diff --git a/examples/README.md b/examples/README.md
index 546f0abf..8998c782 100644
--- a/examples/README.md
+++ b/examples/README.md
@@ -67,6 +67,7 @@ Each of these examples demonstrates one aspect or feature of bashly.
 - [completions](completions#readme) - adding bash completion functionality
 - [validations](validations#readme) - adding validation functions for arguments, flags or environment variables
 - [hooks](hooks#readme) - adding before/after hooks
+- [stacktrace](stacktrace#readme) - adding stacktrace on error
 
 ## Real-world-like examples
 
diff --git a/examples/stacktrace/.gitignore b/examples/stacktrace/.gitignore
new file mode 100644
index 00000000..d3a4c581
--- /dev/null
+++ b/examples/stacktrace/.gitignore
@@ -0,0 +1 @@
+download
diff --git a/examples/stacktrace/README.md b/examples/stacktrace/README.md
new file mode 100644
index 00000000..63eb53e8
--- /dev/null
+++ b/examples/stacktrace/README.md
@@ -0,0 +1,128 @@
+# Stack Trace Example
+
+Demonstrates how to show stack trace on error.
+
+This example was generated with:
+
+```bash
+$ bashly init --minimal
+$ bashly add stacktrace
+$ bashly generate
+# ... now create and edit src/initialize.sh to match the example ...
+# ... now edit src/root_command.sh to match the example ...
+$ bashly generate
+```
+
+<!-- include: src/initialize.sh src/root_command.sh -->
+
+-----
+
+## `bashly.yml`
+
+````yaml
+name: download
+help: Sample minimal application without commands
+version: 0.1.0
+
+args:
+- name: source
+  required: true
+  help: URL to download from
+- name: target
+  help: "Target filename (default: same as source)"
+
+flags:
+- long: --force
+  short: -f
+  help: Overwrite existing files
+
+examples:
+- download example.com
+- download example.com ./output -f
+````
+
+## `src/initialize.sh`
+
+````bash
+## initialize hook
+##
+## Any code here will be placed inside the `initialize()` function and called
+## before running anything else.
+##
+## You can safely delete this file if you do not need it.
+trap 'stacktrace' ERR
+set -o errtrace
+
+````
+
+## `src/root_command.sh`
+
+````bash
+## trigger an error by calling a function that does not exist
+no_such_command
+
+````
+
+
+## Output
+
+### `$ ./download`
+
+````shell
+missing required argument: SOURCE
+usage: download SOURCE [TARGET] [OPTIONS]
+
+
+````
+
+### `$ ./download --help`
+
+````shell
+download - Sample minimal application without commands
+
+Usage:
+  download SOURCE [TARGET] [OPTIONS]
+  download --help | -h
+  download --version | -v
+
+Options:
+  --force, -f
+    Overwrite existing files
+
+  --help, -h
+    Show this help
+
+  --version, -v
+    Show version number
+
+Arguments:
+  SOURCE
+    URL to download from
+
+  TARGET
+    Target filename (default: same as source)
+
+Examples:
+  download example.com
+  download example.com ./output -f
+
+
+
+````
+
+### `$ ./download something`
+
+````shell
+./download: line 15: no_such_command: command not found
+./download:15 in `root_command`: no_such_command
+
+Stack trace:
+	from ./download:15 in `root_command`
+	from ./download:254 in `run`
+	from ./download:260 in `main`
+
+
+````
+
+
+
diff --git a/examples/stacktrace/src/bashly.yml b/examples/stacktrace/src/bashly.yml
new file mode 100644
index 00000000..58119ca0
--- /dev/null
+++ b/examples/stacktrace/src/bashly.yml
@@ -0,0 +1,19 @@
+name: download
+help: Sample minimal application without commands
+version: 0.1.0
+
+args:
+- name: source
+  required: true
+  help: URL to download from
+- name: target
+  help: "Target filename (default: same as source)"
+
+flags:
+- long: --force
+  short: -f
+  help: Overwrite existing files
+
+examples:
+- download example.com
+- download example.com ./output -f
diff --git a/examples/stacktrace/src/initialize.sh b/examples/stacktrace/src/initialize.sh
new file mode 100644
index 00000000..0fa0e0d6
--- /dev/null
+++ b/examples/stacktrace/src/initialize.sh
@@ -0,0 +1,8 @@
+## initialize hook
+##
+## Any code here will be placed inside the `initialize()` function and called
+## before running anything else.
+##
+## You can safely delete this file if you do not need it.
+trap 'stacktrace' ERR
+set -o errtrace
diff --git a/examples/stacktrace/src/lib/stacktrace.sh b/examples/stacktrace/src/lib/stacktrace.sh
new file mode 100644
index 00000000..570caac3
--- /dev/null
+++ b/examples/stacktrace/src/lib/stacktrace.sh
@@ -0,0 +1,29 @@
+## Stack trace functions [@bashly-upgrade stacktrace]
+## This file is a part of Bashly standard library
+##
+## Usage:
+## This function is designed to be called on error.
+## 
+## To enable this functionality, add these lines to your `src/initialize.sh`
+## file (Run `bashly add hooks` to add this file):
+##
+##   trap 'stacktrace' ERR
+##   set -o errtrace
+##
+## Note that this functionality also requires `set -e`, which is enabled by
+## default in bashly generated scripts.
+##
+stacktrace() {
+  local exit_status="$?"
+  local i=0
+  local caller_output line func file
+
+  printf "%s:%s in \`%s\`: %s\n" "${BASH_SOURCE[0]}" "${BASH_LINENO[0]}" "${FUNCNAME[1]}" "$BASH_COMMAND"
+  printf "\nStack trace:\n"
+  while caller_output="$(caller $i)"; do
+    read -r line func file <<<"$caller_output"
+    printf "\tfrom %s:%s in \`%s\`\n" "$file" "$line" "$func"
+    i=$((i + 1))
+  done
+  exit "$exit_status"
+} >&2
diff --git a/examples/stacktrace/src/root_command.sh b/examples/stacktrace/src/root_command.sh
new file mode 100644
index 00000000..47c99494
--- /dev/null
+++ b/examples/stacktrace/src/root_command.sh
@@ -0,0 +1,2 @@
+## trigger an error by calling a function that does not exist
+no_such_command
diff --git a/examples/stacktrace/test.sh b/examples/stacktrace/test.sh
new file mode 100644
index 00000000..e5ca8732
--- /dev/null
+++ b/examples/stacktrace/test.sh
@@ -0,0 +1,12 @@
+#!/usr/bin/env bash
+
+set -x
+
+bashly add stacktrace --force
+bashly generate
+
+### Try Me ###
+
+./download
+./download --help
+./download something
diff --git a/lib/bashly/libraries/libraries.yml b/lib/bashly/libraries/libraries.yml
index cda16f55..c25eb1d0 100644
--- a/lib/bashly/libraries/libraries.yml
+++ b/lib/bashly/libraries/libraries.yml
@@ -102,6 +102,19 @@ settings:
     - source: "settings/settings.yml"
       target: "settings.yml"
 
+stacktrace:
+  help: Add a function that shows stacktrace on error.
+  files:
+    - source: "stacktrace/stacktrace.sh"
+      target: "%{user_lib_dir}/stacktrace.%{user_ext}"
+  post_install_message: |
+    The stacktrace function is designed to be called automatically on error.
+
+    To enable this functionality, add these lines to your `initialize.sh`:
+    
+      g`trap 'stacktrace' ERR`
+      g`set -o errtrace`
+
 strings:
   help: Copy an additional configuration file to your project, allowing you to customize all the tips and error strings.
   files:
diff --git a/lib/bashly/libraries/stacktrace/stacktrace.sh b/lib/bashly/libraries/stacktrace/stacktrace.sh
new file mode 100644
index 00000000..570caac3
--- /dev/null
+++ b/lib/bashly/libraries/stacktrace/stacktrace.sh
@@ -0,0 +1,29 @@
+## Stack trace functions [@bashly-upgrade stacktrace]
+## This file is a part of Bashly standard library
+##
+## Usage:
+## This function is designed to be called on error.
+## 
+## To enable this functionality, add these lines to your `src/initialize.sh`
+## file (Run `bashly add hooks` to add this file):
+##
+##   trap 'stacktrace' ERR
+##   set -o errtrace
+##
+## Note that this functionality also requires `set -e`, which is enabled by
+## default in bashly generated scripts.
+##
+stacktrace() {
+  local exit_status="$?"
+  local i=0
+  local caller_output line func file
+
+  printf "%s:%s in \`%s\`: %s\n" "${BASH_SOURCE[0]}" "${BASH_LINENO[0]}" "${FUNCNAME[1]}" "$BASH_COMMAND"
+  printf "\nStack trace:\n"
+  while caller_output="$(caller $i)"; do
+    read -r line func file <<<"$caller_output"
+    printf "\tfrom %s:%s in \`%s\`\n" "$file" "$line" "$func"
+    i=$((i + 1))
+  done
+  exit "$exit_status"
+} >&2
diff --git a/spec/approvals/cli/add/list b/spec/approvals/cli/add/list
index e7a51128..fbdd60c5 100644
--- a/spec/approvals/cli/add/list
+++ b/spec/approvals/cli/add/list
@@ -42,6 +42,9 @@ settings
   Copy a sample settings.yml file to your project, allowing you to customize
   some bashly options.
 
+stacktrace
+  Add a function that shows stacktrace on error.
+
 strings
   Copy an additional configuration file to your project, allowing you to
   customize all the tips and error strings.
diff --git a/spec/approvals/examples/stacktrace b/spec/approvals/examples/stacktrace
new file mode 100644
index 00000000..1f8ecf3d
--- /dev/null
+++ b/spec/approvals/examples/stacktrace
@@ -0,0 +1,55 @@
++ bashly add stacktrace --force
+created src/lib/stacktrace.sh
+
+The stacktrace function is designed to be called automatically on error.
+
+To enable this functionality, add these lines to your `initialize.sh`:
+
+  trap 'stacktrace' ERR
+  set -o errtrace
+
++ bashly generate
+creating user files in src
+skipped src/root_command.sh (exists)
+created ./download
+run ./download --help to test your bash script
++ ./download
+missing required argument: SOURCE
+usage: download SOURCE [TARGET] [OPTIONS]
++ ./download --help
+download - Sample minimal application without commands
+
+Usage:
+  download SOURCE [TARGET] [OPTIONS]
+  download --help | -h
+  download --version | -v
+
+Options:
+  --force, -f
+    Overwrite existing files
+
+  --help, -h
+    Show this help
+
+  --version, -v
+    Show version number
+
+Arguments:
+  SOURCE
+    URL to download from
+
+  TARGET
+    Target filename (default: same as source)
+
+Examples:
+  download example.com
+  download example.com ./output -f
+
++ ./download something
+./download: line 15: no_such_command: command not found
+./download:15 in `root_command`: no_such_command
+
+Stack trace:
+	from ./download:15 in `root_command`
+	from ./download:255 in `run`
+	from ./download:261 in `main`
diff --git a/spec/bashly/library_source_spec.rb b/spec/bashly/library_source_spec.rb
index 5ffe9514..fb5fff0a 100644
--- a/spec/bashly/library_source_spec.rb
+++ b/spec/bashly/library_source_spec.rb
@@ -101,7 +101,7 @@
     it 'returns all libraries as keys' do
       expect(subject.libraries.keys).to match_array %i[
         colors completions completions_script completions_yaml config
-        help hooks ini lib settings strings test validations yaml
+        help hooks ini lib settings stacktrace strings test validations yaml
         render_markdown render_mandoc
       ]
     end