diff --git a/p2p/test/muxer-negotiation/muxer_test.go b/p2p/test/muxer-negotiation/muxer_test.go
new file mode 100644
index 0000000000..a36bfbde5f
--- /dev/null
+++ b/p2p/test/muxer-negotiation/muxer_test.go
@@ -0,0 +1,126 @@
+package muxer_negotiation
+
+import (
+	"context"
+	"crypto/rand"
+	"fmt"
+	"testing"
+
+	"github.com/libp2p/go-libp2p"
+	"github.com/libp2p/go-libp2p/core/crypto"
+	"github.com/libp2p/go-libp2p/core/peer"
+	"github.com/libp2p/go-libp2p/core/protocol"
+	"github.com/libp2p/go-libp2p/core/sec/insecure"
+	"github.com/libp2p/go-libp2p/p2p/muxer/mplex"
+	"github.com/libp2p/go-libp2p/p2p/muxer/yamux"
+	"github.com/libp2p/go-libp2p/p2p/security/noise"
+	tls "github.com/libp2p/go-libp2p/p2p/security/tls"
+	"github.com/libp2p/go-libp2p/p2p/transport/tcp"
+
+	"github.com/stretchr/testify/require"
+)
+
+var (
+	yamuxOpt = libp2p.Muxer("/yamux", yamux.DefaultTransport)
+	mplexOpt = libp2p.Muxer("/mplex", mplex.DefaultTransport)
+)
+
+type testcase struct {
+	Name             string
+	ServerPreference []libp2p.Option
+	ClientPreference []libp2p.Option
+
+	Error    string
+	Expected protocol.ID
+}
+
+type security struct {
+	Name   string
+	Option libp2p.Option
+}
+
+func TestMuxerNegotiation(t *testing.T) {
+	testcases := []testcase{
+		{
+			Name:             "server and client have the same preference",
+			ServerPreference: []libp2p.Option{yamuxOpt, mplexOpt},
+			ClientPreference: []libp2p.Option{yamuxOpt, mplexOpt},
+			Expected:         "/yamux",
+		},
+		{
+			Name:             "client only supports one muxer",
+			ServerPreference: []libp2p.Option{yamuxOpt, mplexOpt},
+			ClientPreference: []libp2p.Option{yamuxOpt},
+			Expected:         "/yamux",
+		},
+		{
+			Name:             "server only supports one muxer",
+			ServerPreference: []libp2p.Option{yamuxOpt},
+			ClientPreference: []libp2p.Option{mplexOpt, yamuxOpt},
+			Expected:         "/yamux",
+		},
+		{
+			Name:             "client preference preferred",
+			ServerPreference: []libp2p.Option{yamuxOpt, mplexOpt},
+			ClientPreference: []libp2p.Option{mplexOpt, yamuxOpt},
+			Expected:         "/mplex",
+		},
+		{
+			Name:             "no preference overlap",
+			ServerPreference: []libp2p.Option{yamuxOpt},
+			ClientPreference: []libp2p.Option{mplexOpt},
+			Error:            "failed to negotiate stream multiplexer: protocol not supported",
+		},
+	}
+
+	clientID, _, err := crypto.GenerateEd25519Key(rand.Reader)
+	require.NoError(t, err)
+	serverID, _, err := crypto.GenerateEd25519Key(rand.Reader)
+	require.NoError(t, err)
+
+	securities := []security{
+		{Name: "noise", Option: libp2p.Security("/noise", noise.New)},
+		{Name: "tls", Option: libp2p.Security("/tls", tls.New)},
+		{Name: "insecure", Option: libp2p.Security("/insecure", insecure.NewWithIdentity)},
+	}
+
+	for _, tc := range testcases {
+		tc := tc
+
+		for _, sec := range securities {
+			sec := sec
+
+			t.Run(fmt.Sprintf("%s: %s", sec.Name, tc.Name), func(t *testing.T) {
+				server, err := libp2p.New(
+					libp2p.Identity(serverID),
+					sec.Option,
+					libp2p.ChainOptions(tc.ServerPreference...),
+					libp2p.Transport(tcp.NewTCPTransport),
+					libp2p.ListenAddrStrings("/ip4/127.0.0.1/tcp/0"),
+				)
+				require.NoError(t, err)
+
+				client, err := libp2p.New(
+					libp2p.Identity(clientID),
+					sec.Option,
+					libp2p.ChainOptions(tc.ClientPreference...),
+					libp2p.Transport(tcp.NewTCPTransport),
+					libp2p.NoListenAddrs,
+				)
+				require.NoError(t, err)
+
+				err = client.Connect(context.Background(), peer.AddrInfo{ID: server.ID(), Addrs: server.Addrs()})
+				if tc.Error != "" {
+					require.Error(t, err)
+					require.ErrorContains(t, err, tc.Error)
+					return
+				}
+
+				require.NoError(t, err)
+				conns := client.Network().ConnsToPeer(server.ID())
+				require.Len(t, conns, 1, "expected exactly one connection")
+				require.Equal(t, tc.Expected, protocol.ID(conns[0].ConnState().NextProto))
+			})
+		}
+	}
+}