diff --git a/stepmania/src/GameState.cpp b/stepmania/src/GameState.cpp
index d3359eb42a..4679008fbb 100644
--- a/stepmania/src/GameState.cpp
+++ b/stepmania/src/GameState.cpp
@@ -59,6 +59,7 @@ void GameState::Reset()
 //	m_iCoins = 0;	// don't reset coin count!
 	m_MasterPlayerNumber = PLAYER_INVALID;
 	m_sPreferredGroup	= GROUP_ALL_MUSIC;
+	m_bChangedFailMode = false;
 	for( p=0; p<NUM_PLAYERS; p++ )
 		m_PreferredDifficulty[p] = DIFFICULTY_INVALID;
 	m_SongSortOrder = SORT_PREFERRED;
diff --git a/stepmania/src/GameState.h b/stepmania/src/GameState.h
index b015b6c453..b4caad8fd0 100644
--- a/stepmania/src/GameState.h
+++ b/stepmania/src/GameState.h
@@ -99,6 +99,7 @@ public:
 
 	CString			m_sLoadingMessage;	// used in loading screen
 	CString			m_sPreferredGroup;	// GROUP_ALL_MUSIC denotes no preferred group
+	bool			m_bChangedFailMode;	// true if the fail mode was changed in the song options screen
 	Difficulty		m_PreferredDifficulty[NUM_PLAYERS];
 	SongSortOrder	m_SongSortOrder;			// used by MusicWheel
 	bool			m_bEditing;			// NoteField does special stuff when this is true
diff --git a/stepmania/src/ScreenSelectMusic.cpp b/stepmania/src/ScreenSelectMusic.cpp
index 6616077c20..212b435dfc 100644
--- a/stepmania/src/ScreenSelectMusic.cpp
+++ b/stepmania/src/ScreenSelectMusic.cpp
@@ -521,36 +521,25 @@ void ScreenSelectMusic::AdjustOptions()
 		dc = min(dc, GAMESTATE->m_pCurNotes[p]->GetDifficulty());
 	}
 
-	/* This can still interfere a bit with the song options menu; eg. if a
-	 * player changes to a mode easier than the preference setting, we might
-	 * reset it to the preference later. XXX */
+	LOG->Trace( "AdjustOptions: difficulty %i", dc );
+	if( !GAMESTATE->m_bChangedFailMode )
+	{
+		GAMESTATE->m_SongOptions.m_FailType = SongOptions::FAIL_ARCADE;
 
-	/* Never set the FailType harder than the preference. */
-	SongOptions::FailType ft = SongOptions::FAIL_ARCADE;
+        /* Easy and beginner are never harder than FAIL_END_OF_SONG. */
+		if(dc <= DIFFICULTY_EASY)
+		{
+			LOG->Trace( "AdjustOptions: EOS" );
+			GAMESTATE->m_SongOptions.m_FailType = SongOptions::FAIL_END_OF_SONG;
+		}
 
-	/* Easy and beginner are never harder than FAIL_END_OF_SONG. */
-	if(dc <= DIFFICULTY_EASY)
-		ft = SongOptions::FAIL_END_OF_SONG;
-	/* If beginner's steps were chosen, and this is the first stage,
-	 * turn off failure completely--always give a second try. */
-	if(dc == DIFFICULTY_BEGINNER &&
-		PREFSMAN->m_bEventMode && /* stage index is meaningless in event mode */
-		GAMESTATE->m_iCurrentStageIndex == 0)
-		ft = SongOptions::FAIL_OFF;
-//  Redundant.   -Chris
-//	else if(GAMESTATE->IsExtraStage() || GAMESTATE->IsExtraStage2())
-//	{
-//		/* Extra stage.  We need to make sure we undo any changes above from
-//		 * previous rounds; eg. where one player is on beginner and the other
-//		 * is on hard, we've changed the fail mode in previous rounds and we
-//		 * want to reset it for the extra stage.
-//		 *
-//		 * Besides, extra stage should probably always be FAIL_ARCADE anyway,
-//		 * unless the extra stage course says otherwise. */
-//		ft = SongOptions::FAIL_ARCADE;
-//	}
-
-	GAMESTATE->m_SongOptions.m_FailType = max( ft, GAMESTATE->m_SongOptions.m_FailType );
+		/* If beginner's steps were chosen, and this is the first stage,
+		 * turn off failure completely--always give a second try. */
+		if(dc == DIFFICULTY_BEGINNER &&
+			!PREFSMAN->m_bEventMode && /* stage index is meaningless in event mode */
+			GAMESTATE->m_iCurrentStageIndex == 0)
+			GAMESTATE->m_SongOptions.m_FailType = SongOptions::FAIL_OFF;
+	}
 }
 
 void ScreenSelectMusic::HandleScreenMessage( const ScreenMessage SM )
diff --git a/stepmania/src/ScreenSongOptions.cpp b/stepmania/src/ScreenSongOptions.cpp
index 83f266ccf6..0840b30808 100644
--- a/stepmania/src/ScreenSongOptions.cpp
+++ b/stepmania/src/ScreenSongOptions.cpp
@@ -101,7 +101,12 @@ void ScreenSongOptions::ExportOptions()
 	so.m_LifeType = (SongOptions::LifeType)m_iSelectedOption[0][SO_LIFE];
 	so.m_DrainType = (SongOptions::DrainType)m_iSelectedOption[0][SO_DRAIN];
 	so.m_iBatteryLives = m_iSelectedOption[0][SO_BAT_LIVES]+1;
-	so.m_FailType =	(SongOptions::FailType)m_iSelectedOption[0][SO_FAIL];
+	if( so.m_FailType !=	(SongOptions::FailType)m_iSelectedOption[0][SO_FAIL] )
+	{
+		/* The user is changing the fail mode explicitly; stop messing with it. */
+		GAMESTATE->m_bChangedFailMode = true;
+		so.m_FailType =	(SongOptions::FailType)m_iSelectedOption[0][SO_FAIL];
+	}
 	so.m_bAssistTick = !!m_iSelectedOption[0][SO_ASSIST];
 	so.m_bAutoSync = !!m_iSelectedOption[0][SO_AUTOSYNC];