diff --git a/README.md b/README.md
index c7401052..bb880cc7 100644
--- a/README.md
+++ b/README.md
@@ -136,6 +136,16 @@ await ofetch("http://google.com/404", {
 });
 ```
 
+You can also pass a callback as a `retry` option. It takes a fetch context object and the count of retries and returns a boolean.
+
+```ts
+await $fetch("/api", {
+  retry: (ctx, count) => {
+    return count <= 3 && ctx.error?.code === "007";
+  },
+});
+```
+
 ## ✔️ Timeout
 
 You can specify `timeout` in milliseconds to automatically abort a request after a timeout (default is disabled).
diff --git a/src/fetch.ts b/src/fetch.ts
index c0021c08..f18a5e2c 100644
--- a/src/fetch.ts
+++ b/src/fetch.ts
@@ -37,7 +37,9 @@ export function createFetch(globalOptions: CreateFetchOptions = {}): $Fetch {
     AbortController = globalThis.AbortController,
   } = globalOptions;
 
-  async function onError(context: FetchContext): Promise<FetchResponse<any>> {
+  async function getRetryResponse(
+    context: FetchContext
+  ): Promise<FetchResponse<any> | void> {
     // Is Abort
     // If it is an active abort, it will not retry automatically.
     // https://developer.mozilla.org/en-US/docs/Web/API/DOMException#error_names
@@ -56,24 +58,35 @@ export function createFetch(globalOptions: CreateFetchOptions = {}): $Fetch {
       }
 
       const responseCode = (context.response && context.response.status) || 500;
-      if (
-        retries > 0 &&
-        (Array.isArray(context.options.retryStatusCodes)
-          ? context.options.retryStatusCodes.includes(responseCode)
-          : retryStatusCodes.has(responseCode))
-      ) {
-        const retryDelay = context.options.retryDelay || 0;
+      const hasStatusCode = Array.isArray(context.options.retryStatusCodes)
+        ? context.options.retryStatusCodes.includes(responseCode)
+        : retryStatusCodes.has(responseCode);
+      // @ts-expect-error value for internal use
+      const { retry, retryDelay = 0, _retryCount = 1 } = context.options;
+      const shouldRetry =
+        typeof retry === "function" ? await retry(context, _retryCount) : false;
+
+      if ((retries > 0 && hasStatusCode) || shouldRetry) {
         if (retryDelay > 0) {
           await new Promise((resolve) => setTimeout(resolve, retryDelay));
         }
         // Timeout
         return $fetchRaw(context.request, {
           ...context.options,
-          retry: retries - 1,
-          timeout: context.options.timeout,
+          retry: typeof retry === "function" ? retry : retries - 1,
+          // @ts-expect-error value for internal use
+          _retryCount: _retryCount + 1,
         });
       }
     }
+  }
+
+  async function onError(context: FetchContext): Promise<FetchResponse<any>> {
+    const retryResponse = await getRetryResponse(context);
+
+    if (retryResponse) {
+      return retryResponse;
+    }
 
     // Throw normalized error
     const error = createFetchError(context);
@@ -213,7 +226,9 @@ export function createFetch(globalOptions: CreateFetchOptions = {}): $Fetch {
       return await onError(context);
     }
 
-    return context.response;
+    const retryResponse = await getRetryResponse(context);
+
+    return retryResponse || context.response;
   };
 
   const $fetch = async function $fetch(request, options) {
diff --git a/src/types.ts b/src/types.ts
index d4f2e11c..7697a6f7 100644
--- a/src/types.ts
+++ b/src/types.ts
@@ -51,7 +51,10 @@ export interface FetchOptions<R extends ResponseType = ResponseType>
   /** timeout in milliseconds */
   timeout?: number;
 
-  retry?: number | false;
+  retry?:
+    | number
+    | false
+    | ((context: FetchContext, count: number) => Promise<boolean> | boolean);
   /** Delay between retries in milliseconds. */
   retryDelay?: number;
   /** Default is [408, 409, 425, 429, 500, 502, 503, 504] */
diff --git a/test/index.test.ts b/test/index.test.ts
index de25338f..86c13005 100644
--- a/test/index.test.ts
+++ b/test/index.test.ts
@@ -9,7 +9,7 @@ import {
   readRawBody,
   toNodeListener,
 } from "h3";
-import { describe, beforeAll, afterAll, it, expect } from "vitest";
+import { describe, beforeAll, afterAll, it, expect, vi } from "vitest";
 import { Headers, FormData, Blob } from "node-fetch-native";
 import { nodeMajorVersion } from "std-env";
 import { $fetch } from "../src/node";
@@ -287,6 +287,13 @@ describe("ofetch", () => {
     expect(race).to.equal("fast");
   });
 
+  it("retry callback", async () => {
+    const retry = vi.fn().mockImplementation((_, count) => count <= 3);
+    await $fetch<string>(getURL("ok"), { retry });
+
+    expect(retry).toHaveBeenCalledTimes(4);
+  });
+
   it("abort with retry", () => {
     const controller = new AbortController();
     async function abortHandle() {