diff --git a/History.md b/History.md
index 525ae45c..1e7b58d3 100644
--- a/History.md
+++ b/History.md
@@ -31,6 +31,7 @@
   * Set `Connection: closed` header when queue requests is disabled (#2216)
   * Pass queued requests to thread pool on server shutdown (#2122)
   * Fixed a few minor concurrency bugs in ThreadPool that may have affected non-GVL Rubies (#2220)
+  * Fix `out_of_band` hook never executed if the number of worker threads is > 1 (#2177)
 
 * Refactor
   * Remove unused loader argument from Plugin initializer (#2095)
diff --git a/lib/puma/server.rb b/lib/puma/server.rb
index f590d528..b5269f0d 100644
--- a/lib/puma/server.rb
+++ b/lib/puma/server.rb
@@ -288,10 +288,7 @@ module Puma
                     end
 
                     pool << client
-                    busy_threads = pool.wait_until_not_full
-                    if busy_threads == 0
-                      @options[:out_of_band].each(&:call) if @options[:out_of_band]
-                    end
+                    pool.wait_until_not_full
                   end
                 rescue SystemCallError
                   # nothing
@@ -439,6 +436,12 @@ module Puma
         rescue StandardError => e
           @events.unknown_error self, e, "Client"
         end
+
+        if @options[:out_of_band]
+          @thread_pool.with_mutex do
+            @options[:out_of_band].each(&:call) if @thread_pool.busy_threads == 1
+          end
+        end
       end
     end
 
diff --git a/lib/puma/thread_pool.rb b/lib/puma/thread_pool.rb
index c0d9c543..54b1407a 100644
--- a/lib/puma/thread_pool.rb
+++ b/lib/puma/thread_pool.rb
@@ -82,6 +82,10 @@ module Puma
       waiting + (@max - spawned)
     end
 
+    def busy_threads
+      with_mutex { @spawned - @waiting + @todo.size }
+    end
+
     # :nodoc:
     #
     # Must be called with @mutex held!
@@ -188,9 +192,6 @@ module Puma
     # method would not block and another request would be added into the reactor
     # by the server. This would continue until a fully bufferend request
     # makes it through the reactor and can then be processed by the thread pool.
-    #
-    # Returns the current number of busy threads, or +nil+ if shutting down.
-    #
     def wait_until_not_full
       with_mutex do
         while true
@@ -200,8 +201,7 @@ module Puma
           # is work queued that cannot be handled by waiting
           # threads, then accept more work until we would
           # spin up the max number of threads.
-          busy_threads = @spawned - @waiting + @todo.size
-          return busy_threads if @max > busy_threads
+          return if busy_threads < @max
 
           @not_full.wait @mutex
         end
diff --git a/test/test_puma_server.rb b/test/test_puma_server.rb
index b97c6196..f392ae32 100644
--- a/test/test_puma_server.rb
+++ b/test/test_puma_server.rb
@@ -984,4 +984,85 @@ EOF
     assert_equal ["HTTP/1.0 200 OK", "Content-Length: 0"], header(sock)
     sock.close
   end
+
+  def oob_server(**options)
+    @request_count = 0
+    @oob_count = 0
+    @start = Time.now
+    in_oob = Mutex.new
+    @mutex = Mutex.new
+    @oob_finished = ConditionVariable.new
+    oob_wait = options.delete(:oob_wait)
+    oob = -> do
+      in_oob.synchronize do
+        @mutex.synchronize do
+          @oob_count += 1
+          @oob_finished.signal
+          @oob_finished.wait(@mutex, 1) if oob_wait
+        end
+      end
+    end
+    @server = Puma::Server.new @app, @events, out_of_band: [oob], **options
+    @server.min_threads = 5
+    @server.max_threads = 5
+    server_run app: ->(_) do
+      raise 'OOB conflict' if in_oob.locked?
+      @mutex.synchronize {@request_count += 1}
+      [200, {}, [""]]
+    end
+  end
+
+  # Sequential requests should trigger out_of_band hooks after every request.
+  def test_out_of_band
+    n = 100
+    oob_server queue_requests: false
+    n.times do
+      @mutex.synchronize do
+        send_http "GET / HTTP/1.0\r\n\r\n"
+        @oob_finished.wait(@mutex, 1)
+      end
+    end
+    assert_equal n, @request_count
+    assert_equal n, @oob_count
+  end
+
+  # Streaming requests on parallel connections without delay should trigger
+  # out_of_band hooks only once after the final request.
+  def test_out_of_band_stream
+    n = 100
+    threads = 10
+    oob_server
+    req = "GET / HTTP/1.1\r\n"
+    @mutex.synchronize do
+      Array.new(threads) do
+        Thread.new do
+          send_http "#{req}\r\n" * (n/threads-1) + "#{req}Connection: close\r\n\r\n"
+        end
+      end.each(&:join)
+      @oob_finished.wait(@mutex, 1)
+    end
+    assert_equal n, @request_count
+    assert_equal 1, @oob_count
+  end
+
+  def test_out_of_band_overlapping_requests
+    oob_server oob_wait: true
+    sock = nil
+    sock2 = nil
+    @mutex.synchronize do
+      sock2 = send_http "GET / HTTP/1.0\r\n"
+      sleep 0.01
+      sock = send_http "GET / HTTP/1.0\r\n\r\n"
+      # Request 1 processed
+      @oob_finished.wait(@mutex) # enter oob
+      sock2 << "\r\n"
+      sleep 0.01
+      @oob_finished.signal # exit oob
+      # Request 2 processed
+      @oob_finished.wait(@mutex) # enter oob
+      @oob_finished.signal # exit oob
+    end
+    assert_match(/200/, sock.read)
+    assert_match(/200/, sock2.read)
+  end
 end