diff --git a/docs/debugging.md b/docs/debugging.md
index 50d4b1eb8..07cb210aa 100644
--- a/docs/debugging.md
+++ b/docs/debugging.md
@@ -120,7 +120,7 @@ For automated debugging without modifying test code, use the `pause` plugin. It
 
 ### Pause on Failure
 
-Automatically enters interactive pause when a step fails:
+Automatically enters interactive pause when a test fails. A step that fails inside `tryTo`, `hopeThat` or `retryTo` does not trigger it while the test keeps passing:
 
 ```bash
 npx codeceptjs run -p pause
diff --git a/lib/plugin/pause.js b/lib/plugin/pause.js
index 9bec1cfe7..46fc4ea9e 100644
--- a/lib/plugin/pause.js
+++ b/lib/plugin/pause.js
@@ -27,7 +27,8 @@ import {
  *
  * #### `on=` modes
  *
- * * **fail** — pause when a step fails (default)
+ * * **fail** — pause after a test fails (default). Steps that fail inside
+ *   `tryTo`, `hopeThat` or `retryTo` without failing the test do not trigger a pause
  * * **test** — pause after each test
  * * **step** — pause before the first step (interactive walk-through)
  * * **file** — pause when execution reaches `path=...[;line=...]`
@@ -68,7 +69,7 @@ function initFailMode() {
     failed = false
   })
 
-  event.dispatcher.on(event.step.failed, () => {
+  event.dispatcher.on(event.test.failed, () => {
     failed = true
   })
 
diff --git a/test/unit/plugin/pause_test.js b/test/unit/plugin/pause_test.js
new file mode 100644
index 000000000..48eac3f27
--- /dev/null
+++ b/test/unit/plugin/pause_test.js
@@ -0,0 +1,139 @@
+import { expect } from 'chai'
+import pausePlugin from '../../../lib/plugin/pause.js'
+import { setPauseHandler } from '../../../lib/pause.js'
+import { hopeThat, retryTo, tryTo } from '../../../lib/effects.js'
+import recordStep from '../../../lib/step/record.js'
+import Step from '../../../lib/step.js'
+import event from '../../../lib/event.js'
+import recorder from '../../../lib/recorder.js'
+import store from '../../../lib/store.js'
+import { createTest } from '../../../lib/mocha/test.js'
+
+const trackedEvents = [event.test.before, event.test.started, event.test.failed, event.test.after, event.step.failed]
+
+const failingStep = () => recordStep(new Step({ fail: () => Promise.reject(new Error('Ups')) }, 'fail'), [])
+
+describe('pause plugin on=fail', () => {
+  let pauses
+  let listenersBefore
+
+  beforeEach(() => {
+    store.dryRun = false
+    pauses = 0
+    setPauseHandler(() => {
+      pauses++
+      return Promise.resolve()
+    })
+    listenersBefore = Object.fromEntries(trackedEvents.map(name => [name, event.dispatcher.listeners(name)]))
+    recorder.reset()
+    recorder.start()
+    pausePlugin({})
+  })
+
+  afterEach(() => {
+    for (const name of trackedEvents) {
+      for (const listener of event.dispatcher.listeners(name)) {
+        if (!listenersBefore[name].includes(listener)) event.dispatcher.removeListener(name, listener)
+      }
+    }
+    event.dispatcher.emit(event.test.finished, createTest('cleanup'))
+    setPauseHandler(null)
+    recorder.reset()
+  })
+
+  const finishTest = async test => {
+    event.dispatcher.emit(event.test.finished, test)
+    event.dispatcher.emit(event.test.after, test)
+    await recorder.promise()
+  }
+
+  it('does not pause when a step failure is swallowed by tryTo (#4516)', async () => {
+    const test = createTest('tryTo')
+    event.dispatcher.emit(event.test.started, test)
+    const result = await tryTo(failingStep)
+    await recorder.promise()
+    expect(result).to.equal(false)
+    event.dispatcher.emit(event.test.passed, test)
+    await finishTest(test)
+    expect(pauses).to.equal(0)
+  })
+
+  it('does not pause when a step failure is swallowed by hopeThat', async () => {
+    const test = createTest('hopeThat')
+    event.dispatcher.emit(event.test.started, test)
+    const result = await hopeThat(failingStep)
+    await recorder.promise()
+    expect(result).to.equal(false)
+    event.dispatcher.emit(event.test.passed, test)
+    await finishTest(test)
+    expect(pauses).to.equal(0)
+  })
+
+  it('does not pause when retryTo succeeds after a failed attempt', async () => {
+    const test = createTest('retryTo')
+    event.dispatcher.emit(event.test.started, test)
+    await retryTo(tries => (tries === 1 ? failingStep() : recorder.add(() => 'ok')), 2, 0)
+    await recorder.promise()
+    event.dispatcher.emit(event.test.passed, test)
+    await finishTest(test)
+    expect(pauses).to.equal(0)
+  })
+
+  it('pauses when a failed step fails the test', async () => {
+    const test = createTest('failing step')
+    event.dispatcher.emit(event.test.started, test)
+    const err = await failingStep().catch(e => e)
+    recorder.reset()
+    recorder.start()
+    event.dispatcher.emit(event.test.failed, test, err)
+    await finishTest(test)
+    expect(pauses).to.equal(1)
+  })
+
+  it('pauses when a Before hook fails', async () => {
+    const test = createTest('before hook')
+    event.dispatcher.emit(event.test.before, test)
+    const err = await failingStep().catch(e => e)
+    recorder.reset()
+    recorder.start()
+    event.dispatcher.emit(event.test.failed, test, err, 'Before')
+    await finishTest(test)
+    expect(pauses).to.equal(1)
+  })
+
+  it('pauses when an After hook fails a passed test', async () => {
+    const test = createTest('after hook')
+    event.dispatcher.emit(event.test.started, test)
+    event.dispatcher.emit(event.test.passed, test)
+    const err = await failingStep().catch(e => e)
+    recorder.reset()
+    recorder.start()
+    event.dispatcher.emit(event.test.failed, test, err, 'After')
+    await finishTest(test)
+    expect(pauses).to.equal(1)
+  })
+
+  it('pauses when the test fails without a failed step', async () => {
+    const test = createTest('plain error')
+    event.dispatcher.emit(event.test.started, test)
+    event.dispatcher.emit(event.test.failed, test, new Error('Ups'))
+    await finishTest(test)
+    expect(pauses).to.equal(1)
+  })
+
+  it('does not carry a failure over to the next test', async () => {
+    const failed = createTest('failed')
+    event.dispatcher.emit(event.test.started, failed)
+    const err = await failingStep().catch(e => e)
+    recorder.reset()
+    recorder.start()
+    event.dispatcher.emit(event.test.failed, failed, err)
+    await finishTest(failed)
+
+    const passed = createTest('passed')
+    event.dispatcher.emit(event.test.started, passed)
+    event.dispatcher.emit(event.test.passed, passed)
+    await finishTest(passed)
+    expect(pauses).to.equal(1)
+  })
+})