diff --git a/lib/web/fetch/index.js b/lib/web/fetch/index.js
index 435eafdf15f..aad6c54ec5a 100644
--- a/lib/web/fetch/index.js
+++ b/lib/web/fetch/index.js
@@ -65,8 +65,6 @@ const { webidl } = require('./webidl')
 const { STATUS_CODES } = require('node:http')
 const GET_OR_HEAD = ['GET', 'HEAD']
 
-const noop = () => {}
-
 const defaultUserAgent = typeof __UNDICI_IS_NODE__ !== 'undefined' || typeof esbuildDetection !== 'undefined'
   ? 'node'
   : 'undici'
@@ -2060,7 +2058,7 @@ async function httpNetworkFetch (
 
   function dispatch ({ body }) {
     const url = requestCurrentURL(request)
-    /** @type {import('../..').Agent} */
+    /** @type {import('../../..').Agent} */
     const agent = fetchParams.controller.dispatcher
 
     return new Promise((resolve, reject) => agent.dispatch(
@@ -2074,6 +2072,9 @@ async function httpNetworkFetch (
         upgrade: request.mode === 'websocket' ? 'websocket' : undefined
       },
       {
+        /**
+         * @type {import('node:stream').Readable|null}
+         */
         body: null,
         abort: null,
 
@@ -2114,35 +2115,37 @@ async function httpNetworkFetch (
 
           /** @type {string[]} */
           let codings = []
-          let location = ''
 
           const headersList = new HeadersList()
 
           for (let i = 0; i < rawHeaders.length; i += 2) {
             headersList.append(bufferToLowerCasedHeaderName(rawHeaders[i]), rawHeaders[i + 1].toString('latin1'), true)
           }
+
           const contentEncoding = headersList.get('content-encoding', true)
           if (contentEncoding) {
             // https://www.rfc-editor.org/rfc/rfc7231#section-3.1.2.1
             // "All content-coding values are case-insensitive..."
             codings = contentEncoding.toLowerCase().split(',').map((x) => x.trim())
           }
-          location = headersList.get('location', true)
 
           this.body = new Readable({ read: resume })
 
-          const decoders = []
+          /** @type {[src: import('node:stream').Readable, ...target: import('node:stream').Writable[]]} */
+          let streams
 
-          const willFollow = location && request.redirect === 'follow' &&
-            redirectStatusSet.has(status)
+          const willFollow = request.redirect === 'follow' &&
+            redirectStatusSet.has(status) &&
+            headersList.get('location', true)
 
           // https://developer.mozilla.org/en-US/docs/Web/HTTP/Headers/Content-Encoding
           if (codings.length !== 0 && request.method !== 'HEAD' && request.method !== 'CONNECT' && !nullBodyStatus.includes(status) && !willFollow) {
+            streams = [this.body]
             for (let i = codings.length - 1; i >= 0; --i) {
               const coding = codings[i]
               // https://www.rfc-editor.org/rfc/rfc9112.html#section-7.2
               if (coding === 'x-gzip' || coding === 'gzip') {
-                decoders.push(zlib.createGunzip({
+                streams.push(zlib.createGunzip({
                   // Be less strict when decoding compressed responses, since sometimes
                   // servers send slightly invalid responses that are still accepted
                   // by common browsers.
@@ -2151,23 +2154,38 @@ async function httpNetworkFetch (
                   finishFlush: zlib.constants.Z_SYNC_FLUSH
                 }))
               } else if (coding === 'deflate') {
-                decoders.push(createInflate())
+                streams.push(createInflate({
+                  flush: zlib.constants.Z_SYNC_FLUSH,
+                  finishFlush: zlib.constants.Z_SYNC_FLUSH
+                }))
               } else if (coding === 'br') {
-                decoders.push(zlib.createBrotliDecompress())
+                streams.push(zlib.createBrotliDecompress({
+                  flush: zlib.constants.BROTLI_OPERATION_FLUSH,
+                  finishFlush: zlib.constants.BROTLI_OPERATION_FLUSH
+                }))
               } else {
-                decoders.length = 0
+                // If the server sends the payload with a coding which his not
+                // supported, the body will be passed through without decoding.
+                streams = undefined
                 break
               }
             }
           }
 
+          const onError = this.onError.bind(this)
+          const callback = (err) => {
+            if (err) {
+              onError(err)
+            }
+          }
+
           resolve({
             status,
             statusText,
             headersList,
-            body: decoders.length
-              ? pipeline(this.body, ...decoders, noop)
-              : this.body.on('error', noop)
+            body: streams === undefined
+              ? this.body.on('error', onError)
+              : pipeline(streams, callback).on('error', onError)
           })
 
           return true
diff --git a/lib/web/fetch/util.js b/lib/web/fetch/util.js
index f53991c9440..9bead826aa9 100644
--- a/lib/web/fetch/util.js
+++ b/lib/web/fetch/util.js
@@ -1338,6 +1338,14 @@ function buildContentRange (rangeStart, rangeEnd, fullLength) {
 // interpreted as a zlib stream, otherwise it's interpreted as a
 // raw deflate stream.
 class InflateStream extends Transform {
+  #zlibOptions
+
+  /** @param {zlib.ZlibOptions} [zlibOptions] */
+  constructor (zlibOptions) {
+    super()
+    this.#zlibOptions = zlibOptions
+  }
+
   _transform (chunk, encoding, callback) {
     if (!this._inflateStream) {
       if (chunk.length === 0) {
@@ -1345,8 +1353,8 @@ class InflateStream extends Transform {
         return
       }
       this._inflateStream = (chunk[0] & 0x0F) === 0x08
-        ? zlib.createInflate()
-        : zlib.createInflateRaw()
+        ? zlib.createInflate(this.#zlibOptions)
+        : zlib.createInflateRaw(this.#zlibOptions)
 
       this._inflateStream.on('data', this.push.bind(this))
       this._inflateStream.on('end', () => this.push(null))
@@ -1365,8 +1373,12 @@ class InflateStream extends Transform {
   }
 }
 
-function createInflate () {
-  return new InflateStream()
+/**
+ * @param {zlib.ZlibOptions} [zlibOptions]
+ * @returns {InflateStream}
+ */
+function createInflate (zlibOptions) {
+  return new InflateStream(zlibOptions)
 }
 
 /**
diff --git a/test/issue-3616.js b/test/issue-3616.js
new file mode 100644
index 00000000000..1817a61e0a4
--- /dev/null
+++ b/test/issue-3616.js
@@ -0,0 +1,48 @@
+'use strict'
+
+const { createServer } = require('node:http')
+const { tspl } = require('@matteo.collina/tspl')
+const { describe, test, after } = require('node:test')
+const { fetch } = require('..')
+const { once } = require('node:events')
+
+describe('https://github.com/nodejs/undici/issues/3616', () => {
+  const cases = [
+    'x-gzip',
+    'gzip',
+    'deflate',
+    'br'
+  ]
+
+  for (const encoding of cases) {
+    test(encoding, async t => {
+      t = tspl(t, { plan: 2 })
+      const server = createServer((req, res) => {
+        res.writeHead(200, {
+          'Content-Length': '0',
+          Connection: 'close',
+          'Content-Encoding': encoding
+        })
+        res.end()
+      })
+
+      after(() => {
+        server.close()
+      })
+
+      server.listen(0)
+
+      await once(server, 'listening')
+      const result = await fetch(`http://localhost:${server.address().port}/`)
+
+      t.ok(result.body.getReader())
+
+      process.on('uncaughtException', (reason) => {
+        t.fail('Uncaught Exception:', reason, encoding)
+      })
+
+      await new Promise(resolve => setTimeout(resolve, 100))
+      t.ok(true)
+    })
+  }
+})