diff --git a/rustler/src/lib.rs b/rustler/src/lib.rs
index 637aff7c..ce700ef6 100644
--- a/rustler/src/lib.rs
+++ b/rustler/src/lib.rs
@@ -38,7 +38,8 @@ mod term;
 
 pub use crate::term::Term;
 pub use crate::types::{
-    Atom, Binary, Decoder, Encoder, ListIterator, LocalPid, MapIterator, NewBinary, OwnedBinary,
+    Atom, Binary, Decoder, Encoder, ErlOption, ListIterator, LocalPid, MapIterator, NewBinary,
+    OwnedBinary,
 };
 pub mod resource;
 pub use crate::resource::ResourceArc;
diff --git a/rustler/src/types/atom.rs b/rustler/src/types/atom.rs
index 13fcaf23..b51f2bf7 100644
--- a/rustler/src/types/atom.rs
+++ b/rustler/src/types/atom.rs
@@ -271,6 +271,10 @@ atoms! {
     /// The `nil` atom.
     nil,
 
+    /// The `undefined` atom, commonly used in Erlang libraries to express the
+    /// absence of value.
+    undefined,
+
     /// The `ok` atom, commonly used in success tuples.
     ok,
 
diff --git a/rustler/src/types/erlang_option.rs b/rustler/src/types/erlang_option.rs
new file mode 100644
index 00000000..97fd9eec
--- /dev/null
+++ b/rustler/src/types/erlang_option.rs
@@ -0,0 +1,216 @@
+use super::atom;
+use crate::{Decoder, Encoder, Env, Error, NifResult, Term};
+
+use std::ops::{Deref, DerefMut};
+
+/// A wrapper type for [`Option<T>`][option] to provide Erlang style encoding. It
+/// uses `undefined` atom instead of `nil` when the enclosing value is `None`.
+///
+/// Useful for interacting with Erlang libraries as `undefined` is commonly used in
+/// Erlang to represent the absence of a value.
+///
+/// [option]: https://doc.rust-lang.org/stable/core/option/enum.Option.html
+///
+/// # Examples
+///
+/// `ErlOption<T>` provides methods to convert to/from `Option<T>`.
+///
+/// ```rust
+/// use rustler::ErlOption;
+///
+/// // Create new `ErlOption<i32>` values via convenient functions.
+/// let _ = ErlOption::some(1); // Wraps `Some(1)`.
+/// let _ = ErlOption::<i32>::none();
+///
+/// // Convert Option<i32> values to ErlOption<i32> values.
+/// let _ = ErlOption::from(Some(2));
+/// let _: ErlOption<_> = Some(3).into();
+/// let _: ErlOption<i32> = None.into();
+///
+/// // Get a reference of enclosing Option<T> from an ErlOption<T>.
+/// let _: &Option<i32> = ErlOption::some(4).as_ref();
+///
+/// // Get a mutable reference of enclosing Option<T> from an ErlOption<T>.
+/// let _: &mut Option<i32> = ErlOption::some(5).as_mut();
+///
+/// // Convert an ErlOption<i32> value to an Option<i32> value.
+/// let _: Option<i32> = ErlOption::some(6).into();
+///
+/// // Compare ErlOption<T> with Option<T>.
+/// assert_eq!(ErlOption::some(7), Some(7));
+/// assert!(ErlOption::some(8) > Some(7));
+///
+/// // Call Option<T>'s methods on an ErlOption<T> via Deref and DerefMut.
+/// assert!(ErlOption::some(9).is_some());
+/// assert_eq!(ErlOption::some(10).unwrap(), 10);
+/// assert_eq!(ErlOption::some(12).map(|v| v + 1), ErlOption::some(13));
+/// ```
+///
+#[derive(Copy, Clone, Debug, PartialEq, Eq, PartialOrd, Ord, Hash)]
+pub struct ErlOption<T>(Option<T>);
+
+impl<T> ErlOption<T> {
+    /// A convenience function to create an `ErlOption<T>` from a `Some(T)` value.
+    pub fn some(v: T) -> Self {
+        Some(v).into()
+    }
+
+    /// A convenience function to create an `ErlOption<T>` enclosing the `None`
+    /// value.
+    pub fn none() -> Self {
+        Default::default()
+    }
+}
+
+// NOTE: Manually implement the Default instead of deriving it. This is because
+// deriving requires `T` to be `Default` as well, but we do not need that.
+impl<T> Default for ErlOption<T> {
+    fn default() -> Self {
+        Self(None)
+    }
+}
+
+impl<T> From<Option<T>> for ErlOption<T> {
+    fn from(v: Option<T>) -> Self {
+        ErlOption(v)
+    }
+}
+
+impl<T> From<ErlOption<T>> for Option<T> {
+    fn from(v: ErlOption<T>) -> Self {
+        v.0
+    }
+}
+
+impl<T> AsMut<Option<T>> for ErlOption<T> {
+    fn as_mut(&mut self) -> &mut Option<T> {
+        &mut self.0
+    }
+}
+
+impl<T> AsRef<Option<T>> for ErlOption<T> {
+    fn as_ref(&self) -> &Option<T> {
+        &self.0
+    }
+}
+
+impl<T> Deref for ErlOption<T> {
+    type Target = Option<T>;
+
+    fn deref(&self) -> &Self::Target {
+        &self.0
+    }
+}
+
+impl<T> DerefMut for ErlOption<T> {
+    fn deref_mut(&mut self) -> &mut Self::Target {
+        &mut self.0
+    }
+}
+
+impl<T> PartialEq<Option<T>> for ErlOption<T>
+where
+    T: PartialEq,
+{
+    fn eq(&self, other: &Option<T>) -> bool {
+        &self.0 == other
+    }
+}
+
+impl<T> PartialEq<ErlOption<T>> for Option<T>
+where
+    T: PartialEq,
+{
+    fn eq(&self, other: &ErlOption<T>) -> bool {
+        self == &other.0
+    }
+}
+
+impl<T> PartialOrd<Option<T>> for ErlOption<T>
+where
+    T: PartialOrd,
+{
+    fn partial_cmp(&self, other: &Option<T>) -> Option<std::cmp::Ordering> {
+        self.0.partial_cmp(other)
+    }
+}
+
+impl<T> PartialOrd<ErlOption<T>> for Option<T>
+where
+    T: PartialOrd,
+{
+    fn partial_cmp(&self, other: &ErlOption<T>) -> Option<std::cmp::Ordering> {
+        self.partial_cmp(&other.0)
+    }
+}
+
+impl<T> Encoder for ErlOption<T>
+where
+    T: Encoder,
+{
+    fn encode<'c>(&self, env: Env<'c>) -> Term<'c> {
+        match self.0 {
+            Some(ref value) => value.encode(env),
+            None => atom::undefined().encode(env),
+        }
+    }
+}
+
+impl<'a, T> Decoder<'a> for ErlOption<T>
+where
+    T: Decoder<'a>,
+{
+    fn decode(term: Term<'a>) -> NifResult<Self> {
+        if let Ok(term) = term.decode::<T>() {
+            Ok(Self(Some(term)))
+        } else {
+            let decoded_atom: atom::Atom = term.decode()?;
+            if decoded_atom == atom::undefined() {
+                Ok(Self(None))
+            } else {
+                Err(Error::BadArg)
+            }
+        }
+    }
+}
+
+#[cfg(test)]
+mod test {
+    use super::ErlOption;
+
+    #[test]
+    fn test_creations() {
+        assert_eq!(ErlOption::some(1).as_ref(), &Some(1));
+        assert_eq!(ErlOption::<i32>::none().as_ref(), &None as &Option<i32>);
+    }
+
+    #[test]
+    fn test_conversions() {
+        // Convert Option<i32> values to ErlOption<i32> values.
+        assert_eq!(ErlOption::from(Some(2)), ErlOption::some(2));
+        assert_eq!(Into::<ErlOption<i32>>::into(Some(3)), ErlOption::some(3));
+        assert_eq!(Into::<ErlOption<i32>>::into(None), ErlOption::none());
+
+        // Convert an ErlOption<i32> value to an Option<i32> value.
+        assert_eq!(Into::<Option<i32>>::into(ErlOption::some(6)), Some(6));
+    }
+
+    #[test]
+    fn test_as_ref() {
+        assert_eq!(ErlOption::some(4).as_ref(), &Some(4));
+        assert_eq!(ErlOption::some(5).as_mut(), &mut Some(5));
+    }
+
+    #[test]
+    fn test_compare() {
+        assert_eq!(ErlOption::some(7), Some(7));
+        assert!(ErlOption::some(8) > Some(7));
+    }
+
+    #[test]
+    fn test_deref() {
+        assert!(ErlOption::some(9).is_some());
+        assert_eq!(ErlOption::some(10).unwrap(), 10);
+        assert_eq!(ErlOption::some(12).map(|v| v + 1), ErlOption::some(13));
+    }
+}
diff --git a/rustler/src/types/mod.rs b/rustler/src/types/mod.rs
index bd1d5364..5aa0393e 100644
--- a/rustler/src/types/mod.rs
+++ b/rustler/src/types/mod.rs
@@ -37,6 +37,9 @@ pub mod truthy;
 
 pub mod elixir_struct;
 
+pub mod erlang_option;
+pub use self::erlang_option::ErlOption;
+
 pub trait Encoder {
     fn encode<'a>(&self, env: Env<'a>) -> Term<'a>;
 }
diff --git a/rustler_tests/lib/rustler_test.ex b/rustler_tests/lib/rustler_test.ex
index f8d016c4..0d8bb277 100644
--- a/rustler_tests/lib/rustler_test.ex
+++ b/rustler_tests/lib/rustler_test.ex
@@ -25,6 +25,7 @@ defmodule RustlerTest do
   def add_i32(_, _), do: err()
   def echo_u8(_), do: err()
   def option_inc(_), do: err()
+  def erlang_option_inc(_), do: err()
   def result_to_int(_), do: err()
 
   def sum_list(_), do: err()
diff --git a/rustler_tests/native/rustler_test/src/lib.rs b/rustler_tests/native/rustler_test/src/lib.rs
index 0a52d18b..03a744d3 100644
--- a/rustler_tests/native/rustler_test/src/lib.rs
+++ b/rustler_tests/native/rustler_test/src/lib.rs
@@ -21,6 +21,7 @@ rustler::init!(
         test_primitives::add_i32,
         test_primitives::echo_u8,
         test_primitives::option_inc,
+        test_primitives::erlang_option_inc,
         test_primitives::result_to_int,
         test_list::sum_list,
         test_list::make_list,
diff --git a/rustler_tests/native/rustler_test/src/test_primitives.rs b/rustler_tests/native/rustler_test/src/test_primitives.rs
index 922c452b..bcee1673 100644
--- a/rustler_tests/native/rustler_test/src/test_primitives.rs
+++ b/rustler_tests/native/rustler_test/src/test_primitives.rs
@@ -1,3 +1,5 @@
+use rustler::ErlOption;
+
 #[rustler::nif]
 pub fn add_u32(a: u32, b: u32) -> u32 {
     a + b
@@ -18,6 +20,11 @@ pub fn option_inc(opt: Option<f64>) -> Option<f64> {
     opt.map(|num| num + 1.0)
 }
 
+#[rustler::nif]
+pub fn erlang_option_inc(opt: ErlOption<f64>) -> ErlOption<f64> {
+    opt.as_ref().map(|num| num + 1.0).into()
+}
+
 #[rustler::nif]
 pub fn result_to_int(res: Result<bool, &str>) -> Result<usize, String> {
     match res {
diff --git a/rustler_tests/test/primitives_test.exs b/rustler_tests/test/primitives_test.exs
index b37d355f..3462ace8 100644
--- a/rustler_tests/test/primitives_test.exs
+++ b/rustler_tests/test/primitives_test.exs
@@ -20,6 +20,12 @@ defmodule RustlerTest.PrimitivesTest do
     assert_raise ArgumentError, fn -> RustlerTest.option_inc("hello") end
   end
 
+  test "erlang option decoding and encoding" do
+    assert 33.0 == RustlerTest.erlang_option_inc(32.0)
+    assert :undefined == RustlerTest.erlang_option_inc(:undefined)
+    assert_raise ArgumentError, fn -> RustlerTest.erlang_option_inc("hello") end
+  end
+
   test "result decoding and encoding" do
     assert {:ok, 1} == RustlerTest.result_to_int({:ok, true})
     assert {:ok, 0} == RustlerTest.result_to_int({:ok, false})