diff --git a/docs/changelog.rst b/docs/changelog.rst
index c9535a07..92770afb 100644
--- a/docs/changelog.rst
+++ b/docs/changelog.rst
@@ -5,6 +5,7 @@ Changelog
 
 Changes in 0.7.8
 ================
+- Fix sequence fields in embedded documents (MongoEngine/mongoengine#166)
 - Fix query chaining with .order_by() (MongoEngine/mongoengine#176)
 - Added optional encoding and collection config for Django sessions (MongoEngine/mongoengine#180, MongoEngine/mongoengine#181, MongoEngine/mongoengine#183)
 - Fixed EmailField so can add extra validation (MongoEngine/mongoengine#173, MongoEngine/mongoengine#174, MongoEngine/mongoengine#187)
diff --git a/mongoengine/fields.py b/mongoengine/fields.py
index 9c0bedec..3f413b25 100644
--- a/mongoengine/fields.py
+++ b/mongoengine/fields.py
@@ -1338,7 +1338,7 @@ class SequenceField(IntField):
 
     .. versionadded:: 0.5
     """
-    def __init__(self, collection_name=None, db_alias = None, sequence_name = None, *args, **kwargs):
+    def __init__(self, collection_name=None, db_alias=None, sequence_name=None, *args, **kwargs):
         self.collection_name = collection_name or 'mongoengine.counters'
         self.db_alias = db_alias or DEFAULT_CONNECTION_NAME
         self.sequence_name = sequence_name
@@ -1348,7 +1348,7 @@ class SequenceField(IntField):
         """
         Generate and Increment the counter
         """
-        sequence_name = self.sequence_name or self.owner_document._get_collection_name()
+        sequence_name = self.get_sequence_name()
         sequence_id = "%s.%s" % (sequence_name, self.name)
         collection = get_db(alias=self.db_alias)[self.collection_name]
         counter = collection.find_and_modify(query={"_id": sequence_id},
@@ -1357,6 +1357,15 @@ class SequenceField(IntField):
                                              upsert=True)
         return counter['next']
 
+    def get_sequence_name(self):
+        if self.sequence_name:
+            return self.sequence_name
+        owner = self.owner_document
+        if issubclass(owner, Document):
+            return owner._get_collection_name()
+        else:
+            return owner._class_name
+
     def __get__(self, instance, owner):
 
         if instance is None:
diff --git a/tests/test_fields.py b/tests/test_fields.py
index 88e82f17..fdcc3080 100644
--- a/tests/test_fields.py
+++ b/tests/test_fields.py
@@ -2175,6 +2175,28 @@ class FieldTest(unittest.TestCase):
         c = self.db['mongoengine.counters'].find_one({'_id': 'animal.id'})
         self.assertEqual(c['next'], 10)
 
+    def test_embedded_sequence_field(self):
+        class Comment(EmbeddedDocument):
+            id = SequenceField()
+            content = StringField(required=True)
+
+        class Post(Document):
+            title = StringField(required=True)
+            comments = ListField(EmbeddedDocumentField(Comment))
+
+        self.db['mongoengine.counters'].drop()
+        Post.drop_collection()
+
+        Post(title="MongoEngine",
+             comments=[Comment(content="NoSQL Rocks"),
+                       Comment(content="MongoEngine Rocks")]).save()
+
+        c = self.db['mongoengine.counters'].find_one({'_id': 'Comment.id'})
+        self.assertEqual(c['next'], 2)
+        post = Post.objects.first()
+        self.assertEqual(1, post.comments[0].id)
+        self.assertEqual(2, post.comments[1].id)
+
     def test_generic_embedded_document(self):
         class Car(EmbeddedDocument):
             name = StringField()