fee_rate=child_feerate, utxo_to_spend=package_parent["new_utxos"][0])
+
+        pkg_results = node.submitpackage([package_parent["hex"], package_child["hex"]], maxfeerate=0)
+        assert_equal(f"package RBF failed: too many potential replacements, rejecting replacement {package_child['tx'].rehash()}; too many potential replacements (102 > 100)\n", pkg_results["package_msg"])
+        self.assert_mempool_contents(expected=expected_txns)
+
+        # Make singleton tx to conflict with in next batch
+        singleton_coin = self.coins.pop()
+        singleton_tx = self.wallet.create_self_transfer(utxo_to_spend=singleton_coin)
+        node.sendrawtransaction(singleton_tx["hex"])
+        expected_txns.append(singleton_tx["tx"])
+
+        # Double-spend same set minus last, and double-spend singleton. This hits 101 evictions; should still fail.
+        # N.B. we can't RBF just a child tx in the clusters, as that would make resulting cluster of size 3.
+        double_spending_coins = parent_coins[:-1] + [singleton_coin]
+        package_parent = self.wallet.create_self_transfer_multi(utxos_to_spend=double_spending_coins, fee_per_output=parent_fee_per_conflict)
+        package_child = self.wallet.create_self_transfer(fee_rate=child_feerate, utxo_to_spend=package_parent["new_utxos"][0])
+        pkg_results = node.submitpackage([package_parent["hex"], package_child["hex"]], maxfeerate=0)
+        assert_equal(f"package RBF failed: too many potential replacements, rejecting replacement {package_child['tx'].rehash()}; too many potential replacements (101 > 100)\n", pkg_results["package_msg"])
+        self.assert_mempool_contents(expected=expected_txns)
+
+        # Finally, evict MAX_REPLACEMENT_CANDIDATES
+        package_parent = self.wallet.create_self_transfer_multi(utxos_to_spend=parent_coins[:-1], fee_per_output=parent_fee_per_conflict)
+        package_child = self.wallet.create_self_transfer(fee_rate=child_feerate, utxo_to_spend=package_parent["new_utxos"][0])
+        pkg_results = node.submitpackage([package_parent["hex"], package_child["hex"]], maxfeerate=0)
+        assert_equal(pkg_results["package_msg"], "success")
+        self.assert_mempool_contents(expected=[singleton_tx["tx"], size_two_clusters[-1][0]["tx"], size_two_clusters[-1][1]["tx"], package_parent["tx"], package_child["tx"]] )
+
+        self.generate(node, 1)
+
+    def test_too_numerous_ancestors(self):
+        self.log.info("Test that package RBF doesn't work with packages larger than 2 due to ancestors")
+        node = self.nodes[0]
+        coin = self.coins.pop()
+
+        package_hex1, package_txns1 = self.create_simple_package(coin, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+        node.submitpackage(package_hex1)
+        self.assert_mempool_contents(expected=package_txns1)
+
+        # Double-spends the original package
+        self.ctr += 1
+        parent_result1 = self.wallet.create_self_transfer(
+            fee=DEFAULT_FEE,
+            utxo_to_spend=coin,
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        coin2 = self.coins.pop()
+
+        # Added to make package too large for package RBF;
+        # it will enter mempool individually
+        self.ctr += 1
+        parent_result2 = self.wallet.create_self_transfer(
+            fee=DEFAULT_FEE,
+            utxo_to_spend=coin2,
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        # Child that spends both, violating cluster size rule due
+        # to in-mempool ancestry
+        self.ctr += 1
+        child_result = self.wallet.create_self_transfer_multi(
+            fee_per_output=int(DEFAULT_CHILD_FEE * COIN),
+            utxos_to_spend=[parent_result1["new_utxo"], parent_result2["new_utxo"]],
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        package_hex2 = [parent_result1["hex"], parent_result2["hex"], child_result["hex"]]
+        package_txns2_succeed = [parent_result2["tx"]]
+
+        pkg_result = node.submitpackage(package_hex2)
+        assert_equal(pkg_result["package_msg"], 'package RBF failed: new transaction cannot have mempool ancestors')
+        self.assert_mempool_contents(expected=package_txns1 + package_txns2_succeed)
+        self.generate(node, 1)
+
+    def test_wrong_conflict_cluster_size_linear(self):
+        self.log.info("Test that conflicting with a cluster not sized two is rejected: linear chain")
+        node = self.nodes[0]
+
+        # Coins we will conflict with
+        coin1 = self.coins.pop()
+        coin2 = self.coins.pop()
+        coin3 = self.coins.pop()
+
+        # Three transactions chained; package RBF against any of these
+        # should be rejected
+        self.ctr += 1
+        parent_result = self.wallet.create_self_transfer(
+            fee=DEFAULT_FEE,
+            utxo_to_spend=coin1,
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        self.ctr += 1
+        child_result = self.wallet.create_self_transfer_multi(
+            fee_per_output=int(DEFAULT_FEE * COIN),
+            utxos_to_spend=[parent_result["new_utxo"], coin2],
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        self.ctr += 1
+        grandchild_result = self.wallet.create_self_transfer_multi(
+            fee_per_output=int(DEFAULT_FEE * COIN),
+            utxos_to_spend=[child_result["new_utxos"][0], coin3],
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        expected_txns = [parent_result["tx"], child_result["tx"], grandchild_result["tx"]]
+        for tx in expected_txns:
+            node.sendrawtransaction(tx.serialize().hex())
+        self.assert_mempool_contents(expected=expected_txns)
+
+        # Now make conflicting packages for each coin
+        package_hex1, package_txns1 = self.create_simple_package(coin1, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+
+        package_result = node.submitpackage(package_hex1)
+        assert_equal(f"package RBF failed: {parent_result['tx'].rehash()} has 2 descendants, max 1 allowed", package_result["package_msg"])
+
+        package_hex2, package_txns2 = self.create_simple_package(coin2, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+        package_result = node.submitpackage(package_hex2)
+        assert_equal(f"package RBF failed: {child_result['tx'].rehash()} has both ancestor and descendant, exceeding cluster limit of 2", package_result["package_msg"])
+
+        package_hex3, package_txns3 = self.create_simple_package(coin3, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+        package_result = node.submitpackage(package_hex3)
+        assert_equal(f"package RBF failed: {grandchild_result['tx'].rehash()} has 2 ancestors, max 1 allowed", package_result["package_msg"])
+
+        # Check that replacements were actually rejected
+        self.assert_mempool_contents(expected=expected_txns)
+        self.generate(node, 1)
+
+    def test_wrong_conflict_cluster_size_parents_child(self):
+        self.log.info("Test that conflicting with a cluster not sized two is rejected: two parents one child")
+        node = self.nodes[0]
+
+        # Coins we will conflict with
+        coin1 = self.coins.pop()
+        coin2 = self.coins.pop()
+        coin3 = self.coins.pop()
+
+        self.ctr += 1
+        parent1_result = self.wallet.create_self_transfer(
+            fee=DEFAULT_FEE,
+            utxo_to_spend=coin1,
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        self.ctr += 1
+        parent2_result = self.wallet.create_self_transfer_multi(
+            fee_per_output=int(DEFAULT_FEE * COIN),
+            utxos_to_spend=[coin2],
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        self.ctr += 1
+        child_result = self.wallet.create_self_transfer_multi(
+            fee_per_output=int(DEFAULT_FEE * COIN),
+            utxos_to_spend=[parent1_result["new_utxo"], parent2_result["new_utxos"][0], coin3],
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        expected_txns = [parent1_result["tx"], parent2_result["tx"], child_result["tx"]]
+        for tx in expected_txns:
+            node.sendrawtransaction(tx.serialize().hex())
+        self.assert_mempool_contents(expected=expected_txns)
+
+        # Now make conflicting packages for each coin
+        package_hex1, package_txns1 = self.create_simple_package(coin1, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+        package_result = node.submitpackage(package_hex1)
+        assert_equal(f"package RBF failed: {parent1_result['tx'].rehash()} is not the only parent of child {child_result['tx'].rehash()}", package_result["package_msg"])
+
+        package_hex2, package_txns2 = self.create_simple_package(coin2, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+        package_result = node.submitpackage(package_hex2)
+        assert_equal(f"package RBF failed: {parent2_result['tx'].rehash()} is not the only parent of child {child_result['tx'].rehash()}", package_result["package_msg"])
+
+        package_hex3, package_txns3 = self.create_simple_package(coin3, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+        package_result = node.submitpackage(package_hex3)
+        assert_equal(f"package RBF failed: {child_result['tx'].rehash()} has 2 ancestors, max 1 allowed", package_result["package_msg"])
+
+        # Check that replacements were actually rejected
+        self.assert_mempool_contents(expected=expected_txns)
+        self.generate(node, 1)
+
+    def test_wrong_conflict_cluster_size_parent_children(self):
+        self.log.info("Test that conflicting with a cluster not sized two is rejected: one parent two children")
+        node = self.nodes[0]
+
+        # Coins we will conflict with
+        coin1 = self.coins.pop()
+        coin2 = self.coins.pop()
+        coin3 = self.coins.pop()
+
+        self.ctr += 1
+        parent_result = self.wallet.create_self_transfer_multi(
+            fee_per_output=int(DEFAULT_FEE * COIN),
+            num_outputs=2,
+            utxos_to_spend=[coin1],
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        self.ctr += 1
+        child1_result = self.wallet.create_self_transfer_multi(
+            fee_per_output=int(DEFAULT_FEE * COIN),
+            utxos_to_spend=[parent_result["new_utxos"][0], coin2],
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        self.ctr += 1
+        child2_result = self.wallet.create_self_transfer_multi(
+            fee_per_output=int(DEFAULT_FEE * COIN),
+            utxos_to_spend=[parent_result["new_utxos"][1], coin3],
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        # Submit them to mempool
+        expected_txns = [parent_result["tx"], child1_result["tx"], child2_result["tx"]]
+        for tx in expected_txns:
+            node.sendrawtransaction(tx.serialize().hex())
+        self.assert_mempool_contents(expected=expected_txns)
+
+        # Now make conflicting packages for each coin
+        package_hex1, package_txns1 = self.create_simple_package(coin1, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+        package_result = node.submitpackage(package_hex1)
+        assert_equal(f"package RBF failed: {parent_result['tx'].rehash()} has 2 descendants, max 1 allowed", package_result["package_msg"])
+
+        package_hex2, package_txns2 = self.create_simple_package(coin2, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+        package_result = node.submitpackage(package_hex2)
+        assert_equal(f"package RBF failed: {child1_result['tx'].rehash()} is not the only child of parent {parent_result['tx'].rehash()}", package_result["package_msg"])
+
+        package_hex3, package_txns3 = self.create_simple_package(coin3, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+        package_result = node.submitpackage(package_hex3)
+        assert_equal(f"package RBF failed: {child2_result['tx'].rehash()} is not the only child of parent {parent_result['tx'].rehash()}", package_result["package_msg"])
+
+        # Check that replacements were actually rejected
+        self.assert_mempool_contents(expected=expected_txns)
+        self.generate(node, 1)
+
+    def test_package_rbf_with_wrong_pkg_size(self):
+        self.log.info("Test that package RBF doesn't work with packages larger than 2 due to pkg size")
+        node = self.nodes[0]
+        coin1 = self.coins.pop()
+        coin2 = self.coins.pop()
+
+        # Two packages to require multiple direct conflicts, easier to set up illicit pkg size
+        package_hex1, package_txns1 = self.create_simple_package(coin1, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+        package_hex2, package_txns2 = self.create_simple_package(coin2, DEFAULT_FEE, DEFAULT_CHILD_FEE)
+
+        node.submitpackage(package_hex1)
+        node.submitpackage(package_hex2)
+
+        self.assert_mempool_contents(expected=package_txns1 + package_txns2)
+        assert_equal(len(node.getrawmempool()), 4)
+
+        # Double-spends the first package
+        self.ctr += 1
+        parent_result1 = self.wallet.create_self_transfer(
+            fee=DEFAULT_FEE,
+            utxo_to_spend=coin1,
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        # Double-spends the second package
+        self.ctr += 1
+        parent_result2 = self.wallet.create_self_transfer(
+            fee=DEFAULT_FEE,
+            utxo_to_spend=coin2,
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        # Child that spends both, violating cluster size rule due
+        # to pkg size
+        self.ctr += 1
+        child_result = self.wallet.create_self_transfer_multi(
+            fee_per_output=int(DEFAULT_CHILD_FEE * COIN),
+            utxos_to_spend=[parent_result1["new_utxo"], parent_result2["new_utxo"]],
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        package_hex3 = [parent_result1["hex"], parent_result2["hex"], child_result["hex"]]
+
+        pkg_result = node.submitpackage(package_hex3)
+        assert_equal(pkg_result["package_msg"], 'package RBF failed: package must be 1-parent-1-child')
+        self.assert_mempool_contents(expected=package_txns1 + package_txns2)
+        self.generate(node, 1)
+
+    def test_insufficient_feerate(self):
+        self.log.info("Check Package RBF must beat feerate of direct conflict")
+        node = self.nodes[0]
+        coin = self.coins.pop()
+
+        # Non-cpfp structure
+        package_hex1, package_txns1 = self.create_simple_package(coin, parent_fee=DEFAULT_CHILD_FEE, child_fee=DEFAULT_FEE)
+        node.submitpackage(package_hex1)
+        self.assert_mempool_contents(expected=package_txns1)
+
+        # Package 2 feerate is below the feerate of directly conflicted parent, so it fails even though
+        # total fees are higher than the original package
+        package_hex2, package_txns2 = self.create_simple_package(coin, parent_fee=DEFAULT_CHILD_FEE - Decimal("0.00000001"), child_fee=DEFAULT_CHILD_FEE)
+        pkg_results2 = node.submitpackage(package_hex2)
+        assert_equal(pkg_results2["package_msg"], 'package RBF failed: insufficient feerate: does not improve feerate diagram')
+        self.assert_mempool_contents(expected=package_txns1)
+        self.generate(node, 1)
+
+    def test_0fee_package_rbf(self):
+        self.log.info("Test package RBF: TRUC 0-fee parent + high-fee child replaces parent's conflicts")
+        node = self.nodes[0]
+        # Reuse the same coins so that the transactions conflict with one another.
+        self.wallet.rescan_utxos()
+        parent_coin = self.wallet.get_utxo(confirmed_only=True)
+
+        # package1 pays default fee on both transactions
+        parent1 = self.wallet.create_self_transfer(utxo_to_spend=parent_coin, version=3)
+        child1 = self.wallet.create_self_transfer(utxo_to_spend=parent1["new_utxo"], version=3)
+        package_hex1 = [parent1["hex"], child1["hex"]]
+        fees_package1 = parent1["fee"] + child1["fee"]
+        submitres1 = node.submitpackage(package_hex1)
+        assert_equal(submitres1["package_msg"], "success")
+        self.assert_mempool_contents([parent1["tx"], child1["tx"]])
+
+        # package2 has a 0-fee parent (conflicting with package1) and very high fee child
+        parent2 = self.wallet.create_self_transfer(utxo_to_spend=parent_coin, fee=0, fee_rate=0, version=3)
+        child2 = self.wallet.create_self_transfer(utxo_to_spend=parent2["new_utxo"], fee=fees_package1*10, version=3)
+        package_hex2 = [parent2["hex"], child2["hex"]]
+
+        submitres2 = node.submitpackage(package_hex2)
+        assert_equal(submitres2["package_msg"], "success")
+        assert_equal(set(submitres2["replaced-transactions"]), set([parent1["txid"], child1["txid"]]))
+        self.assert_mempool_contents([parent2["tx"], child2["tx"]])
+
+        self.generate(node, 1)
+
+    def test_child_conflicts_parent_mempool_ancestor(self):
+        fill_mempool(self, self.nodes[0])
+        # Reset coins since we filled the mempool with current coins
+        self.coins = self.wallet.get_utxos(mark_as_spent=False, confirmed_only=True)
+
+        self.log.info("Test that package RBF doesn't have issues with mempool<->package conflicts via inconsistency")
+        node = self.nodes[0]
+        coin = self.coins.pop()
+
+        self.ctr += 1
+        grandparent_result = self.wallet.create_self_transfer(
+            fee=DEFAULT_FEE,
+            utxo_to_spend=coin,
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        node.sendrawtransaction(grandparent_result["hex"])
+
+        # Now make package of two descendants that looks
+        # like a cpfp where the parent can't get in on its own
+        self.ctr += 1
+        parent_result = self.wallet.create_self_transfer(
+            fee_rate=Decimal('0.00001000'),
+            utxo_to_spend=grandparent_result["new_utxo"],
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+        # Last tx double-spends grandparent's coin,
+        # which is not inside the current package
+        self.ctr += 1
+        child_result = self.wallet.create_self_transfer_multi(
+            fee_per_output=int(DEFAULT_CHILD_FEE * COIN),
+            utxos_to_spend=[parent_result["new_utxo"], coin],
+            sequence=MAX_BIP125_RBF_SEQUENCE - self.ctr,
+        )
+
+        pkg_result = node.submitpackage([parent_result["hex"], child_result["hex"]])
+        assert_equal(pkg_result["package_msg"], 'package RBF failed: new transaction cannot have mempool ancestors')
+        mempool_info = node.getrawmempool()
+        assert grandparent_result["txid"] in mempool_info
+        assert parent_result["txid"] not in mempool_info
+        assert child_result["txid"] not in mempool_info
+
+if __name__ == "__main__":
+    PackageRBFTest().main()
diff --git a/test/functional/test_runner.py b/test/functional/test_runner.py
index 725b116281a..e9632b243e0 100755
--- a/test/functional/test_runner.py
+++ b/test/functional/test_runner.py
@@ -280,6 +280,7 @@ BASE_SCRIPTS = [
     'mempool_packages.py',
     'mempool_package_onemore.py',
     'mempool_package_limits.py',
+    'mempool_package_rbf.py',
     'feature_versionbits_warning.py',
     'rpc_preciousblock.py',
     'wallet_importprunedfunds.py --legacy-wallet',