Index: Terminal-0.2.5.8rc2/terminal/terminal-screen.c
===================================================================
--- Terminal-0.2.5.8rc2.orig/terminal/terminal-screen.c
+++ Terminal-0.2.5.8rc2/terminal/terminal-screen.c
@@ -868,11 +868,13 @@ terminal_screen_timer_background (gpoint
       vte_terminal_set_background_image (VTE_TERMINAL (screen->terminal), NULL);
       vte_terminal_set_background_saturation (VTE_TERMINAL (screen->terminal), 1.0);
       vte_terminal_set_background_transparent (VTE_TERMINAL (screen->terminal), FALSE);
+      vte_terminal_set_opacity(VTE_TERMINAL(screen->terminal), 0xffff);
     }
   else if (background_mode == TERMINAL_BACKGROUND_IMAGE)
     {
       vte_terminal_set_background_saturation (VTE_TERMINAL (screen->terminal), 1.0);
       vte_terminal_set_background_transparent (VTE_TERMINAL (screen->terminal), FALSE);
+      vte_terminal_set_opacity(VTE_TERMINAL(screen->terminal), 0xffff);
 
       loader = terminal_image_loader_get ();
       image = terminal_image_loader_load (loader,
@@ -883,12 +885,21 @@ terminal_screen_timer_background (gpoint
         g_object_unref (G_OBJECT (image));
       g_object_unref (G_OBJECT (loader));
     }
-  else
+  else if (background_mode == TERMINAL_BACKGROUND_TRANSPARENT)
     {
       g_object_get (G_OBJECT (screen->preferences), "background-darkness", &background_darkness, NULL);
       vte_terminal_set_background_image (VTE_TERMINAL (screen->terminal), NULL);
       vte_terminal_set_background_saturation (VTE_TERMINAL (screen->terminal), 1.0 - background_darkness);
       vte_terminal_set_background_transparent (VTE_TERMINAL (screen->terminal), TRUE);
+      vte_terminal_set_opacity(VTE_TERMINAL(screen->terminal), 0xffff);
+    }
+  else
+    {
+      g_object_get (G_OBJECT (screen->preferences), "background-darkness", &background_darkness, NULL);
+      vte_terminal_set_background_image (VTE_TERMINAL (screen->terminal), NULL);
+      vte_terminal_set_background_saturation (VTE_TERMINAL (screen->terminal), 1.0);
+      vte_terminal_set_background_transparent (VTE_TERMINAL (screen->terminal), FALSE);
+      vte_terminal_set_opacity(VTE_TERMINAL(screen->terminal), background_darkness * 0xffff);
     }
 
   return FALSE;
Index: Terminal-0.2.5.8rc2/terminal/terminal-enum-types.c
===================================================================
--- Terminal-0.2.5.8rc2.orig/terminal/terminal-enum-types.c
+++ Terminal-0.2.5.8rc2/terminal/terminal-enum-types.c
@@ -102,6 +102,7 @@ terminal_background_get_type (void)
 	{ TERMINAL_BACKGROUND_SOLID, "TERMINAL_BACKGROUND_SOLID", "solid" },
 	{ TERMINAL_BACKGROUND_IMAGE, "TERMINAL_BACKGROUND_IMAGE", "image" },
 	{ TERMINAL_BACKGROUND_TRANSPARENT, "TERMINAL_BACKGROUND_TRANSPARENT", "transparent" },
+	{ TERMINAL_BACKGROUND_REALLY_TANSPARENT, "TERMINAL_BACKGROUND_REALLY_TRANSPARENT", "really_transparent" },
 	{ 0, NULL, NULL }
 	};
 	type = g_enum_register_static ("TerminalBackground", values);
Index: Terminal-0.2.5.8rc2/terminal/terminal-preferences-dialog.c
===================================================================
--- Terminal-0.2.5.8rc2.orig/terminal/terminal-preferences-dialog.c
+++ Terminal-0.2.5.8rc2/terminal/terminal-preferences-dialog.c
@@ -95,6 +95,19 @@ transform_is1_or_is2 (const GValue *src_
   return TRUE;
 }
 
+/* Convert int -> boolean (i == 1 || i == 2 || i == 3) */
+static gboolean
+transform_is1_is_2_or_is2 (const GValue *src_value,
+                           GValue       *dst_value,
+                           gpointer      user_data)
+{
+  gint i;
+
+  i = g_value_get_enum (src_value);
+  g_value_set_boolean (dst_value, (i == 1 || i == 2 || i == 3));
+
+  return TRUE;
+}
 
 
 static void
@@ -440,7 +453,8 @@ terminal_preferences_dialog_init (Termin
   combo = gtk_combo_box_new_text ();
   gtk_combo_box_append_text (GTK_COMBO_BOX (combo), _("None (use solid color)"));
   gtk_combo_box_append_text (GTK_COMBO_BOX (combo), _("Background image"));
-  gtk_combo_box_append_text (GTK_COMBO_BOX (combo), _("Transparent background"));
+  gtk_combo_box_append_text (GTK_COMBO_BOX (combo), _("Pseudo transparent background"));
+  gtk_combo_box_append_text (GTK_COMBO_BOX (combo), _("Real transparent background"));
   exo_mutual_binding_new (G_OBJECT (dialog->preferences), "background-mode", G_OBJECT (combo), "active");
 #if !GTK_CHECK_VERSION(2,9,0)
   g_signal_connect (G_OBJECT (combo), "changed", G_CALLBACK (g_object_notify), "active");
@@ -505,7 +519,7 @@ terminal_preferences_dialog_init (Termin
   gtk_widget_show (ibox);
 
   exo_binding_new_full (G_OBJECT (dialog->preferences), "background-mode", G_OBJECT (ibox), "visible",
-                        transform_is1_or_is2, NULL, NULL);
+                        transform_is1_is_2_or_is2, NULL, NULL);
 
   label = gtk_label_new (_("Shade transparent or image background:"));
   gtk_misc_set_alignment (GTK_MISC (label), 0.0, 0.5);
Index: Terminal-0.2.5.8rc2/terminal/terminal-preferences.h
===================================================================
--- Terminal-0.2.5.8rc2.orig/terminal/terminal-preferences.h
+++ Terminal-0.2.5.8rc2/terminal/terminal-preferences.h
@@ -56,6 +56,7 @@ typedef enum /*< enum,prefix=TERMINAL_BA
   TERMINAL_BACKGROUND_SOLID,
   TERMINAL_BACKGROUND_IMAGE,
   TERMINAL_BACKGROUND_TRANSPARENT,
+  TERMINAL_BACKGROUND_REALLY_TANSPARENT
 } TerminalBackground;
 
 typedef enum /*< enum,prefix=TERMINAL_BACKGROUND_STYLE >*/