diff --git a/terminatorlib/config.py b/terminatorlib/config.py
index 8c794f32..fc2603f1 100755
--- a/terminatorlib/config.py
+++ b/terminatorlib/config.py
@@ -215,7 +215,8 @@ DEFAULTS = {
                 'color_scheme'          : 'grey_on_black',
                 'cursor_blink'          : True,
                 'cursor_shape'          : 'block',
-                'cursor_color'          : '#aaaaaa',
+                'cursor_color'          : '',
+                'cursor_color_fg'       : True,
                 'emulation'             : 'xterm',
                 'term'                  : 'xterm-256color',
                 'colorterm'             : 'gnome-terminal',
diff --git a/terminatorlib/preferences.glade b/terminatorlib/preferences.glade
index 021c2920..62650cf3 100644
--- a/terminatorlib/preferences.glade
+++ b/terminatorlib/preferences.glade
@@ -1784,24 +1784,70 @@
                                           <object class="GtkHBox" id="hbox1">
                                             <property name="visible">True</property>
                                             <property name="can_focus">False</property>
+                                            <property name="spacing">6</property>
                                             <child>
-                                              <object class="GtkColorButton" id="cursor_color">
+                                              <object class="GtkRadioButton" id="cursor_color_foreground_radiobutton">
+                                                <property name="label" translatable="yes">Foreground</property>
                                                 <property name="visible">True</property>
                                                 <property name="can_focus">True</property>
-                                                <property name="receives_default">True</property>
+                                                <property name="receives_default">False</property>
                                                 <property name="use_action_appearance">False</property>
-                                                <property name="xalign">0</property>
-                                                <property name="color">#000000000000</property>
-                                                <signal name="color-set" handler="on_cursor_color_color_set" swapped="no"/>
+                                                <property name="active">True</property>
+                                                <property name="draw_indicator">True</property>
+                                                <signal name="toggled" handler="on_cursor_color_type_toggled" swapped="no"/>
                                               </object>
                                               <packing>
                                                 <property name="expand">False</property>
-                                                <property name="fill">False</property>
+                                                <property name="fill">True</property>
                                                 <property name="position">0</property>
                                               </packing>
                                             </child>
                                             <child>
-                                              <placeholder/>
+                                              <object class="GtkHBox" id="hbox4">
+                                                <property name="visible">True</property>
+                                                <property name="can_focus">False</property>
+                                                <child>
+                                                  <object class="GtkRadioButton" id="cursor_color_custom_radiobutton">
+                                                    <property name="visible">True</property>
+                                                    <property name="can_focus">True</property>
+                                                    <property name="receives_default">False</property>
+                                                    <property name="use_action_appearance">False</property>
+                                                    <property name="active">True</property>
+                                                    <property name="draw_indicator">True</property>
+                                                    <property name="group">cursor_color_foreground_radiobutton</property>
+                                                    <signal name="toggled" handler="on_cursor_color_type_toggled" swapped="no"/>
+                                                  </object>
+                                                  <packing>
+                                                    <property name="expand">False</property>
+                                                    <property name="fill">True</property>
+                                                    <property name="position">0</property>
+                                                  </packing>
+                                                </child>
+                                                <child>
+                                                  <object class="GtkColorButton" id="cursor_color">
+                                                    <property name="visible">True</property>
+                                                    <property name="can_focus">True</property>
+                                                    <property name="receives_default">True</property>
+                                                    <property name="use_action_appearance">False</property>
+                                                    <property name="xalign">0</property>
+                                                    <property name="color">#000000000000</property>
+                                                    <signal name="color-set" handler="on_cursor_color_color_set" swapped="no"/>
+                                                  </object>
+                                                  <packing>
+                                                    <property name="expand">False</property>
+                                                    <property name="fill">False</property>
+                                                    <property name="position">1</property>
+                                                  </packing>
+                                                </child>
+                                                <child>
+                                                  <placeholder/>
+                                                </child>
+                                              </object>
+                                              <packing>
+                                                <property name="expand">True</property>
+                                                <property name="fill">True</property>
+                                                <property name="position">1</property>
+                                              </packing>
                                             </child>
                                           </object>
                                           <packing>
diff --git a/terminatorlib/prefseditor.py b/terminatorlib/prefseditor.py
index 3b353092..72c2f216 100755
--- a/terminatorlib/prefseditor.py
+++ b/terminatorlib/prefseditor.py
@@ -448,13 +448,24 @@ class PrefsEditor:
         # Cursor blink
         widget = guiget('cursor_blink')
         widget.set_active(self.config['cursor_blink'])
-        # Cursor colour
+        # Cursor colour - Radio values
+        if self.config['cursor_color_fg']:
+            widget = guiget('cursor_color_foreground_radiobutton')
+        else:
+            widget = guiget('cursor_color_custom_radiobutton')
+        widget.set_active(True)
+        # Cursor colour - swatch
         widget = guiget('cursor_color')
+        widget.set_sensitive(not self.config['cursor_color_fg'])
         try:
-            widget.set_color(gtk.gdk.Color(self.config['cursor_color']))
-        except ValueError:
-            self.config['cursor_color'] = "#FFFFFF"
-            widget.set_color(gtk.gdk.Color(self.config['cursor_color']))
+             widget.set_color(gtk.gdk.Color(self.config['cursor_color']))
+        except (ValueError, TypeError):
+            try:
+                self.config['cursor_color'] = self.config['foreground_color']
+                widget.set_color(gtk.gdk.Color(self.config['cursor_color']))
+            except ValueError:
+                self.config['cursor_color'] = "#FFFFFF"
+                widget.set_color(gtk.gdk.Color(self.config['cursor_color']))
 
         ## Command tab
         # Login shell
@@ -961,6 +972,26 @@ class PrefsEditor:
         self.config['custom_command'] = widget.get_text()
         self.config.save()
 
+    def on_cursor_color_type_toggled(self, widget):
+        guiget = self.builder.get_object
+
+        customwidget = guiget('cursor_color_custom_radiobutton')
+        colorwidget = guiget('cursor_color')
+        
+        colorwidget.set_sensitive(customwidget.get_active())
+        self.config['cursor_color_fg'] = not customwidget.get_active()
+        
+        try:
+            colorwidget.set_color(gtk.gdk.color_parse(self.config['cursor_color']))
+        except (ValueError, TypeError):
+            try:
+                self.config['cursor_color'] = self.config['foreground_color']
+                colorwidget.set_color(gtk.gdk.color_parse(self.config['cursor_color']))
+            except ValueError:
+                self.config['cursor_color'] = "#FFFFFF"
+                colorwidget.set_color(gtk.gdk.color_parse(self.config['cursor_color']))
+        self.config.save()
+
     def on_cursor_color_color_set(self, widget):
         """Cursor colour changed"""
         self.config['cursor_color'] = color2hex(widget)
diff --git a/terminatorlib/terminal.py b/terminatorlib/terminal.py
index 6dfbd6a2..46128706 100755
--- a/terminatorlib/terminal.py
+++ b/terminatorlib/terminal.py
@@ -799,7 +799,7 @@ class Terminal(gtk.VBox):
 
     def set_cursor_color(self):
         """Set the cursor color appropriately"""
-        if self.config['cursor_color'] == self.config['foreground_color']:
+        if self.config['cursor_color_fg']:
             try:
                 self.vte.set_color_cursor(None) 
             except TypeError: