diff --git a/include/net/bluetooth/hci_core.h b/include/net/bluetooth/hci_core.h
index f07b1450b3c2..3c7827005c25 100644
--- a/include/net/bluetooth/hci_core.h
+++ b/include/net/bluetooth/hci_core.h
@@ -75,6 +75,7 @@ struct discovery_state {
 	u32			last_adv_flags;
 	u8			last_adv_data[HCI_MAX_AD_LENGTH];
 	u8			last_adv_data_len;
+	bool			report_invalid_rssi;
 	s8			rssi;
 	u16			uuid_count;
 	u8			(*uuids)[16];
@@ -506,11 +507,13 @@ static inline void discovery_init(struct hci_dev *hdev)
 	INIT_LIST_HEAD(&hdev->discovery.all);
 	INIT_LIST_HEAD(&hdev->discovery.unknown);
 	INIT_LIST_HEAD(&hdev->discovery.resolve);
+	hdev->discovery.report_invalid_rssi = true;
 	hdev->discovery.rssi = HCI_RSSI_INVALID;
 }
 
 static inline void hci_discovery_filter_clear(struct hci_dev *hdev)
 {
+	hdev->discovery.report_invalid_rssi = true;
 	hdev->discovery.rssi = HCI_RSSI_INVALID;
 	hdev->discovery.uuid_count = 0;
 	kfree(hdev->discovery.uuids);
diff --git a/net/bluetooth/mgmt.c b/net/bluetooth/mgmt.c
index 3ca2818d1c8b..a91e484886fe 100644
--- a/net/bluetooth/mgmt.c
+++ b/net/bluetooth/mgmt.c
@@ -3912,6 +3912,7 @@ static int start_discovery(struct sock *sk, struct hci_dev *hdev,
 	hci_discovery_filter_clear(hdev);
 
 	hdev->discovery.type = cp->type;
+	hdev->discovery.report_invalid_rssi = false;
 
 	hci_req_init(&req, hdev);
 
@@ -7022,8 +7023,15 @@ void mgmt_device_found(struct hci_dev *hdev, bdaddr_t *bdaddr, u8 link_type,
 
 	memset(buf, 0, sizeof(buf));
 
-	/* Reset invalid RSSI to 0 to keep backwards API compliance */
-	if (rssi == HCI_RSSI_INVALID)
+	/* In case of device discovery with BR/EDR devices (pre 1.2), the
+	 * RSSI value was reported as 0 when not available. This behavior
+	 * is kept when using device discovery. This is required for full
+	 * backwards compatibility with the API.
+	 *
+	 * However when using service discovery, the value 127 will be
+	 * returned when the RSSI is not available.
+	 */
+	if (rssi == HCI_RSSI_INVALID && !hdev->discovery.report_invalid_rssi)
 		rssi = 0;
 
 	bacpy(&ev->addr.bdaddr, bdaddr);