diff --git a/keras_core/layers/layer_test.py b/keras_core/layers/layer_test.py
index 15e434690..5f8d362ea 100644
--- a/keras_core/layers/layer_test.py
+++ b/keras_core/layers/layer_test.py
@@ -176,3 +176,54 @@ class LayerTest(testing.TestCase):
         model(np.ones((1,)))
         self.assertLen(model.losses, 1)
         self.assertAllClose(model.losses[0], 1.0)
+
+    def test_training_arg_value_resolution(self):
+        # Check that even if `training` is not passed
+        # to an inner layer, the outer value gets propagated
+        # in __call__.
+        class TrainingLayer(layers.Layer):
+            def __init__(self):
+                super().__init__()
+                self.dp = layers.Dropout(0.9)
+
+            def call(self, x, training=False):
+                return self.dp(x)
+
+        layer = TrainingLayer()
+        x = np.ones((4, 4))
+        y = layer(x)
+        self.assertEqual(ops.min(y), 1)
+        y = layer(x, training=True)
+        self.assertEqual(ops.min(y), 0)
+
+        # Check that it still works one level deeper.
+        class WrappedTrainingLayer(layers.Layer):
+            def __init__(self):
+                super().__init__()
+                self.dp = TrainingLayer()
+
+            def call(self, x, training=False):
+                return self.dp(x)
+
+        layer = WrappedTrainingLayer()
+        x = np.ones((4, 4))
+        y = layer(x)
+        self.assertEqual(ops.min(y), 1)
+        y = layer(x, training=True)
+        self.assertEqual(ops.min(y), 0)
+
+        # Check that if `training` is passed
+        # to an inner layer in call(), the explicitly
+        # passed value is what the layer sees.
+        class TrainingLayerExplicit(layers.Layer):
+            def __init__(self):
+                super().__init__()
+                self.dp = layers.Dropout(0.9)
+
+            def call(self, x, training=False):
+                return self.dp(x, training=True)
+
+        layer = TrainingLayerExplicit()
+        x = np.ones((4, 4))
+        y = layer(x, training=False)
+        self.assertEqual(ops.min(y), 0)