diff --git a/src/estimator/mhe/execute.jl b/src/estimator/mhe/execute.jl
index 0da59d0e7..9070bb16c 100644
--- a/src/estimator/mhe/execute.jl
+++ b/src/estimator/mhe/execute.jl
@@ -506,7 +506,9 @@ function add_data_windows!(estim::MovingHorizonEstimator, y0m, d0, u0=estim.last
     Nk = estim.Nk[]
     p = estim.direct ? 0 : 1 # u0 argument is u0(k-1) if estim.direct, else u0(k)
     x̂0_old = estim.x̂0        # x̂0_old is x̂0(k-1|k-1) if estim.direct, else x̂0(k|k-1)
-    estim.Nk .+= 1
+    if !estim.direct || !estim.prepared[] 
+        estim.Nk .+= 1 # direct=true: only increments if updatestate! was called
+    end
     Nk = estim.Nk[]
     ismoving = (Nk > estim.He)
     # see MovingHorzionEstimator extended help for the exact time steps in each data window
diff --git a/test/2_test_state_estim.jl b/test/2_test_state_estim.jl
index 98cd8a88d..cef6130b1 100644
--- a/test/2_test_state_estim.jl
+++ b/test/2_test_state_estim.jl
@@ -1038,10 +1038,15 @@ end
 
     mhe2 = MovingHorizonEstimator(linmodel, He=2)
     preparestate!(mhe2, [50, 30], [5])
+    @test mhe2.Nk[] == 1
+    preparestate!(mhe2, [50, 30], [5])
+    @test mhe2.Nk[] == 1
     x̂ = updatestate!(mhe2, [10, 50], [50, 30], [5])
+    @test mhe2.Nk[] == 1
     @test x̂ ≈ zeros(6) atol=1e-9
     @test mhe2.x̂0 ≈ zeros(6) atol=1e-9
     preparestate!(mhe2, [50, 30], [5])
+    @test mhe2.Nk[] == 2
     info = getinfo(mhe2)
     @test info[:x̂] ≈ x̂ atol=1e-9
     @test info[:Ŷ][end-1:end] ≈ [50, 30] atol=1e-9
@@ -1060,7 +1065,9 @@ end
 
     mhe2 = MovingHorizonEstimator(linmodel, He=2, nint_u=[1, 1], nint_ym=[0, 0], direct=false)
     preparestate!(mhe2, [50, 30], [5])
+    @test mhe2.Nk[] == 0
     x̂ = updatestate!(mhe2, [10, 50], [50, 30], [5])
+    @test mhe2.Nk[] == 1
     @test x̂ ≈ zeros(6) atol=1e-9
     @test mhe2.x̂0 ≈ zeros(6) atol=1e-9
     info = getinfo(mhe2)