diff --git a/netutils/pppd/lcp.c b/netutils/pppd/lcp.c
index 069e4327a..4637a7a4a 100644
--- a/netutils/pppd/lcp.c
+++ b/netutils/pppd/lcp.c
@@ -135,7 +135,11 @@ void lcp_rx(struct ppp_context_s *ctx, uint8_t * buffer, uint16_t count)
       /* In case of new peer connection */
 
       ipcp_init(ctx);
-      ctx->lcp_state &= ~LCP_RX_UP;
+      
+      /* Clear LCP state to keep it in negotiation phase. LCP_TX_UP will be re-set
+       * once a CONF_ACK is received. */
+      
+      ctx->lcp_state &= ~LCP_TX_UP;
 
       DEBUG1(("received [LCP Config Request id %u\n", id));
       if (scan_packet