diff --git a/src/DynamicData.Tests/Binding/ObservableCollectionBindCacheFixture.cs b/src/DynamicData.Tests/Binding/ObservableCollectionBindCacheFixture.cs
index 966e963db..dbc633907 100644
--- a/src/DynamicData.Tests/Binding/ObservableCollectionBindCacheFixture.cs
+++ b/src/DynamicData.Tests/Binding/ObservableCollectionBindCacheFixture.cs
@@ -1,5 +1,7 @@
 using System;
+using System.Collections.Specialized;
 using System.Linq;
+using System.Reactive.Linq;
 using DynamicData.Binding;
 using DynamicData.Tests.Domain;
 using FluentAssertions;
@@ -49,6 +51,25 @@ public void UpdateToSourceUpdatesTheDestination()
             _collection.First().Should().Be(personUpdated, "Should be updated person");
         }
 
+        [Fact]
+        public void UpdateToSourceSendsReplaceOnDestination()
+        {
+            var person = new Person("Adult1", 50);
+            var anotherPerson = new Person("Adult1", 51);
+            NotifyCollectionChangedAction action = default;
+            _source.AddOrUpdate(person);
+
+            using (_collection
+                .ObserveCollectionChanges()
+                .Select(x => x.EventArgs.Action)
+                .Subscribe(updateType => action = updateType))
+            {
+                _source.AddOrUpdate(anotherPerson);
+            }
+
+            action.Should().Be(NotifyCollectionChangedAction.Replace, "The notification type should be Replace");
+        }
+
         [Fact]
         public void RemoveSourceRemovesFromTheDestination()
         {
diff --git a/src/DynamicData/Binding/ObservableCollectionAdaptor.cs b/src/DynamicData/Binding/ObservableCollectionAdaptor.cs
index 026afc6bf..ce2d8e0e1 100644
--- a/src/DynamicData/Binding/ObservableCollectionAdaptor.cs
+++ b/src/DynamicData/Binding/ObservableCollectionAdaptor.cs
@@ -127,8 +127,7 @@ private void DoUpdate(IChangeSet<TObject, TKey> updates, IObservableCollection<T
                         list.Remove(update.Current);
                         break;
                     case ChangeReason.Update:
-                        list.Remove(update.Previous.Value);
-                        list.Add(update.Current);
+                        list.Replace(update.Previous.Value, update.Current);
                         break;
                 }
             }