diff --git a/payloads/libpayload/libc/lib.c b/payloads/libpayload/libc/lib.c
index f1d85745ad..0475789c00 100644
--- a/payloads/libpayload/libc/lib.c
+++ b/payloads/libpayload/libc/lib.c
@@ -124,8 +124,6 @@ void __noreturn abort(void)
 	halt();
 }
 
-int errno;
-
 char *getenv(const char *name)
 {
 	return NULL;
diff --git a/payloads/libpayload/libc/string.c b/payloads/libpayload/libc/string.c
index a1b7d4d59d..d641431e7d 100644
--- a/payloads/libpayload/libc/string.c
+++ b/payloads/libpayload/libc/string.c
@@ -290,7 +290,7 @@ char *strsep(char **stringp, const char *delim)
 {
 	char *walk, *token;
 
-	if (!stringp || !*stringp || !**stringp)
+	if (!stringp || !*stringp)
 		return NULL;
 
 	token = walk = *stringp;
@@ -302,11 +302,12 @@ char *strsep(char **stringp, const char *delim)
 	if (*walk) {
 		/* NUL terminate */
 		*walk = '\0';
-		walk++;
+		*stringp = walk + 1;
+	} else {
+		/* Set to NULL after last token. */
+		*stringp = NULL;
 	}
 
-	*stringp = walk;
-
 	return token;
 }
 
@@ -547,6 +548,10 @@ char *strtok(char *str, const char *delim)
 	return strtok_r(str, delim, &strtok_ptr);
 }
 
+/* errno isn't actually used anywhere other than perror() below, and just here
+   for compatibility with libc-targeting code wanting to incidentally print it. */
+int errno;
+
 /**
  * Print error message and error number
  * @param s Error message to print
diff --git a/payloads/libpayload/tests/libc/Makefile.mk b/payloads/libpayload/tests/libc/Makefile.mk
index 5f92bdf0a8..8d88af9f30 100644
--- a/payloads/libpayload/tests/libc/Makefile.mk
+++ b/payloads/libpayload/tests/libc/Makefile.mk
@@ -1,3 +1,6 @@
-tests-y += fmap_locate_area-test
+tests-y += fmap_locate_area-test string-test
 
 fmap_locate_area-test-srcs += tests/libc/fmap_locate_area-test.c
+
+string-test-srcs += tests/libc/string-test.c
+string-test-srcs += libc/string.c
diff --git a/payloads/libpayload/tests/libc/string-test.c b/payloads/libpayload/tests/libc/string-test.c
new file mode 100644
index 0000000000..2fe7c6bace
--- /dev/null
+++ b/payloads/libpayload/tests/libc/string-test.c
@@ -0,0 +1,39 @@
+/* SPDX-License-Identifier: GPL-2.0-only */
+
+#include <libpayload.h>
+#include <tests/test.h>
+
+static void test_strsep(void **state)
+{
+	/* Use `char x[] = ` instead of `char *x = ` to avoid writing to .rodata. */
+	char test1[] = "abc,def|ghi jklm,\no";
+	const char *delim = ", \n";
+
+	char *stringp = test1;
+	assert_string_equal(strsep(&stringp, delim), "abc");
+	assert_ptr_equal(stringp, test1 + 4);
+	assert_string_equal(strsep(&stringp, delim), "def|ghi");
+	assert_ptr_equal(stringp, test1 + 12);
+	assert_string_equal(strsep(&stringp, delim), "jklm");
+	assert_ptr_equal(stringp, test1 + 17);
+	assert_string_equal(strsep(&stringp, delim), "");
+	assert_ptr_equal(stringp, test1 + 18);
+	assert_string_equal(strsep(&stringp, delim), "o");
+	assert_null(stringp);
+	assert_null(strsep(&stringp, delim));
+	assert_null(stringp);
+
+	char test2[] = "";
+	stringp = test2;
+	assert_string_equal(strsep(&stringp, delim), "");
+	assert_null(strsep(&stringp, delim));
+}
+
+int main(void)
+{
+	const struct CMUnitTest tests[] = {
+		cmocka_unit_test(test_strsep),
+	};
+
+	return lp_run_group_tests(tests, NULL, NULL);
+}