diff --git a/crates/chain/src/indexer/keychain_txout.rs b/crates/chain/src/indexer/keychain_txout.rs
index 4717cffdc..e6cb1aa78 100644
--- a/crates/chain/src/indexer/keychain_txout.rs
+++ b/crates/chain/src/indexer/keychain_txout.rs
@@ -390,6 +390,8 @@ impl<K: Clone + Ord + Debug> KeychainTxOutIndex<K> {
     /// Here, "unused" means that after the script pubkey was stored in the index, the index has
     /// never scanned a transaction output with it.
     ///
+    /// Returns `false` for an unrevealed index.
+    ///
     /// This calls [`SpkTxOutIndex::is_used`] internally.
     pub fn is_used(&self, keychain: K, index: u32) -> bool {
         self.inner.is_used(&(keychain, index))
diff --git a/crates/chain/src/indexer/spk_txout.rs b/crates/chain/src/indexer/spk_txout.rs
index 1bd889cbb..0c1688ed1 100644
--- a/crates/chain/src/indexer/spk_txout.rs
+++ b/crates/chain/src/indexer/spk_txout.rs
@@ -246,8 +246,10 @@ impl<I: Clone + Ord + core::fmt::Debug> SpkTxOutIndex<I> {
     ///
     /// Here, "unused" means that after the script pubkey was stored in the index, the index has
     /// never scanned a transaction output with it.
+    ///
+    /// Returns `false` if the script pubkey at `index` is not present in the index.
     pub fn is_used(&self, index: &I) -> bool {
-        !self.unused.contains(index)
+        self.spks.contains_key(index) && !self.unused.contains(index)
     }
 
     /// Marks the script pubkey at `index` as used even though it hasn't seen an output spending to
diff --git a/crates/chain/tests/test_keychain_txout_index.rs b/crates/chain/tests/test_keychain_txout_index.rs
index 3dea4544b..8c736653b 100644
--- a/crates/chain/tests/test_keychain_txout_index.rs
+++ b/crates/chain/tests/test_keychain_txout_index.rs
@@ -761,3 +761,29 @@ fn overlapping_descriptor_does_not_panic_in_release() {
     let _ = index.insert_descriptor(1, single);
     assert!(index.reveal_next_spk(1).is_none());
 }
+
+#[test]
+fn is_used_returns_false_for_unrevealed_or_untracked_index() {
+    let mut index = KeychainTxOutIndex::<TestKeychain>::default();
+    assert!(!index.is_used(TestKeychain::External, 0));
+    assert!(!index.is_used(TestKeychain::External, 100));
+
+    let descriptor = parse_descriptor(DESCRIPTORS[0]);
+    let _ = index
+        .insert_descriptor(TestKeychain::External, descriptor)
+        .unwrap();
+
+    // Not revealed yet, so not added to the internal spk index
+    assert!(!index.is_used(TestKeychain::External, 0));
+    assert!(!index.is_used(TestKeychain::External, 1));
+
+    // Reveal index 0
+    let _ = index.reveal_next_spk(TestKeychain::External).unwrap();
+    assert!(!index.is_used(TestKeychain::External, 0));
+    assert!(!index.is_used(TestKeychain::External, 1));
+
+    // Mark index 0 as used
+    assert!(index.mark_used(TestKeychain::External, 0));
+    assert!(index.is_used(TestKeychain::External, 0));
+    assert!(!index.is_used(TestKeychain::External, 1));
+}
diff --git a/crates/chain/tests/test_spk_txout_index.rs b/crates/chain/tests/test_spk_txout_index.rs
index 9f527760a..71066f203 100644
--- a/crates/chain/tests/test_spk_txout_index.rs
+++ b/crates/chain/tests/test_spk_txout_index.rs
@@ -196,6 +196,22 @@ fn spk_txout_spent_created_txouts() {
     );
 }
 
+#[test]
+fn is_used_returns_false_for_untracked_index() {
+    let mut index = SpkTxOutIndex::<u32>::default();
+    assert!(!index.is_used(&0));
+    assert!(!index.is_used(&1));
+
+    let spk = ScriptBuf::from_hex("001404f1e52ce2bab3423c6a8c63b7cd730d8f12542c").unwrap();
+    index.insert_spk(0, spk);
+    assert!(!index.is_used(&0));
+    assert!(!index.is_used(&1));
+
+    index.mark_used(&0);
+    assert!(index.is_used(&0));
+    assert!(!index.is_used(&1));
+}
+
 #[test]
 fn mark_used() {
     let spk1 = ScriptBuf::from_hex("001404f1e52ce2bab3423c6a8c63b7cd730d8f12542c").unwrap();