diff --git a/src/components/avatar/README.md b/src/components/avatar/README.md
index b7f1acbf958..87923df9d9c 100644
--- a/src/components/avatar/README.md
+++ b/src/components/avatar/README.md
@@ -52,27 +52,11 @@ components.
 
 ## Avatar types
 
-The avatar content can be either a short text string, an image, or an icon. Avatar content defaults
+The avatar content can be either a an image, an icon, or short text string. Avatar content defaults
 to the [`'person-fill'` icon](/docs/icons) when no other content is specified.
 
-### Text content
-
-You can specify a short string as the content of an avatar via the `text` prop. The string should be
-short (1 to 3 characters), and will be transformed via CSS to be all uppercase. The font size will
-be scaled relative to the [`size` prop setting](#sizing).
-
-```html
-<template>
-  <div class="mb-2">
-    <b-avatar text="BV"></b-avatar>
-    <b-avatar text="a"></b-avatar>
-    <b-avatar text="Foo"></b-avatar>
-    <b-avatar text="BV" size="4rem"></b-avatar>
-  </div>
-</template>
-
-<!-- b-avatar-text.vue -->
-```
+You can also supply custom content via the default slot, although you may need to apply additional
+styling on the content.
 
 ### Image content
 
@@ -96,7 +80,11 @@ and will be sized to show the avatar's [variant background](#variants) around th
 
 - When using a module bundler and project relative image URLs, please refer to the
   [Component img src resolving](/docs/reference/images) reference section for additional details.
-- The `src` prop takes precedence over the `text` prop.
+- The `src` prop takes precedence over the `icon` and `text` props.
+- <span class="badge badge-secondary">2.11.0+</span> If the image fails to load, the avatar will
+  fallback to the value of the `icon` or `text` props. If neither the `icon` or `text` props are
+  provided, then the default avatar icon will be shown. Also, when the image fails to load, the
+  `img-error` event will be emitted.
 
 ### Icon content
 
@@ -121,10 +109,29 @@ prop should be set to a valid icon name. Icons will scale respective to the [`si
 - When providing a BootstrapVue icon name, you _must_ ensure that you have registered the
   corresponding icon component (either locally to your component/page, or globally), if not using
   the full [`BootstrapVueIcons` plugin](/docs/icons).
-- The `icon` prop takes precedence over the `text` and `src` props.
+- The `icon` prop takes precedence over the `text` prop.
 - If the `text`, `src`, or `icon` props are not provided _and_ the [default slot](#custom-content)
   has no content, then the `person-fill` icon will be used.
 
+### Text content
+
+You can specify a short string as the content of an avatar via the `text` prop. The string should be
+short (1 to 3 characters), and will be transformed via CSS to be all uppercase. The font size will
+be scaled relative to the [`size` prop setting](#sizing).
+
+```html
+<template>
+  <div class="mb-2">
+    <b-avatar text="BV"></b-avatar>
+    <b-avatar text="a"></b-avatar>
+    <b-avatar text="Foo"></b-avatar>
+    <b-avatar text="BV" size="4rem"></b-avatar>
+  </div>
+</template>
+
+<!-- b-avatar-text.vue -->
+```
+
 ### Custom content
 
 Use the `default` slot to render custom content in the avatar, for finer grained control of its
@@ -323,4 +330,4 @@ Avatars are based upon `<b-badge>` and `<b-button>` components, and as such, rel
 `badge-*` and `btn-*` variant classes, as well as the `rounded-*`
 [utility classes](/docs/reference/utility-classes).
 
-`<b-avatar>` also requires BootstrapVue's custom CSS for proper styling.
+`<b-avatar>` also requires BootstrapVue's custom CSS for proper styling.
\ No newline at end of file
diff --git a/src/components/avatar/avatar.js b/src/components/avatar/avatar.js
index 0724fa1347c..85895609440 100644
--- a/src/components/avatar/avatar.js
+++ b/src/components/avatar/avatar.js
@@ -1,4 +1,3 @@
-import { mergeData } from 'vue-functional-data-merge'
 import Vue from '../../utils/vue'
 import pluckProps from '../../utils/pluck-props'
 import { getComponentConfig } from '../../utils/config'
@@ -8,6 +7,7 @@ import { BButton } from '../button/button'
 import { BLink } from '../link/link'
 import { BIcon } from '../../icons/icon'
 import { BIconPersonFill } from '../../icons/icons'
+import normalizeSlotMixin from '../../mixins/normalize-slot'
 
 // --- Constants ---
 const NAME = 'BAvatar'
@@ -135,30 +135,69 @@ const computeSize = value => {
 // @vue/component
 export const BAvatar = /*#__PURE__*/ Vue.extend({
   name: NAME,
-  functional: true,
+  mixins: [normalizeSlotMixin],
   props,
-  render(h, { props, data, children }) {
-    const { variant, disabled, square, icon, src, text, button: isButton, buttonType: type } = props
-    const isBLink = !isButton && (props.href || props.to)
+  data() {
+    return {
+      localSrc: this.src || null
+    }
+  },
+  computed: {
+    computedSize() {
+      return computeSize(this.size)
+    },
+    fontSize() {
+      const size = this.computedSize
+      return size ? `calc(${size} * ${FONT_SIZE_SCALE})` : null
+    }
+  },
+  watch: {
+    src(newSrc, oldSrc) {
+      if (newSrc !== oldSrc) {
+        this.localSrc = newSrc || null
+      }
+    }
+  },
+  methods: {
+    onImgError(evt) {
+      this.localSrc = null
+      this.$emit('img-error', evt)
+    },
+    onClick(evt) {
+      this.$emit('click', evt)
+    }
+  },
+  render(h) {
+    const {
+      variant,
+      disabled,
+      square,
+      icon,
+      localSrc: src,
+      text,
+      fontSize,
+      computedSize: size,
+      button: isButton,
+      buttonType: type
+    } = this
+    const isBLink = !isButton && (this.href || this.to)
     const tag = isButton ? BButton : isBLink ? BLink : 'span'
-    const rounded = square ? false : props.rounded === '' ? true : props.rounded || 'circle'
-    const size = computeSize(props.size)
-    const alt = props.alt || null
-    const ariaLabel = props.ariaLabel || null
+    const rounded = square ? false : this.rounded === '' ? true : this.rounded || 'circle'
+    const alt = this.alt || null
+    const ariaLabel = this.ariaLabel || null
 
     let $content = null
-    if (children) {
+    if (this.hasNormalizedSlot('default')) {
       // Default slot overrides props
-      $content = children
+      $content = this.normalizeSlot('default')
+    } else if (src) {
+      $content = h('img', { attrs: { src, alt }, on: { error: this.onImgError } })
     } else if (icon) {
       $content = h(BIcon, {
         props: { icon },
         attrs: { 'aria-hidden': 'true', alt }
       })
-    } else if (src) {
-      $content = h('img', { attrs: { src, alt } })
     } else if (text) {
-      const fontSize = size ? `calc(${size} * ${FONT_SIZE_SCALE})` : null
       $content = h('span', { style: { fontSize } }, text)
     } else {
       // Fallback default avatar content
@@ -179,9 +218,10 @@ export const BAvatar = /*#__PURE__*/ Vue.extend({
       },
       style: { width: size, height: size },
       attrs: { 'aria-label': ariaLabel },
-      props: isButton ? { variant, disabled, type } : isBLink ? pluckProps(linkProps, props) : {}
+      props: isButton ? { variant, disabled, type } : isBLink ? pluckProps(linkProps, this) : {},
+      on: isBLink || isButton ? { click: this.onClick } : {}
     }
 
-    return h(tag, mergeData(data, componentData), [$content])
+    return h(tag, componentData, [$content])
   }
 })
diff --git a/src/components/avatar/avatar.spec.js b/src/components/avatar/avatar.spec.js
index ccd187e7d0a..d93a3e47dc5 100644
--- a/src/components/avatar/avatar.spec.js
+++ b/src/components/avatar/avatar.spec.js
@@ -1,16 +1,19 @@
 import { mount, createLocalVue as CreateLocalVue } from '@vue/test-utils'
 import { BIconPerson } from '../../icons/icons'
 import { BAvatar } from './avatar'
+import { waitNT } from '../../../tests/utils'
 
 describe('avatar', () => {
   it('should have expected default structure', async () => {
     const wrapper = mount(BAvatar)
+    expect(wrapper.isVueInstance()).toBe(true)
     expect(wrapper.is('span')).toBe(true)
     expect(wrapper.classes()).toContain('b-avatar')
     expect(wrapper.classes()).toContain('badge-secondary')
     expect(wrapper.classes()).not.toContain('disabled')
     expect(wrapper.attributes('href')).not.toBeDefined()
     expect(wrapper.attributes('type')).not.toBeDefined()
+    wrapper.destroy()
   })
 
   it('should have expected structure when prop `button` set', async () => {
@@ -19,6 +22,7 @@ describe('avatar', () => {
         button: true
       }
     })
+    expect(wrapper.isVueInstance()).toBe(true)
     expect(wrapper.is('button')).toBe(true)
     expect(wrapper.classes()).toContain('b-avatar')
     expect(wrapper.classes()).toContain('btn-secondary')
@@ -29,6 +33,17 @@ describe('avatar', () => {
     expect(wrapper.text()).toEqual('')
     expect(wrapper.find('.b-icon').exists()).toBe(true)
     expect(wrapper.find('img').exists()).toBe(false)
+
+    expect(wrapper.emitted('click')).toBeUndefined()
+
+    wrapper.trigger('click')
+    await waitNT(wrapper.vm)
+
+    expect(wrapper.emitted('click')).not.toBeUndefined()
+    expect(wrapper.emitted('click').length).toBe(1)
+    expect(wrapper.emitted('click')[0][0]).toBeInstanceOf(Event)
+
+    wrapper.destroy()
   })
 
   it('should have expected structure when prop `href` set', async () => {
@@ -37,6 +52,7 @@ describe('avatar', () => {
         href: '#foo'
       }
     })
+    expect(wrapper.isVueInstance()).toBe(true)
     expect(wrapper.is('a')).toBe(true)
     expect(wrapper.classes()).toContain('b-avatar')
     expect(wrapper.classes()).toContain('badge-secondary')
@@ -48,6 +64,17 @@ describe('avatar', () => {
     expect(wrapper.text()).toEqual('')
     expect(wrapper.find('.b-icon').exists()).toBe(true)
     expect(wrapper.find('img').exists()).toBe(false)
+
+    expect(wrapper.emitted('click')).toBeUndefined()
+
+    wrapper.trigger('click')
+    await waitNT(wrapper.vm)
+
+    expect(wrapper.emitted('click')).not.toBeUndefined()
+    expect(wrapper.emitted('click').length).toBe(1)
+    expect(wrapper.emitted('click')[0][0]).toBeInstanceOf(Event)
+
+    wrapper.destroy()
   })
 
   it('should have expected structure when prop `text` set', async () => {
@@ -56,6 +83,7 @@ describe('avatar', () => {
         text: 'BV'
       }
     })
+    expect(wrapper.isVueInstance()).toBe(true)
     expect(wrapper.is('span')).toBe(true)
     expect(wrapper.classes()).toContain('b-avatar')
     expect(wrapper.classes()).toContain('badge-secondary')
@@ -65,6 +93,7 @@ describe('avatar', () => {
     expect(wrapper.text()).toContain('BV')
     expect(wrapper.find('.b-icon').exists()).toBe(false)
     expect(wrapper.find('img').exists()).toBe(false)
+    wrapper.destroy()
   })
 
   it('should have expected structure when default slot used', async () => {
@@ -76,6 +105,7 @@ describe('avatar', () => {
         default: 'BAR'
       }
     })
+    expect(wrapper.isVueInstance()).toBe(true)
     expect(wrapper.is('span')).toBe(true)
     expect(wrapper.classes()).toContain('b-avatar')
     expect(wrapper.classes()).toContain('badge-secondary')
@@ -86,14 +116,17 @@ describe('avatar', () => {
     expect(wrapper.text()).not.toContain('FOO')
     expect(wrapper.find('.b-icon').exists()).toBe(false)
     expect(wrapper.find('img').exists()).toBe(false)
+    wrapper.destroy()
   })
 
   it('should have expected structure when prop `src` set', async () => {
     const wrapper = mount(BAvatar, {
       propsData: {
-        src: '/foo/bar'
+        src: '/foo/bar',
+        text: 'BV'
       }
     })
+    expect(wrapper.isVueInstance()).toBe(true)
     expect(wrapper.is('span')).toBe(true)
     expect(wrapper.classes()).toContain('b-avatar')
     expect(wrapper.classes()).toContain('badge-secondary')
@@ -104,9 +137,31 @@ describe('avatar', () => {
     expect(wrapper.find('.b-icon').exists()).toBe(false)
     expect(wrapper.find('img').exists()).toBe(true)
     expect(wrapper.find('img').attributes('src')).toEqual('/foo/bar')
+    expect(wrapper.text()).not.toContain('BV')
+
+    wrapper.setProps({
+      src: '/foo/baz'
+    })
+    await waitNT(wrapper.vm)
+
+    expect(wrapper.find('img').exists()).toBe(true)
+    expect(wrapper.find('img').attributes('src')).toEqual('/foo/baz')
+    expect(wrapper.text()).not.toContain('BV')
+    expect(wrapper.emitted('img-error')).not.toBeDefined()
+    expect(wrapper.text()).not.toContain('BV')
+
+    // Fake an image error
+    wrapper.find('img').trigger('error')
+    await waitNT(wrapper.vm)
+    expect(wrapper.emitted('img-error')).toBeDefined()
+    expect(wrapper.emitted('img-error').length).toBe(1)
+    expect(wrapper.find('img').exists()).toBe(false)
+    expect(wrapper.text()).toContain('BV')
+
+    wrapper.destroy()
   })
 
-  it('should have expected structure when prop `src` set', async () => {
+  it('should have expected structure when prop `icon` set', async () => {
     const localVue = new CreateLocalVue()
     localVue.component('BIconPerson', BIconPerson)
     const wrapper = mount(BAvatar, {
@@ -115,6 +170,7 @@ describe('avatar', () => {
         icon: 'person'
       }
     })
+    expect(wrapper.isVueInstance()).toBe(true)
     expect(wrapper.is('span')).toBe(true)
     expect(wrapper.classes()).toContain('b-avatar')
     expect(wrapper.classes()).toContain('badge-secondary')
@@ -125,31 +181,40 @@ describe('avatar', () => {
     const $icon = wrapper.find('.b-icon')
     expect($icon.exists()).toBe(true)
     expect($icon.classes()).toContain('bi-person')
+    wrapper.destroy()
   })
 
   it('`size` prop should work as expected', async () => {
     const wrapper1 = mount(BAvatar)
     expect(wrapper1.attributes('style')).toEqual('width: 2.5em; height: 2.5em;')
+    wrapper1.destroy()
 
     const wrapper2 = mount(BAvatar, { propsData: { size: 'sm' } })
     expect(wrapper2.attributes('style')).toEqual('width: 1.5em; height: 1.5em;')
+    wrapper2.destroy()
 
     const wrapper3 = mount(BAvatar, { propsData: { size: 'md' } })
     expect(wrapper3.attributes('style')).toEqual('width: 2.5em; height: 2.5em;')
+    wrapper3.destroy()
 
     const wrapper4 = mount(BAvatar, { propsData: { size: 'lg' } })
     expect(wrapper4.attributes('style')).toEqual('width: 3.5em; height: 3.5em;')
+    wrapper4.destroy()
 
     const wrapper5 = mount(BAvatar, { propsData: { size: 20 } })
     expect(wrapper5.attributes('style')).toEqual('width: 20px; height: 20px;')
+    wrapper5.destroy()
 
     const wrapper6 = mount(BAvatar, { propsData: { size: '24.5' } })
     expect(wrapper6.attributes('style')).toEqual('width: 24.5px; height: 24.5px;')
+    wrapper6.destroy()
 
     const wrapper7 = mount(BAvatar, { propsData: { size: '5em' } })
     expect(wrapper7.attributes('style')).toEqual('width: 5em; height: 5em;')
+    wrapper7.destroy()
 
     const wrapper8 = mount(BAvatar, { propsData: { size: '36px' } })
     expect(wrapper8.attributes('style')).toEqual('width: 36px; height: 36px;')
+    wrapper8.destroy()
   })
 })
diff --git a/src/components/avatar/package.json b/src/components/avatar/package.json
index e1ec1db2022..f236072e1a8 100644
--- a/src/components/avatar/package.json
+++ b/src/components/avatar/package.json
@@ -62,11 +62,22 @@
         "events": [
           {
             "event": "click",
-            "description": "Emitted when the avatar is clicked (when rendered as a button or link)",
+            "description": "Emitted when the avatar is clicked when rendered as a button or link. Not emitted otherwise",
             "args": [
               {
                 "arg": "evt",
-                "description": "Native event object"
+                "description": "Native Event object"
+              }
+            ]
+          },
+          {
+            "event": "img-error",
+            "version": "2.11.0",
+            "description": "Emitted if an image `src` is provided and the image fails to load",
+            "args": [
+              {
+                "arg": "evt",
+                "description": "Native Event object"
               }
             ]
           }