diff --git a/drivers/net/wireless/airo.c b/drivers/net/wireless/airo.c
index ef6495b07890..b96b6dbe01f9 100644
--- a/drivers/net/wireless/airo.c
+++ b/drivers/net/wireless/airo.c
@@ -6266,7 +6266,7 @@ static int airo_set_encodeext(struct net_device *dev,
 	CapabilityRid cap_rid;		/* Card capability info */
 	int perm = ( encoding->flags & IW_ENCODE_TEMP ? 0 : 1 );
 	u16 currentAuthType = local->config.authType;
-	int idx, key_len, alg = ext->alg;	/* Check encryption mode */
+	int idx, key_len, alg = ext->alg, set_key = 1;
 	wep_key_t key;
 
 	/* Is WEP supported ? */
@@ -6289,10 +6289,15 @@ static int airo_set_encodeext(struct net_device *dev,
 	if (encoding->flags & IW_ENCODE_DISABLED)
 		alg = IW_ENCODE_ALG_NONE;
 
-	/* Just setting the transmit key? */
 	if (ext->ext_flags & IW_ENCODE_EXT_SET_TX_KEY) {
+		/* Only set transmit key index here, actual
+		 * key is set below if needed.
+		 */
 		set_wep_key(local, idx, NULL, 0, perm, 1);
-	} else {
+		set_key = ext->key_len > 0 ? 1 : 0;
+	}
+
+	if (set_key) {
 		/* Set the requested key first */
 		memset(key.key, 0, MAX_KEY_SIZE);
 		switch (alg) {