diff --git a/builtin/common/serialize.lua b/builtin/common/serialize.lua
index cf00107c2..163aa67ad 100644
--- a/builtin/common/serialize.lua
+++ b/builtin/common/serialize.lua
@@ -177,13 +177,16 @@ end
 
 -- Deserialization
 
-local env = {
-	loadstring = loadstring,
-}
+local function safe_loadstring(...)
+	local func, err = loadstring(...)
+	if func then
+		setfenv(func, {})
+		return func
+	end
+	return nil, err
+end
 
-local safe_env = {
-	loadstring = function() end,
-}
+local function dummy_func() end
 
 function core.deserialize(str, safe)
 	if type(str) ~= "string" then
@@ -195,7 +198,10 @@ function core.deserialize(str, safe)
 	end
 	local f, err = loadstring(str)
 	if not f then return nil, err end
-	setfenv(f, safe and safe_env or env)
+
+	-- The environment is recreated every time so deseralized code cannot
+	-- pollute it with permanent references.
+	setfenv(f, {loadstring = safe and dummy_func or safe_loadstring})
 
 	local good, data = pcall(f)
 	if good then
diff --git a/builtin/common/tests/serialize_spec.lua b/builtin/common/tests/serialize_spec.lua
index 321d2766a..c41b0a372 100644
--- a/builtin/common/tests/serialize_spec.lua
+++ b/builtin/common/tests/serialize_spec.lua
@@ -1,6 +1,6 @@
 _G.core = {}
 
-_G.setfenv = function() end
+_G.setfenv = require 'busted.compatibility'.setfenv
 
 dofile("builtin/common/serialize.lua")
 
@@ -25,4 +25,20 @@ describe("serialize", function()
 		local test_out = core.deserialize(core.serialize(test_in))
 		assert.same(test_in, test_out)
 	end)
+
+	it("strips functions in safe mode", function()
+		local test_in = {
+			func = function(a, b)
+				error("test")
+			end,
+			foo = "bar"
+		}
+
+		local str = core.serialize(test_in)
+		assert.not_nil(str:find("loadstring"))
+
+		local test_out = core.deserialize(str, true)
+		assert.is_nil(test_out.func)
+		assert.equals(test_out.foo, "bar")
+	end)
 end)
diff --git a/doc/lua_api.txt b/doc/lua_api.txt
index 10ede5168..acf2f77c1 100644
--- a/doc/lua_api.txt
+++ b/doc/lua_api.txt
@@ -5275,10 +5275,16 @@ Misc.
     * Convert a table containing tables, strings, numbers, booleans and `nil`s
       into string form readable by `minetest.deserialize`
     * Example: `serialize({foo='bar'})`, returns `'return { ["foo"] = "bar" }'`
-* `minetest.deserialize(string)`: returns a table
-    * Convert a string returned by `minetest.deserialize` into a table
+* `minetest.deserialize(string[, safe])`: returns a table
+    * Convert a string returned by `minetest.serialize` into a table
     * `string` is loaded in an empty sandbox environment.
-    * Will load functions, but they cannot access the global environment.
+    * Will load functions if safe is false or omitted. Although these functions
+      cannot directly access the global environment, they could bypass this
+      restriction with maliciously crafted Lua bytecode if mod security is
+      disabled.
+    * This function should not be used on untrusted data, regardless of the
+     value of `safe`. It is fine to serialize then deserialize user-provided
+     data, but directly providing user input to deserialize is always unsafe.
     * Example: `deserialize('return { ["foo"] = "bar" }')`,
       returns `{foo='bar'}`
     * Example: `deserialize('print("foo")')`, returns `nil`