An axial fan assembly including a casing wall with a forward facing step formed therein. Formed on the surface of the step is a plurality of circumferentially spaced wedges which are formed and positioned so as to reduce the swirl flow within the clearance gap between the fan rotor and casing. The wedges are formed so the swirling backflow first encounters a circumferentially tapered face and then an abrupt axially oriented face, thereby substantially removing the swirl component. The wedges have a favorable effect on the flow stability of the fan, thereby extending its operating range. Variations include a fan rotor with a rotating shroud with an outwardly extending portion overlapping the step, and a bellmouth piece at the casing inlet.