diff --git a/org.eclipse.jgit.test/tst/org/eclipse/jgit/lib/IndexDiffTest.java b/org.eclipse.jgit.test/tst/org/eclipse/jgit/lib/IndexDiffTest.java
index c73764a99..0ce85b4be 100644
--- a/org.eclipse.jgit.test/tst/org/eclipse/jgit/lib/IndexDiffTest.java
+++ b/org.eclipse.jgit.test/tst/org/eclipse/jgit/lib/IndexDiffTest.java
@@ -51,6 +51,7 @@ import java.io.IOException;
 import org.eclipse.jgit.api.Git;
 import org.eclipse.jgit.dircache.DirCache;
 import org.eclipse.jgit.dircache.DirCacheEditor;
+import org.eclipse.jgit.dircache.DirCacheEntry;
 import org.eclipse.jgit.treewalk.FileTreeIterator;
 
 public class IndexDiffTest extends RepositoryTestCase {
@@ -234,6 +235,39 @@ public class IndexDiffTest extends RepositoryTestCase {
 		assertTrue(diff.getUntracked().contains(path));
 	}
 
+	public void testAssumeUnchanged() throws Exception {
+		Git git = new Git(db);
+		String path = "file";
+		writeTrashFile(path, "content");
+		git.add().addFilepattern(path).call();
+		String path2 = "file2";
+		writeTrashFile(path2, "content");
+		git.add().addFilepattern(path2).call();
+		git.commit().setMessage("commit").call();
+		assumeUnchanged(path2);
+		writeTrashFile(path, "more content");
+		writeTrashFile(path2, "more content");
+
+		FileTreeIterator iterator = new FileTreeIterator(db);
+		IndexDiff diff = new IndexDiff(db, Constants.HEAD, iterator);
+		diff.diff();
+		assertEquals(1, diff.getAssumeUnchanged().size());
+		assertEquals(2, diff.getModified().size());
+		assertEquals(0, diff.getChanged().size());
+
+		git.add().addFilepattern(".").call();
+
+		iterator = new FileTreeIterator(db);
+		diff = new IndexDiff(db, Constants.HEAD, iterator);
+		diff.diff();
+		assertEquals(1, diff.getAssumeUnchanged().size());
+		assertEquals(1, diff.getModified().size());
+		assertEquals(1, diff.getChanged().size());
+		assertTrue(diff.getAssumeUnchanged().contains("file2"));
+		assertTrue(diff.getModified().contains("file2"));
+		assertTrue(diff.getChanged().contains("file"));
+	}
+
 	private void removeFromIndex(String path) throws IOException {
 		final DirCache dirc = db.lockDirCache();
 		final DirCacheEditor edit = dirc.editor();
@@ -241,4 +275,15 @@ public class IndexDiffTest extends RepositoryTestCase {
 		if (!edit.commit())
 			throw new IOException("could not commit");
 	}
+
+	private void assumeUnchanged(String path) throws IOException {
+		final DirCache dirc = db.lockDirCache();
+		final DirCacheEntry ent = dirc.getEntry(path);
+		if (ent != null)
+			ent.setAssumeValid(true);
+		dirc.write();
+		if (!dirc.commit())
+			throw new IOException("could not commit");
+	}
+
 }
diff --git a/org.eclipse.jgit/src/org/eclipse/jgit/lib/IndexDiff.java b/org.eclipse.jgit/src/org/eclipse/jgit/lib/IndexDiff.java
index b19e77825..b9291f11d 100644
--- a/org.eclipse.jgit/src/org/eclipse/jgit/lib/IndexDiff.java
+++ b/org.eclipse.jgit/src/org/eclipse/jgit/lib/IndexDiff.java
@@ -65,15 +65,17 @@ import org.eclipse.jgit.treewalk.filter.SkipWorkTreeFilter;
 import org.eclipse.jgit.treewalk.filter.TreeFilter;
 
 /**
- * Compares the index, a tree, and the working directory
- * Ignored files are not taken into account.
- * The following information is retrieved:
- * <li> added files
- * <li> changed files
- * <li> removed files
- * <li> missing files
- * <li> modified files
- * <li> untracked files
+ * Compares the index, a tree, and the working directory Ignored files are not
+ * taken into account. The following information is retrieved:
+ * <ul>
+ * <li>added files</li>
+ * <li>changed files</li>
+ * <li>removed files</li>
+ * <li>missing files</li>
+ * <li>modified files</li>
+ * <li>untracked files</li>
+ * <li>files with assume-unchanged flag</li>
+ * </ul>
  */
 public class IndexDiff {
 
@@ -103,6 +105,8 @@ public class IndexDiff {
 
 	private Set<String> untracked = new HashSet<String>();
 
+	private Set<String> assumeUnchanged = new HashSet<String>();
+
 	/**
 	 * Construct an IndexDiff
 	 *
@@ -191,6 +195,11 @@ public class IndexDiff {
 					WorkingTreeIterator.class);
 			FileMode fileModeTree = treeWalk.getFileMode(TREE);
 
+			if (dirCacheIterator != null) {
+				if (dirCacheIterator.getDirCacheEntry().isAssumeValid())
+					assumeUnchanged.add(dirCacheIterator.getEntryPathString());
+			}
+
 			if (treeIterator != null) {
 				if (dirCacheIterator != null) {
 					if (!treeIterator.getEntryObjectId().equals(
@@ -283,4 +292,10 @@ public class IndexDiff {
 		return untracked;
 	}
 
+	/**
+	 * @return list of files with the flag assume-unchanged
+	 */
+	public Set<String> getAssumeUnchanged() {
+		return assumeUnchanged;
+	}
 }