Method and code for controlling powertrain with lockup torque converter

A method of controlling a vehicle powertrain having an automatic transmission coupled to an engine through a lock-up torque converter includes determining when a torque converter unlock is imminent during a deceleration fuel shut-off event, and delaying the resumption of fuel flow to the engine for a calibratable time period to reduce the likelihood of an undesirable increase in engine output torque when the torque converter has not fully transitioned to an unlocked state. The method also includes determining whether one or more breakout conditions exist that require enabling fuel flow to the engine and, perhaps, triggering an active unlocking of the lock-up torque converter.