diff --git a/src/InputHandler.ts b/src/InputHandler.ts
index fb37f4ab..356f3b3d 100644
--- a/src/InputHandler.ts
+++ b/src/InputHandler.ts
@@ -1788,6 +1788,9 @@ export class InputHandler extends Disposable implements IInputHandler {
         case 25: // show cursor
           this._coreService.isCursorHidden = false;
           break;
+        case 1039:
+          this._coreService.decPrivateModes.altEnterMode = true;
+          break;
         case 1048: // alt screen cursor
           this.saveCursor();
           break;
@@ -2003,6 +2006,9 @@ export class InputHandler extends Disposable implements IInputHandler {
         case 25: // hide cursor
           this._coreService.isCursorHidden = true;
           break;
+        case 1039:
+          this._coreService.decPrivateModes.altEnterMode = false;
+          break;
         case 1048: // alt screen cursor
           this.restoreCursor();
           break;
diff --git a/src/Terminal.ts b/src/Terminal.ts
index 1bcac1f0..0ca1b186 100644
--- a/src/Terminal.ts
+++ b/src/Terminal.ts
@@ -1222,7 +1222,7 @@ export class Terminal extends Disposable implements ITerminal, IDisposable, IInp
       return false;
     }
 
-    const result = evaluateKeyboardEvent(event, this._coreService.decPrivateModes.applicationCursorKeys, this.browser.isMac, this.options.macOptionIsMeta);
+    const result = evaluateKeyboardEvent(event, this._coreService.decPrivateModes.altEnterMode, this._coreService.decPrivateModes.applicationCursorKeys, this.browser.isMac, this.options.macOptionIsMeta);
 
     this.updateCursorStyle(event);
 
diff --git a/src/common/TestUtils.test.ts b/src/common/TestUtils.test.ts
index 4d9070cd..b4636ebf 100644
--- a/src/common/TestUtils.test.ts
+++ b/src/common/TestUtils.test.ts
@@ -59,6 +59,7 @@ export class MockCoreService implements ICoreService {
   isCursorHidden: boolean = false;
   isFocused: boolean = false;
   decPrivateModes: IDecPrivateModes = {
+    altEnterMode: true,
     applicationCursorKeys: false,
     applicationKeypad: false,
     origin: false,
diff --git a/src/common/Types.d.ts b/src/common/Types.d.ts
index b250b45e..4df53bd4 100644
--- a/src/common/Types.d.ts
+++ b/src/common/Types.d.ts
@@ -152,6 +152,7 @@ export interface IMarker extends IDisposable {
 }
 
 export interface IDecPrivateModes {
+  altEnterMode: boolean;
   applicationCursorKeys: boolean;
   applicationKeypad: boolean;
   origin: boolean;
diff --git a/src/common/input/Keyboard.test.ts b/src/common/input/Keyboard.test.ts
index a304923e..ce492f0c 100644
--- a/src/common/input/Keyboard.test.ts
+++ b/src/common/input/Keyboard.test.ts
@@ -16,6 +16,7 @@ function testEvaluateKeyboardEvent(partialEvent: {
   key?: string;
   type?: string;
 }, partialOptions: {
+  altEnterMode?: boolean;
   applicationCursorMode?: boolean;
   isMac?: boolean;
   macOptionIsMeta?: boolean;
@@ -30,11 +31,12 @@ function testEvaluateKeyboardEvent(partialEvent: {
     type: partialEvent.type || ''
   };
   const options = {
+    altEnterMode: partialOptions.altEnterMode || true,
     applicationCursorMode: partialOptions.applicationCursorMode || false,
     isMac: partialOptions.isMac || false,
     macOptionIsMeta: partialOptions.macOptionIsMeta || false
   };
-  return evaluateKeyboardEvent(event, options.applicationCursorMode, options.isMac, options.macOptionIsMeta);
+  return evaluateKeyboardEvent(event, options.altEnterMode, options.applicationCursorMode, options.isMac, options.macOptionIsMeta);
 }
 
 describe('Keyboard', () => {
@@ -86,6 +88,9 @@ describe('Keyboard', () => {
     it('should return \\x1b[3;3~ for alt+delete', () => {
       assert.equal(testEvaluateKeyboardEvent({ altKey: true, keyCode: 46 }).key, '\x1b[3;3~');
     });
+    it('should return \\x1b\\r for alt+enter', () => {
+      assert.equal(testEvaluateKeyboardEvent({ altKey: true, keyCode: 13 }).key, '\x1b\r');
+    });
     it('should return \\x1b[5D for ctrl+left', () => {
       assert.equal(testEvaluateKeyboardEvent({ ctrlKey: true, keyCode: 37 }).key, '\x1b[1;5D'); // CSI 5 D
     });
diff --git a/src/common/input/Keyboard.ts b/src/common/input/Keyboard.ts
index 1bf378c1..34433dea 100644
--- a/src/common/input/Keyboard.ts
+++ b/src/common/input/Keyboard.ts
@@ -37,6 +37,7 @@ const KEYCODE_KEY_MAPPINGS: { [key: number]: [string, string]} = {
 
 export function evaluateKeyboardEvent(
   ev: IKeyboardEvent,
+  altEnterMode: boolean,
   applicationCursorMode: boolean,
   isMac: boolean,
   macOptionIsMeta: boolean
@@ -103,7 +104,12 @@ export function evaluateKeyboardEvent(
       break;
     case 13:
       // return/enter
-      result.key = C0.CR;
+      if (altEnterMode && modifiers === 2) {
+        result.key = C0.ESC + C0.CR;
+      }
+      else {
+        result.key = C0.CR;
+      }
       result.cancel = true;
       break;
     case 27:
diff --git a/src/common/services/CoreService.ts b/src/common/services/CoreService.ts
index df9161e9..1ae906cc 100644
--- a/src/common/services/CoreService.ts
+++ b/src/common/services/CoreService.ts
@@ -9,6 +9,7 @@ import { IDecPrivateModes, ICharset } from 'common/Types';
 import { clone } from 'common/Clone';
 
 const DEFAULT_DEC_PRIVATE_MODES: IDecPrivateModes = Object.freeze({
+  altEnterMode: true,
   applicationCursorKeys: false,
   applicationKeypad: false,
   origin: false,