diff --git a/instrumentation/reactor-netty/reactor-netty-1.0/javaagent/build.gradle.kts b/instrumentation/reactor-netty/reactor-netty-1.0/javaagent/build.gradle.kts
index 403f7947ea25..032bd1bcfbb5 100644
--- a/instrumentation/reactor-netty/reactor-netty-1.0/javaagent/build.gradle.kts
+++ b/instrumentation/reactor-netty/reactor-netty-1.0/javaagent/build.gradle.kts
@@ -23,6 +23,10 @@ dependencies {
   testInstrumentation(project(":instrumentation:reactor-netty:reactor-netty-0.9:javaagent"))
   testInstrumentation(project(":instrumentation:netty:netty-4.1:javaagent"))
   testInstrumentation(project(":instrumentation:reactor-3.1:javaagent"))
+
+  testLibrary("io.projectreactor:reactor-test:3.1.0.RELEASE")
+  testImplementation("io.opentelemetry:opentelemetry-extension-annotations")
+  testInstrumentation(project(":instrumentation:opentelemetry-annotations-1.0:javaagent"))
 }
 
 tasks {
diff --git a/instrumentation/reactor-netty/reactor-netty-1.0/javaagent/src/test/groovy/ReactorNettyWithSpanTest.groovy b/instrumentation/reactor-netty/reactor-netty-1.0/javaagent/src/test/groovy/ReactorNettyWithSpanTest.groovy
new file mode 100644
index 000000000000..8f0dd41c7f14
--- /dev/null
+++ b/instrumentation/reactor-netty/reactor-netty-1.0/javaagent/src/test/groovy/ReactorNettyWithSpanTest.groovy
@@ -0,0 +1,85 @@
+/*
+ * Copyright The OpenTelemetry Authors
+ * SPDX-License-Identifier: Apache-2.0
+ */
+
+import io.opentelemetry.api.trace.Span
+import io.opentelemetry.extension.annotations.WithSpan
+import io.opentelemetry.instrumentation.api.internal.ContextPropagationDebug
+import io.opentelemetry.instrumentation.test.AgentTestTrait
+import io.opentelemetry.instrumentation.test.InstrumentationSpecification
+import io.opentelemetry.instrumentation.testing.junit.http.HttpClientTestServer
+import io.opentelemetry.test.reactor.netty.TracedWithSpan
+import reactor.core.publisher.Mono
+import reactor.netty.http.client.HttpClient
+import reactor.test.StepVerifier
+import spock.lang.Shared
+
+import java.time.Duration
+import java.util.concurrent.Callable
+
+import static io.opentelemetry.api.trace.SpanKind.CLIENT
+import static io.opentelemetry.api.trace.SpanKind.INTERNAL
+import static io.opentelemetry.api.trace.SpanKind.SERVER
+
+class ReactorNettyWithSpanTest extends InstrumentationSpecification implements AgentTestTrait {
+
+  @Shared
+  private HttpClientTestServer server
+
+  def setupSpec() {
+    server = new HttpClientTestServer(openTelemetry)
+    server.start()
+  }
+
+  def cleanupSpec() {
+    server.stop()
+  }
+
+  def "test successful nested under WithSpan1"() {
+    when:
+    def httpClient = HttpClient.create()
+
+    def httpRequest = Mono.defer({ ->
+      httpClient.get().uri("http://localhost:${server.httpPort()}/success")
+        .responseSingle ({ resp, content ->
+          // Make sure to consume content since that's when we close the span.
+          content.map { resp }
+        })
+        .map({ r -> r.status().code() })
+    })
+
+    def getResponse = new TracedWithSpan().mono(
+      // our HTTP server is synchronous, i.e. it returns Mono.just with response
+      // which is not supported by TracingSubscriber - it does not instrument scalar calls
+      // so we delay here to fake async http request and let Reactor context instrumentation work
+      Mono.delay(Duration.ofMillis(1)).then(httpRequest))
+
+    then:
+    StepVerifier.create(getResponse)
+      .expectNext(200)
+      .expectComplete()
+      .verify()
+
+    assertTraces(1) {
+      trace(0, 3) {
+        span(0) {
+          name "TracedWithSpan.mono"
+          kind INTERNAL
+          hasNoParent()
+        }
+        span(1) {
+          name "HTTP GET"
+          kind CLIENT
+          childOf(span(0))
+        }
+        span(2) {
+          name "test-http-server"
+          kind SERVER
+          childOf(span(1))
+        }
+      }
+    }
+  }
+
+}
diff --git a/instrumentation/reactor-netty/reactor-netty-1.0/javaagent/src/test/java/io/opentelemetry/test/reactor/netty/TracedWithSpan.java b/instrumentation/reactor-netty/reactor-netty-1.0/javaagent/src/test/java/io/opentelemetry/test/reactor/netty/TracedWithSpan.java
new file mode 100644
index 000000000000..7a208056e28d
--- /dev/null
+++ b/instrumentation/reactor-netty/reactor-netty-1.0/javaagent/src/test/java/io/opentelemetry/test/reactor/netty/TracedWithSpan.java
@@ -0,0 +1,17 @@
+/*
+ * Copyright The OpenTelemetry Authors
+ * SPDX-License-Identifier: Apache-2.0
+ */
+
+package io.opentelemetry.test.reactor.netty;
+
+import io.opentelemetry.extension.annotations.WithSpan;
+import reactor.core.publisher.Mono;
+
+public class TracedWithSpan {
+
+  @WithSpan
+  public <T> Mono<T> mono(Mono<T> mono) {
+    return mono;
+  }
+}