diff --git a/noir-projects/aztec-nr/aztec/src/oracle/encryption.nr b/noir-projects/aztec-nr/aztec/src/oracle/encryption.nr
index cb655c756ce..c8084432437 100644
--- a/noir-projects/aztec-nr/aztec/src/oracle/encryption.nr
+++ b/noir-projects/aztec-nr/aztec/src/oracle/encryption.nr
@@ -1,7 +1,9 @@
 
 #[oracle(aes128Encrypt)]
-pub fn aes128_encrypt_oracle<N>(input: [u8; N], iv: [u8; 16], key: [u8; 16]) -> [u8; N] {}
+pub fn aes128_encrypt_oracle<N, M>(input: [u8; N], iv: [u8; 16], key: [u8; 16]) -> [u8; M] {}
 
-unconstrained pub fn aes128_encrypt<N>(input: [u8; N], iv: [u8; 16], key: [u8; 16]) -> [u8; N] {
+// AES 128 CBC with PKCS7 is padding to multiples of 16 bytes so M has to be a multiple of 16!
+// (e.g. from 65 bytes long input you get 80 bytes long output and M has to be set to `80`)
+unconstrained pub fn aes128_encrypt<N, M>(input: [u8; N], iv: [u8; 16], key: [u8; 16]) -> [u8; M] {
     aes128_encrypt_oracle(input, iv, key)
 }
diff --git a/noir-projects/noir-contracts/contracts/test_contract/src/main.nr b/noir-projects/noir-contracts/contracts/test_contract/src/main.nr
index 107df25dc72..1c14b54c96a 100644
--- a/noir-projects/noir-contracts/contracts/test_contract/src/main.nr
+++ b/noir-projects/noir-contracts/contracts/test_contract/src/main.nr
@@ -310,9 +310,13 @@ contract Test {
     }
 
     #[aztec(private)]
-    fn encrypt(input: [u8; 64], iv: [u8; 16], key: [u8; 16]) {
-        let result = aes128_encrypt(input, iv, key);
-        context.emit_unencrypted_log(result);
+    fn encrypt(input: [u8; 64], iv: [u8; 16], key: [u8; 16]) -> [u8; 64] {
+        aes128_encrypt(input, iv, key)
+    }
+
+    #[aztec(private)]
+    fn encrypt_with_padding(input: [u8; 65], iv: [u8; 16], key: [u8; 16]) -> [u8; 80] {
+        aes128_encrypt(input, iv, key)
     }
 
     #[aztec(public)]
diff --git a/yarn-project/end-to-end/src/e2e_encryption.test.ts b/yarn-project/end-to-end/src/e2e_encryption.test.ts
index 861a7c573c3..9206c566aea 100644
--- a/yarn-project/end-to-end/src/e2e_encryption.test.ts
+++ b/yarn-project/end-to-end/src/e2e_encryption.test.ts
@@ -21,21 +21,35 @@ describe('e2e_encryption', () => {
 
   afterAll(() => teardown());
 
-  it('encrypts', async () => {
+  it('encrypts 🔒📄🔑💻', async () => {
     const input = randomBytes(64);
     const iv = randomBytes(16);
     const key = randomBytes(16);
 
     const expectedCiphertext = aes128.encryptBufferCBC(input, iv, key);
 
-    const logs = await contract.methods
+    const ciphertextAsBigInts = await contract.methods
       .encrypt(Array.from(input), Array.from(iv), Array.from(key))
-      .send()
-      .getUnencryptedLogs();
-    // Each byte of encrypted data is in its own field and it's all serialized into a long buffer so we simply extract
-    // each 32nd byte from the buffer to get the encrypted data
-    const recoveredCiphertext = logs.logs[0].log.data.filter((_, i) => (i + 1) % 32 === 0);
+      .simulate();
+    const ciphertext = Buffer.from(ciphertextAsBigInts.map((x: bigint) => Number(x)));
 
-    expect(recoveredCiphertext).toEqual(expectedCiphertext);
+    expect(ciphertext).toEqual(expectedCiphertext);
+  });
+
+  it('encrypts with padding 🔒📄🔑💻 ➕ 📦', async () => {
+    const input = randomBytes(65);
+    const iv = randomBytes(16);
+    const key = randomBytes(16);
+
+    const expectedCiphertext = aes128.encryptBufferCBC(input, iv, key);
+    // AES 128 CBC with PKCS7 is padding to multiples of 16 bytes so from 65 bytes long input we get 80 bytes long output
+    expect(expectedCiphertext.length).toBe(80);
+
+    const ciphertextAsBigInts = await contract.methods
+      .encrypt_with_padding(Array.from(input), Array.from(iv), Array.from(key))
+      .simulate();
+    const ciphertext = Buffer.from(ciphertextAsBigInts.map((x: bigint) => Number(x)));
+
+    expect(ciphertext).toEqual(expectedCiphertext);
   });
 });