diff --git a/arch/powerpc/include/asm/kvm_ppc.h b/arch/powerpc/include/asm/kvm_ppc.h
index 59b7c87..5459364 100644
--- a/arch/powerpc/include/asm/kvm_ppc.h
+++ b/arch/powerpc/include/asm/kvm_ppc.h
@@ -234,5 +234,15 @@ static inline void kvmppc_mmu_flush_icache(pfn_t pfn)
 	}
 }
 
+/* Please call after prepare_to_enter. This function puts the lazy ee state
+   back to normal mode, without actually enabling interrupts. */
+static inline void kvmppc_lazy_ee_enable(void)
+{
+#ifdef CONFIG_PPC64
+	/* Only need to enable IRQs by hard enabling them after this */
+	local_paca->irq_happened = 0;
+	local_paca->soft_enabled = 1;
+#endif
+}
 
 #endif /* __POWERPC_KVM_PPC_H__ */
diff --git a/arch/powerpc/kvm/book3s_pr.c b/arch/powerpc/kvm/book3s_pr.c
index 3dec346..e737db8 100644
--- a/arch/powerpc/kvm/book3s_pr.c
+++ b/arch/powerpc/kvm/book3s_pr.c
@@ -52,8 +52,6 @@ static int kvmppc_handle_ext(struct kvm_vcpu *vcpu, unsigned int exit_nr,
 #define MSR_USER32 MSR_USER
 #define MSR_USER64 MSR_USER
 #define HW_PAGE_SIZE PAGE_SIZE
-#define __hard_irq_disable local_irq_disable
-#define __hard_irq_enable local_irq_enable
 #endif
 
 void kvmppc_core_vcpu_load(struct kvm_vcpu *vcpu, int cpu)
@@ -597,12 +595,10 @@ int kvmppc_handle_exit(struct kvm_run *run, struct kvm_vcpu *vcpu,
 	run->exit_reason = KVM_EXIT_UNKNOWN;
 	run->ready_for_interrupt_injection = 1;
 
-	/* We get here with MSR.EE=0, so enable it to be a nice citizen */
-	__hard_irq_enable();
+	/* We get here with MSR.EE=1 */
 
 	trace_kvm_exit(exit_nr, vcpu);
 	kvm_guest_exit();
-	preempt_enable();
 
 	switch (exit_nr) {
 	case BOOK3S_INTERRUPT_INST_STORAGE:
@@ -854,7 +850,6 @@ program_interrupt:
 	}
 	}
 
-	preempt_disable();
 	if (!(r & RESUME_HOST)) {
 		/* To avoid clobbering exit_reason, only check for signals if
 		 * we aren't already exiting to userspace for some other
@@ -866,14 +861,15 @@ program_interrupt:
 		 * and if we really did time things so badly, then we just exit
 		 * again due to a host external interrupt.
 		 */
-		__hard_irq_disable();
+		local_irq_disable();
 		if (kvmppc_prepare_to_enter(vcpu)) {
-			/* local_irq_enable(); */
+			local_irq_enable();
 			run->exit_reason = KVM_EXIT_INTR;
 			r = -EINTR;
 		} else {
 			/* Going back to guest */
 			kvm_guest_enter();
+			kvmppc_lazy_ee_enable();
 		}
 	}
 
@@ -1066,8 +1062,6 @@ int kvmppc_vcpu_run(struct kvm_run *kvm_run, struct kvm_vcpu *vcpu)
 #endif
 	ulong ext_msr;
 
-	preempt_disable();
-
 	/* Check if we can run the vcpu at all */
 	if (!vcpu->arch.sane) {
 		kvm_run->exit_reason = KVM_EXIT_INTERNAL_ERROR;
@@ -1081,9 +1075,9 @@ int kvmppc_vcpu_run(struct kvm_run *kvm_run, struct kvm_vcpu *vcpu)
 	 * really did time things so badly, then we just exit again due to
 	 * a host external interrupt.
 	 */
-	__hard_irq_disable();
+	local_irq_disable();
 	if (kvmppc_prepare_to_enter(vcpu)) {
-		__hard_irq_enable();
+		local_irq_enable();
 		kvm_run->exit_reason = KVM_EXIT_INTR;
 		ret = -EINTR;
 		goto out;
@@ -1122,7 +1116,7 @@ int kvmppc_vcpu_run(struct kvm_run *kvm_run, struct kvm_vcpu *vcpu)
 	if (vcpu->arch.shared->msr & MSR_FP)
 		kvmppc_handle_ext(vcpu, BOOK3S_INTERRUPT_FP_UNAVAIL, MSR_FP);
 
-	kvm_guest_enter();
+	kvmppc_lazy_ee_enable();
 
 	ret = __kvmppc_vcpu_run(kvm_run, vcpu);
 
@@ -1157,7 +1151,6 @@ int kvmppc_vcpu_run(struct kvm_run *kvm_run, struct kvm_vcpu *vcpu)
 
 out:
 	vcpu->mode = OUTSIDE_GUEST_MODE;
-	preempt_enable();
 	return ret;
 }
 
diff --git a/arch/powerpc/kvm/book3s_rmhandlers.S b/arch/powerpc/kvm/book3s_rmhandlers.S
index 9ecf6e3..b2f8258 100644
--- a/arch/powerpc/kvm/book3s_rmhandlers.S
+++ b/arch/powerpc/kvm/book3s_rmhandlers.S
@@ -170,20 +170,21 @@ kvmppc_handler_skip_ins:
  * Call kvmppc_handler_trampoline_enter in real mode
  *
  * On entry, r4 contains the guest shadow MSR
+ * MSR.EE has to be 0 when calling this function
  */
 _GLOBAL(kvmppc_entry_trampoline)
 	mfmsr	r5
 	LOAD_REG_ADDR(r7, kvmppc_handler_trampoline_enter)
 	toreal(r7)
 
-	li	r9, MSR_RI
-	ori	r9, r9, MSR_EE
-	andc	r9, r5, r9	/* Clear EE and RI in MSR value */
 	li	r6, MSR_IR | MSR_DR
-	ori	r6, r6, MSR_EE
-	andc	r6, r5, r6	/* Clear EE, DR and IR in MSR value */
-	MTMSR_EERI(r9)		/* Clear EE and RI in MSR */
-	mtsrr0	r7		/* before we set srr0/1 */
+	andc	r6, r5, r6	/* Clear DR and IR in MSR value */
+	/*
+	 * Set EE in HOST_MSR so that it's enabled when we get into our
+	 * C exit handler function
+	 */
+	ori	r5, r5, MSR_EE
+	mtsrr0	r7
 	mtsrr1	r6
 	RFI
 
diff --git a/arch/powerpc/kvm/booke.c b/arch/powerpc/kvm/booke.c
index aae535f..2bd190c 100644
--- a/arch/powerpc/kvm/booke.c
+++ b/arch/powerpc/kvm/booke.c
@@ -486,6 +486,7 @@ int kvmppc_vcpu_run(struct kvm_run *kvm_run, struct kvm_vcpu *vcpu)
 		ret = -EINTR;
 		goto out;
 	}
+	kvmppc_lazy_ee_enable();
 
 	kvm_guest_enter();
 
@@ -955,6 +956,7 @@ int kvmppc_handle_exit(struct kvm_run *run, struct kvm_vcpu *vcpu,
 		} else {
 			/* Going back to guest */
 			kvm_guest_enter();
+			kvmppc_lazy_ee_enable();
 		}
 	}
 
diff --git a/arch/powerpc/kvm/powerpc.c b/arch/powerpc/kvm/powerpc.c
index 053bfef..545c183 100644
--- a/arch/powerpc/kvm/powerpc.c
+++ b/arch/powerpc/kvm/powerpc.c
@@ -30,6 +30,7 @@
 #include <asm/kvm_ppc.h>
 #include <asm/tlbflush.h>
 #include <asm/cputhreads.h>
+#include <asm/irqflags.h>
 #include "timing.h"
 #include "../mm/mmu_decl.h"
 
@@ -93,6 +94,19 @@ int kvmppc_prepare_to_enter(struct kvm_vcpu *vcpu)
 			break;
 		}
 
+#ifdef CONFIG_PPC64
+		/* lazy EE magic */
+		hard_irq_disable();
+		if (lazy_irq_pending()) {
+			/* Got an interrupt in between, try again */
+			local_irq_enable();
+			local_irq_disable();
+			continue;
+		}
+
+		trace_hardirqs_on();
+#endif
+
 		/* Going into guest context! Yay! */
 		vcpu->mode = IN_GUEST_MODE;
 		smp_wmb();
