diff --git a/src/apply/arity.xsl b/src/apply/arity.xsl
index 5e9de23..ad24032 100644
--- a/src/apply/arity.xsl
+++ b/src/apply/arity.xsl
@@ -28,21 +28,28 @@
 
 
 <!--
-  Attempt to retrieve arity of dynamic function
+  Attempt to retrieve arity of dynamic function @var{fnref}
 
-  The input must be a function reference.  Partially applied function
-  references will have an arity equivalent to the remaining parameters
-  in the original function.
-
-  If the arity cannot be determined, -1 is returned.
+  @var{fnref} must be a dynamic function reference satisfying
+  @code{f:is-ref}.  Partially applied function references will have an
+  arity equivalent to the free parameters in the target function.
 -->
-<function name="f:arity" as="xs:decimal">
-  <param name="fnref" as="element(f:ref)" />
+<function name="f:arity" as="xs:integer">
+  <param name="fnref" as="item()+" />
 
-  <sequence select="if ( $fnref/@arity ) then
-                      $fnref/@arity
+  <variable name="ref" as="element( f:ref )"
+            select="$fnref[ 1 ]" />
+
+  <variable name="arity" as="xs:integer"
+            select="$ref/@arity" />
+
+  <variable name="partial" as="xs:integer"
+            select="if ( $ref/@partial ) then
+                      $ref/@partial
                     else
-                      -1" />
+                      0" />
+
+  <sequence select="$arity - $partial" />
 </function>
 
 </stylesheet>
diff --git a/src/apply/partial.xsl b/src/apply/partial.xsl
index 2208a95..3953377 100644
--- a/src/apply/partial.xsl
+++ b/src/apply/partial.xsl
@@ -71,12 +71,15 @@
     <sequence select="$args" />
   </variable>
 
-  <variable name="argn" as="xs:decimal"
-            select="count( $argout )" />
-
-  <variable name="arity" as="xs:decimal"
+  <!-- note that, if FNREF is partially applied, then this arity
+       represents the arity of the partially applied function, _not_
+       the target function -->
+  <variable name="arity" as="xs:integer"
             select="f:arity( $ref )" />
 
+  <variable name="argn" as="xs:integer"
+            select="count( $args )" />
+
   <choose>
     <when test="$argn eq $arity">
       <sequence select="_f:apply-partial( $ref, $argout )" />
@@ -87,7 +90,7 @@
                        select="$ref">
         <with-param name="args"  select="$argout" />
         <with-param name="arity" select="$arity" />
-        <with-param name="argn"  select="$argn" />
+        <with-param name="argn"  select="count( $argout )" />
       </apply-templates>
     </when>
 
@@ -96,7 +99,7 @@
         <sequence select="$ref/@*" />
 
         <attribute name="partial"
-                   select="count( $args )" />
+                   select="count( $argout )" />
 
         <sequence select="$ref/*" />
       </f:ref>
diff --git a/test/apply/arity.xspec b/test/apply/arity.xspec
index 1fe892f..a09198f 100644
--- a/test/apply/arity.xspec
+++ b/test/apply/arity.xspec
@@ -31,6 +31,13 @@
             select="namespace-uri-for-prefix(
                       'foo', root(.)/element() )" />
 
+  <variable name="test-arity"
+            select="5" />
+
+  <variable name="test-fn"
+            select="f:make-ref( QName( $foo-uri, 'foo:bar' ),
+                                $test-arity )" />
+
 
   <scenario label="f:arity">
     <scenario label="given a proper function reference">
@@ -39,32 +46,38 @@
 
       <!-- test our format directly; do not rely on the
            apply-gen code -->
-      <variable name="fnref"
-                select="f:make-ref( QName( $foo-uri, 'foo:bar' ),
-                                    $test-arity )" />
-
       <call function="f:arity">
-        <param name="fnref"
-               select="$fnref" />
+        <param name="fnref" select="$test-fn" />
       </call>
 
       <expect label="provides function arity"
-              test="$x:result = $test-arity" />
+              select="$test-arity" />
     </scenario>
 
 
-    <scenario label="given a function reference with no defined arity">
-      <variable name="fnref">
-        <f:ref><foo:bar /></f:ref>
-      </variable>
-
+    <scenario label="given a partially applied function reference">
       <call function="f:arity">
         <param name="fnref"
-               select="$fnref" />
+               select="f:apply( $test-fn, 1, 2 )" />
       </call>
 
-      <expect label="returns -1"
-              test="$x:result = -1" />
+      <expect label="provides arity of the target function minus the
+                     number of bound parameters"
+              select="$test-arity - 2" />
+    </scenario>
+
+
+    <scenario label="given a multiply-partially-applied function reference">
+      <call function="f:arity">
+        <param name="fnref"
+               select="f:apply(
+                         f:apply( $test-fn, 1, 2 ),
+                         3 )" />
+      </call>
+
+      <expect label="provides arity of the target function minus the
+                     number of bound parameters"
+              select="$test-arity - 3" />
     </scenario>
   </scenario>
 </description>