diff --git a/moto/dynamodb2/responses.py b/moto/dynamodb2/responses.py
index 48340405b..dd51ac972 100644
--- a/moto/dynamodb2/responses.py
+++ b/moto/dynamodb2/responses.py
@@ -400,8 +400,12 @@ class DynamoHandler(BaseResponse):
         key = self.body['Key']
         update_expression = self.body.get('UpdateExpression')
         attribute_updates = self.body.get('AttributeUpdates')
+        existing_item = dynamodb_backend2.get_item(name, key)
         item = dynamodb_backend2.update_item(name, key, update_expression, attribute_updates)
 
         item_dict = item.to_json()
         item_dict['ConsumedCapacityUnits'] = 0.5
+        if not existing_item:
+            item_dict['Attributes'] = {}
+
         return dynamo_json_dump(item_dict)
diff --git a/tests/test_dynamodb2/test_dynamodb_table_with_range_key.py b/tests/test_dynamodb2/test_dynamodb_table_with_range_key.py
index 6a5010bb5..df9428913 100644
--- a/tests/test_dynamodb2/test_dynamodb_table_with_range_key.py
+++ b/tests/test_dynamodb2/test_dynamodb_table_with_range_key.py
@@ -859,7 +859,7 @@ def test_update_item_does_not_exist_is_created():
     table = _create_table_with_range_key()
 
     item_key = {'forum_name': 'the-key', 'subject': '123'}
-    table.update_item(
+    result = table.update_item(
         Key=item_key,
         AttributeUpdates={
             'username': {
@@ -875,8 +875,11 @@ def test_update_item_does_not_exist_is_created():
                 'Value': {'key': 'value'},
             }
         },
+        ReturnValues='ALL_OLD',
     )
 
+    assert not result.get('Attributes')
+
     returned_item = dict((k, str(v) if isinstance(v, Decimal) else v)
                          for k, v in table.get_item(Key=item_key)['Item'].items())
     dict(returned_item).should.equal({
diff --git a/tests/test_dynamodb2/test_dynamodb_table_without_range_key.py b/tests/test_dynamodb2/test_dynamodb_table_without_range_key.py
index 6baeb8a12..27acae9f7 100644
--- a/tests/test_dynamodb2/test_dynamodb_table_without_range_key.py
+++ b/tests/test_dynamodb2/test_dynamodb_table_without_range_key.py
@@ -430,7 +430,7 @@ def test_update_item_remove():
     }
     table.put_item(data=data)
     key_map = {
-        "S": "steve"
+        'username': {"S": "steve"}
     }
 
     # Then remove the SentBy field
@@ -455,7 +455,7 @@ def test_update_item_set():
     }
     table.put_item(data=data)
     key_map = {
-        "S": "steve"
+        'username': {"S": "steve"}
     }
 
     conn.update_item("messages", key_map, update_expression="SET foo=:bar, blah=:baz REMOVE :SentBy")