diff --git a/build/yarn.lock b/build/yarn.lock
index b98261cbfc1..8114b6d8e55 100644
--- a/build/yarn.lock
+++ b/build/yarn.lock
@@ -392,13 +392,6 @@ ansi-styles@^2.2.1:
   resolved "https://registry.yarnpkg.com/ansi-styles/-/ansi-styles-2.2.1.tgz#b432dd3358b634cf75e1e4664368240533c1ddbe"
   integrity sha1-tDLdM1i2NM914eRmQ2gkBTPB3b4=
 
-ansi-styles@^3.2.1:
-  version "3.2.1"
-  resolved "https://registry.yarnpkg.com/ansi-styles/-/ansi-styles-3.2.1.tgz#41fbb20243e50b12be0f04b8dedbf07520ce841d"
-  integrity sha512-VT0ZI6kZRdTh8YyJw3SMbYm/u+NqfsAxEpWO0Pf9sq8/e94WxxOpPKx9FR1FlyCtOVDNOQ+8ntlqFxiRc+r5qA==
-  dependencies:
-    color-convert "^1.9.0"
-
 ansi-wrap@0.1.0:
   version "0.1.0"
   resolved "https://registry.yarnpkg.com/ansi-wrap/-/ansi-wrap-0.1.0.tgz#a82250ddb0015e9a27ca82e82ea603bbfa45efaf"
@@ -522,15 +515,6 @@ azure-storage@^2.1.0:
     xml2js "0.2.7"
     xmlbuilder "0.4.3"
 
-babel-code-frame@^6.22.0:
-  version "6.26.0"
-  resolved "https://registry.yarnpkg.com/babel-code-frame/-/babel-code-frame-6.26.0.tgz#63fd43f7dc1e3bb7ce35947db8fe369a3f58c74b"
-  integrity sha1-Y/1D99weO7fONZR9uP42mj9Yx0s=
-  dependencies:
-    chalk "^1.1.3"
-    esutils "^2.0.2"
-    js-tokens "^3.0.2"
-
 balanced-match@^1.0.0:
   version "1.0.0"
   resolved "https://registry.yarnpkg.com/balanced-match/-/balanced-match-1.0.0.tgz#89b4d199ab2bee49de164ea02b89ce462d71b767"
@@ -604,17 +588,12 @@ buffer-from@^1.0.0:
   resolved "https://registry.yarnpkg.com/buffer-from/-/buffer-from-1.1.1.tgz#32713bc028f75c02fdb710d7c7bcec1f2c6070ef"
   integrity sha512-MQcXEUbCKtEo7bhqEs6560Hyd4XaovZlO/k9V3hjVUF/zwW7KBVdSK4gIt/bzwS9MbR5qob+F5jusZsb0YQK2A==
 
-builtin-modules@^1.1.1:
-  version "1.1.1"
-  resolved "https://registry.yarnpkg.com/builtin-modules/-/builtin-modules-1.1.1.tgz#270f076c5a72c02f5b65a47df94c5fe3a278892f"
-  integrity sha1-Jw8HbFpywC9bZaR9+Uxf46J4iS8=
-
 caseless@~0.12.0:
   version "0.12.0"
   resolved "https://registry.yarnpkg.com/caseless/-/caseless-0.12.0.tgz#1b681c21ff84033c826543090689420d187151dc"
   integrity sha1-G2gcIf+EAzyCZUMJBolCDRhxUdw=
 
-chalk@^1.0.0, chalk@^1.1.3:
+chalk@^1.0.0:
   version "1.1.3"
   resolved "https://registry.yarnpkg.com/chalk/-/chalk-1.1.3.tgz#a8115c55e4a702fe4d150abd3872822a7e09fc98"
   integrity sha1-qBFcVeSnAv5NFQq9OHKCKn4J/Jg=
@@ -625,15 +604,6 @@ chalk@^1.0.0, chalk@^1.1.3:
     strip-ansi "^3.0.0"
     supports-color "^2.0.0"
 
-chalk@^2.3.0:
-  version "2.4.1"
-  resolved "https://registry.yarnpkg.com/chalk/-/chalk-2.4.1.tgz#18c49ab16a037b6eb0152cc83e3471338215b66e"
-  integrity sha512-ObN6h1v2fTJSmUXoS3nMQ92LbDK9be4TV+6G+omQlGJFdcUX5heKi1LZ1YnRMIgwTLEj3E24bT6tYni50rlCfQ==
-  dependencies:
-    ansi-styles "^3.2.1"
-    escape-string-regexp "^1.0.5"
-    supports-color "^5.3.0"
-
 cheerio@^1.0.0-rc.1:
   version "1.0.0-rc.2"
   resolved "https://registry.yarnpkg.com/cheerio/-/cheerio-1.0.0-rc.2.tgz#4b9f53a81b27e4d5dac31c0ffd0cfa03cc6830db"
@@ -666,18 +636,6 @@ code-block-writer@9.4.1:
   resolved "https://registry.yarnpkg.com/code-block-writer/-/code-block-writer-9.4.1.tgz#1448fca79dfc7a3649000f4c85be6bc770604c4c"
   integrity sha512-LHAB+DL4YZDcwK8y/kAxZ0Lf/ncwLh/Ux4cTVWbPwIdrf1gPxXiPcwpz8r8/KqXu1aD+Raz46EOxDjFlbyO6bA==
 
-color-convert@^1.9.0:
-  version "1.9.3"
-  resolved "https://registry.yarnpkg.com/color-convert/-/color-convert-1.9.3.tgz#bb71850690e1f136567de629d2d5471deda4c1e8"
-  integrity sha512-QfAUtd+vFdAtFQcC8CCyYt1fYWxSqAiK2cSD6zDB8N3cpsEBAvRxp9zOGg6G/SHHJYAT88/az/IuDGALsNVbGg==
-  dependencies:
-    color-name "1.1.3"
-
-color-name@1.1.3:
-  version "1.1.3"
-  resolved "https://registry.yarnpkg.com/color-name/-/color-name-1.1.3.tgz#a7d0558bd89c42f795dd42328f740831ca53bc25"
-  integrity sha1-p9BVi9icQveV3UIyj3QIMcpTvCU=
-
 color-support@^1.1.3:
   version "1.1.3"
   resolved "https://registry.yarnpkg.com/color-support/-/color-support-1.1.3.tgz#93834379a1cc9a0c61f82f52f0d04322251bd5a2"
@@ -712,16 +670,16 @@ command-line-args@^5.1.1:
     lodash.camelcase "^4.3.0"
     typical "^4.0.0"
 
-commander@^2.12.1, commander@^2.8.1:
-  version "2.19.0"
-  resolved "https://registry.yarnpkg.com/commander/-/commander-2.19.0.tgz#f6198aa84e5b83c46054b94ddedbfed5ee9ff12a"
-  integrity sha512-6tvAOO+D6OENvRAh524Dh9jcfKTYDQAqvqezbCW82xj5X0pSrcpxtvRKHLG0yBY6SD7PSDrJaj+0AiOcKVd1Xg==
-
 commander@^2.20.0, commander@~2.20.0:
   version "2.20.0"
   resolved "https://registry.yarnpkg.com/commander/-/commander-2.20.0.tgz#d58bb2b5c1ee8f87b0d340027e9e94e222c5a422"
   integrity sha512-7j2y+40w61zy6YC2iRNpUe/NwhNyoXrYpHMrSunaMG64nRnaf96zO/KMQR4OyN/UnE5KLyEBnKHd4aG3rskjpQ==
 
+commander@^2.8.1:
+  version "2.19.0"
+  resolved "https://registry.yarnpkg.com/commander/-/commander-2.19.0.tgz#f6198aa84e5b83c46054b94ddedbfed5ee9ff12a"
+  integrity sha512-6tvAOO+D6OENvRAh524Dh9jcfKTYDQAqvqezbCW82xj5X0pSrcpxtvRKHLG0yBY6SD7PSDrJaj+0AiOcKVd1Xg==
+
 concat-map@0.0.1:
   version "0.0.1"
   resolved "https://registry.yarnpkg.com/concat-map/-/concat-map-0.0.1.tgz#d8a96bd77fd68df7793a73036a3ba0d5405d477b"
@@ -856,11 +814,6 @@ diagnostic-channel@0.2.0:
   dependencies:
     semver "^5.3.0"
 
-diff@^3.2.0:
-  version "3.5.0"
-  resolved "https://registry.yarnpkg.com/diff/-/diff-3.5.0.tgz#800c0dd1e0a8bfbc95835c202ad220fe317e5a12"
-  integrity sha512-A46qtFgd+g7pDZinpnwiRJtxbC1hpgf0uzP3iG89scHk0AUC7A1TGxf5OiiOUv/JMZR8GOt8hL900hV0bOy5xA==
-
 dir-glob@^3.0.1:
   version "3.0.1"
   resolved "https://registry.yarnpkg.com/dir-glob/-/dir-glob-3.0.1.tgz#56dbf73d992a4a93ba1584f4534063fd2e41717f"
@@ -940,7 +893,7 @@ entities@^1.1.1, entities@~1.1.1:
   resolved "https://registry.yarnpkg.com/entities/-/entities-1.1.2.tgz#bdfa735299664dfafd34529ed4f8522a275fea56"
   integrity sha512-f2LZMYl1Fzu7YSBKg+RoROelpOaNrcGmE9AZubeDfrCEia483oW4MI4VyFd5VNHIgQ/7qm1I0wUHK1eJnn2y2w==
 
-escape-string-regexp@^1.0.2, escape-string-regexp@^1.0.5:
+escape-string-regexp@^1.0.2:
   version "1.0.5"
   resolved "https://registry.yarnpkg.com/escape-string-regexp/-/escape-string-regexp-1.0.5.tgz#1b61c0562190a8dff6ae3bb2cf0200ca130b86d4"
   integrity sha1-G2HAViGQqN/2rjuyzwIAyhMLhtQ=
@@ -958,11 +911,6 @@ eslint-visitor-keys@^1.1.0:
   resolved "https://registry.yarnpkg.com/eslint-visitor-keys/-/eslint-visitor-keys-1.1.0.tgz#e2a82cea84ff246ad6fb57f9bde5b46621459ec2"
   integrity sha512-8y9YjtM1JBJU/A9Kc+SbaOV4y29sSWckBwMHa+FGtVj5gN/sbnKDf6xJUl+8g7FAij9LVaP8C24DUiH/f/2Z9A==
 
-esprima@^4.0.0:
-  version "4.0.1"
-  resolved "https://registry.yarnpkg.com/esprima/-/esprima-4.0.1.tgz#13b04cdb3e6c5d19df91ab6987a8695619b0aa71"
-  integrity sha512-eGuFFw7Upda+g4p+QHvnW0RyTX/SVeJBDM/gCtMARO0cLuT2HcEKnTPvhjV6aGeqrCB/sbNop0Kszm0jsaWU4A==
-
 esrecurse@^4.1.0:
   version "4.2.1"
   resolved "https://registry.yarnpkg.com/esrecurse/-/esrecurse-4.2.1.tgz#007a3b9fdbc2b3bb87e4879ea19c92fdbd3942cf"
@@ -975,11 +923,6 @@ estraverse@^4.1.0, estraverse@^4.1.1:
   resolved "https://registry.yarnpkg.com/estraverse/-/estraverse-4.3.0.tgz#398ad3f3c5a24948be7725e83d11a7de28cdbd1d"
   integrity sha512-39nnKffWz8xN1BU/2c79n9nB9HDzo0niYUqx6xyqUnyoAnQyyWpOTdZEeiCch8BBu515t4wp9ZmgVfVhn9EBpw==
 
-esutils@^2.0.2:
-  version "2.0.2"
-  resolved "https://registry.yarnpkg.com/esutils/-/esutils-2.0.2.tgz#0abf4f1caa5bcb1f7a9d8acc6dea4faaa04bac9b"
-  integrity sha1-Cr9PHKpbyx96nYrMbepPqqBLrJs=
-
 execa@^1.0.0:
   version "1.0.0"
   resolved "https://registry.yarnpkg.com/execa/-/execa-1.0.0.tgz#c6236a5bb4df6d6f15e88e7f017798216749ddd8"
@@ -1143,7 +1086,7 @@ glob-parent@^5.0.0:
   dependencies:
     is-glob "^4.0.1"
 
-glob@^7.0.6, glob@^7.1.1:
+glob@^7.0.6:
   version "7.1.3"
   resolved "https://registry.yarnpkg.com/glob/-/glob-7.1.3.tgz#3960832d3f1574108342dafd3a67b332c0969df1"
   integrity sha512-vcfuiIxogLV4DlGBHIUOwI0IbrJ8HWPc4MU7HzviGeNho/UJDfi6B5p3sHeWIQ0KGIU0Jpxi5ZHxemQfLkkAwQ==
@@ -1315,11 +1258,6 @@ has-ansi@^2.0.0:
   dependencies:
     ansi-regex "^2.0.0"
 
-has-flag@^3.0.0:
-  version "3.0.0"
-  resolved "https://registry.yarnpkg.com/has-flag/-/has-flag-3.0.0.tgz#b5d454dc2199ae225699f3467e5a07f3b955bafd"
-  integrity sha1-tdRU3CGZriJWmfNGfloH87lVuv0=
-
 has-gulplog@^0.1.0:
   version "0.1.0"
   resolved "https://registry.yarnpkg.com/has-gulplog/-/has-gulplog-0.1.0.tgz#6414c82913697da51590397dafb12f22967811ce"
@@ -1528,19 +1466,6 @@ isstream@~0.1.2:
   resolved "https://registry.yarnpkg.com/isstream/-/isstream-0.1.2.tgz#47e63f7af55afa6f92e1500e690eb8b8529c099a"
   integrity sha1-R+Y/evVa+m+S4VAOaQ64uFKcCZo=
 
-js-tokens@^3.0.2:
-  version "3.0.2"
-  resolved "https://registry.yarnpkg.com/js-tokens/-/js-tokens-3.0.2.tgz#9866df395102130e38f7f996bceb65443209c25b"
-  integrity sha1-mGbfOVECEw449/mWvOtlRDIJwls=
-
-js-yaml@^3.7.0:
-  version "3.12.0"
-  resolved "https://registry.yarnpkg.com/js-yaml/-/js-yaml-3.12.0.tgz#eaed656ec8344f10f527c6bfa1b6e2244de167d1"
-  integrity sha512-PIt2cnwmPfL4hKNwqeiuz4bKfnzHTBv6HyVgjahA6mPLwPDzjDWrplJBMjHUFxku/N3FlmrbyPclad+I+4mJ3A==
-  dependencies:
-    argparse "^1.0.7"
-    esprima "^4.0.0"
-
 jsbn@~0.1.0:
   version "0.1.1"
   resolved "https://registry.yarnpkg.com/jsbn/-/jsbn-0.1.1.tgz#a5e654c2e5a2deb5f201d96cefbca80c0ef2f513"
@@ -1982,11 +1907,6 @@ path-key@^2.0.0, path-key@^2.0.1:
   resolved "https://registry.yarnpkg.com/path-key/-/path-key-2.0.1.tgz#411cadb574c5a140d3a4b1910d40d80cc9f40b40"
   integrity sha1-QRyttXTFoUDTpLGRDUDYDMn0C0A=
 
-path-parse@^1.0.5:
-  version "1.0.6"
-  resolved "https://registry.yarnpkg.com/path-parse/-/path-parse-1.0.6.tgz#d62dbb5679405d72c4737ec58600e9ddcf06d24c"
-  integrity sha512-GSmOT2EbHrINBf9SR7CDELwlJ8AENk3Qn7OikK4nFYAu3Ote2+JYNVvkpAEQm3/TLNEJFD/xZJjzyxg3KBWOzw==
-
 path-type@^4.0.0:
   version "4.0.0"
   resolved "https://registry.yarnpkg.com/path-type/-/path-type-4.0.0.tgz#84ed01c0a7ba380afe09d90a8c180dcd9d03043b"
@@ -2185,13 +2105,6 @@ resolve-url@^0.2.1:
   resolved "https://registry.yarnpkg.com/resolve-url/-/resolve-url-0.2.1.tgz#2c637fe77c893afd2a663fe21aa9080068e2052a"
   integrity sha1-LGN/53yJOv0qZj/iGqkIAGjiBSo=
 
-resolve@^1.3.2:
-  version "1.8.1"
-  resolved "https://registry.yarnpkg.com/resolve/-/resolve-1.8.1.tgz#82f1ec19a423ac1fbd080b0bab06ba36e84a7a26"
-  integrity sha512-AicPrAC7Qu1JxPCZ9ZgCZlY35QgFnNqc+0LtbRNxnVw4TXvjQ72wnuL9JQcEBgXkI9JM8MsT9kaQoHcpCRJOYA==
-  dependencies:
-    path-parse "^1.0.5"
-
 reusify@^1.0.0:
   version "1.0.4"
   resolved "https://registry.yarnpkg.com/reusify/-/reusify-1.0.4.tgz#90da382b1e126efc02146e90845a88db12925d76"
@@ -2388,13 +2301,6 @@ supports-color@^2.0.0:
   resolved "https://registry.yarnpkg.com/supports-color/-/supports-color-2.0.0.tgz#535d045ce6b6363fa40117084629995e9df324c7"
   integrity sha1-U10EXOa2Nj+kARcIRimZXp3zJMc=
 
-supports-color@^5.3.0:
-  version "5.5.0"
-  resolved "https://registry.yarnpkg.com/supports-color/-/supports-color-5.5.0.tgz#e2e69a44ac8772f78a1ec0b35b689df6530efc8f"
-  integrity sha512-QjVjwdXIt408MIiAqCX4oUKsgU2EqAGzs2Ppkm4aQYbjm+ZEWEcW4SfFNTr4uMNZma0ey4f5lgLrkB0aX0QMow==
-  dependencies:
-    has-flag "^3.0.0"
-
 terser@*:
   version "4.2.1"
   resolved "https://registry.yarnpkg.com/terser/-/terser-4.2.1.tgz#1052cfe17576c66e7bc70fcc7119f22b155bdac1"
@@ -2468,7 +2374,7 @@ ts-morph@^3.1.3:
     multimatch "^4.0.0"
     typescript "^3.0.1"
 
-tslib@^1.8.0, tslib@^1.8.1:
+tslib@^1.8.1:
   version "1.9.3"
   resolved "https://registry.yarnpkg.com/tslib/-/tslib-1.9.3.tgz#d7e4dd79245d85428c4d7e4822a79917954ca286"
   integrity sha512-4krF8scpejhaOgqzBEcGM7yDIEfi0/8+8zDRZhNZZ2kjmHJ4hv3zCbQWxoJGz1iw5U0Jl0nma13xzHXcncMavQ==
@@ -2478,31 +2384,6 @@ tslib@^1.9.3:
   resolved "https://registry.yarnpkg.com/tslib/-/tslib-1.10.0.tgz#c3c19f95973fb0a62973fb09d90d961ee43e5c8a"
   integrity sha512-qOebF53frne81cf0S9B41ByenJ3/IuH8yJKngAX35CmiZySA0khhkovshKK+jGCaMnVomla7gVlIcc3EvKPbTQ==
 
-tslint@^5.9.1:
-  version "5.11.0"
-  resolved "https://registry.yarnpkg.com/tslint/-/tslint-5.11.0.tgz#98f30c02eae3cde7006201e4c33cb08b48581eed"
-  integrity sha1-mPMMAurjzecAYgHkwzywi0hYHu0=
-  dependencies:
-    babel-code-frame "^6.22.0"
-    builtin-modules "^1.1.1"
-    chalk "^2.3.0"
-    commander "^2.12.1"
-    diff "^3.2.0"
-    glob "^7.1.1"
-    js-yaml "^3.7.0"
-    minimatch "^3.0.4"
-    resolve "^1.3.2"
-    semver "^5.3.0"
-    tslib "^1.8.0"
-    tsutils "^2.27.2"
-
-tsutils@^2.27.2:
-  version "2.29.0"
-  resolved "https://registry.yarnpkg.com/tsutils/-/tsutils-2.29.0.tgz#32b488501467acbedd4b85498673a0812aca0b99"
-  integrity sha512-g5JVHCIJwzfISaXpXE1qvNalca5Jwob6FjI4AoPlqMusJ6ftFE7IkkFoMhVLRgK+4Kx3gkzb8UZK5t5yTTvEmA==
-  dependencies:
-    tslib "^1.8.1"
-
 tsutils@^3.17.1:
   version "3.17.1"
   resolved "https://registry.yarnpkg.com/tsutils/-/tsutils-3.17.1.tgz#ed719917f11ca0dee586272b2ac49e015a2dd759"
diff --git a/src/vs/editor/common/config/editorOptions.ts b/src/vs/editor/common/config/editorOptions.ts
index 6014a86c1f6..b472101432e 100644
--- a/src/vs/editor/common/config/editorOptions.ts
+++ b/src/vs/editor/common/config/editorOptions.ts
@@ -465,7 +465,7 @@ export interface IEditorOptions {
 	 */
 	codeActionsOnSaveTimeout?: number;
 	/**
-	 * Enable code folding
+	 * Enable code folding.
 	 * Defaults to true.
 	 */
 	folding?: boolean;
@@ -474,6 +474,11 @@ export interface IEditorOptions {
 	 * Defaults to 'auto'.
 	 */
 	foldingStrategy?: 'auto' | 'indentation';
+	/**
+	 * Enable highlight for folded regions.
+	 * Defaults to true.
+	 */
+	foldingHighlight?: boolean;
 	/**
 	 * Controls whether the fold actions in the gutter stay always visible or hide unless the mouse is over the gutter.
 	 * Defaults to 'mouseover'.
@@ -3083,6 +3088,7 @@ export const enum EditorOption {
 	fixedOverflowWidgets,
 	folding,
 	foldingStrategy,
+	foldingHighlight,
 	fontFamily,
 	fontInfo,
 	fontLigatures,
@@ -3350,6 +3356,10 @@ export const EditorOptions = {
 		['auto', 'indentation'] as const,
 		{ markdownDescription: nls.localize('foldingStrategy', "Controls the strategy for computing folding ranges. `auto` uses a language specific folding strategy, if available. `indentation` uses the indentation based folding strategy.") }
 	)),
+	foldingHighlight: register(new EditorBooleanOption(
+		EditorOption.foldingHighlight, 'foldingHighlight', true,
+		{ description: nls.localize('foldingHighlight', "Controls whether the editor should highlight folded ranges.") }
+	)),
 	fontFamily: register(new EditorStringOption(
 		EditorOption.fontFamily, 'fontFamily', EDITOR_FONT_DEFAULTS.fontFamily,
 		{ description: nls.localize('fontFamily', "Controls the font family.") }
diff --git a/src/vs/editor/contrib/folding/folding.ts b/src/vs/editor/contrib/folding/folding.ts
index 1af69c1cfb5..e1bbbf1b520 100644
--- a/src/vs/editor/contrib/folding/folding.ts
+++ b/src/vs/editor/contrib/folding/folding.ts
@@ -59,7 +59,6 @@ export class FoldingController extends Disposable implements IEditorContribution
 
 	private readonly editor: ICodeEditor;
 	private _isEnabled: boolean;
-	private _autoHideFoldingControls: boolean;
 	private _useFoldingProviders: boolean;
 
 	private readonly foldingDecorationProvider: FoldingDecorationProvider;
@@ -89,7 +88,6 @@ export class FoldingController extends Disposable implements IEditorContribution
 		this.editor = editor;
 		const options = this.editor.getOptions();
 		this._isEnabled = options.get(EditorOption.folding);
-		this._autoHideFoldingControls = options.get(EditorOption.showFoldingControls) === 'mouseover';
 		this._useFoldingProviders = options.get(EditorOption.foldingStrategy) !== 'indentation';
 
 		this.foldingModel = null;
@@ -103,32 +101,30 @@ export class FoldingController extends Disposable implements IEditorContribution
 		this.mouseDownInfo = null;
 
 		this.foldingDecorationProvider = new FoldingDecorationProvider(editor);
-		this.foldingDecorationProvider.autoHideFoldingControls = this._autoHideFoldingControls;
+		this.foldingDecorationProvider.autoHideFoldingControls = options.get(EditorOption.showFoldingControls) === 'mouseover';
+		this.foldingDecorationProvider.showFoldingHighlights = options.get(EditorOption.foldingHighlight);
 		this.foldingEnabled = CONTEXT_FOLDING_ENABLED.bindTo(this.contextKeyService);
 		this.foldingEnabled.set(this._isEnabled);
 
 		this._register(this.editor.onDidChangeModel(() => this.onModelChanged()));
 
 		this._register(this.editor.onDidChangeConfiguration((e: ConfigurationChangedEvent) => {
-			if (e.hasChanged(EditorOption.folding) || e.hasChanged(EditorOption.showFoldingControls) || e.hasChanged(EditorOption.foldingStrategy)) {
-				let oldIsEnabled = this._isEnabled;
+			if (e.hasChanged(EditorOption.folding)) {
 				const options = this.editor.getOptions();
 				this._isEnabled = options.get(EditorOption.folding);
 				this.foldingEnabled.set(this._isEnabled);
-				if (oldIsEnabled !== this._isEnabled) {
-					this.onModelChanged();
-				}
-				let oldShowFoldingControls = this._autoHideFoldingControls;
-				this._autoHideFoldingControls = options.get(EditorOption.showFoldingControls) === 'mouseover';
-				if (oldShowFoldingControls !== this._autoHideFoldingControls) {
-					this.foldingDecorationProvider.autoHideFoldingControls = this._autoHideFoldingControls;
-					this.onModelContentChanged();
-				}
-				let oldUseFoldingProviders = this._useFoldingProviders;
+				this.onModelChanged();
+			}
+			if (e.hasChanged(EditorOption.showFoldingControls) || e.hasChanged(EditorOption.foldingHighlight)) {
+				const options = this.editor.getOptions();
+				this.foldingDecorationProvider.autoHideFoldingControls = options.get(EditorOption.showFoldingControls) === 'mouseover';
+				this.foldingDecorationProvider.showFoldingHighlights = options.get(EditorOption.foldingHighlight);
+				this.onModelContentChanged();
+			}
+			if (e.hasChanged(EditorOption.foldingStrategy)) {
+				const options = this.editor.getOptions();
 				this._useFoldingProviders = options.get(EditorOption.foldingStrategy) !== 'indentation';
-				if (oldUseFoldingProviders !== this._useFoldingProviders) {
-					this.onFoldingStrategyChanged();
-				}
+				this.onFoldingStrategyChanged();
 			}
 		}));
 		this.onModelChanged();
diff --git a/src/vs/editor/contrib/folding/foldingDecorations.ts b/src/vs/editor/contrib/folding/foldingDecorations.ts
index e3bbec8ae67..0ec51779f72 100644
--- a/src/vs/editor/contrib/folding/foldingDecorations.ts
+++ b/src/vs/editor/contrib/folding/foldingDecorations.ts
@@ -11,6 +11,12 @@ import { ICodeEditor } from 'vs/editor/browser/editorBrowser';
 export class FoldingDecorationProvider implements IDecorationProvider {
 
 	private static readonly COLLAPSED_VISUAL_DECORATION = ModelDecorationOptions.register({
+		stickiness: TrackedRangeStickiness.NeverGrowsWhenTypingAtEdges,
+		afterContentClassName: 'inline-folded',
+		linesDecorationsClassName: 'codicon codicon-chevron-right'
+	});
+
+	private static readonly COLLAPSED_HIGHLIGHTED_VISUAL_DECORATION = ModelDecorationOptions.register({
 		stickiness: TrackedRangeStickiness.NeverGrowsWhenTypingAtEdges,
 		afterContentClassName: 'inline-folded',
 		className: 'folded-background',
@@ -30,12 +36,14 @@ export class FoldingDecorationProvider implements IDecorationProvider {
 
 	public autoHideFoldingControls: boolean = true;
 
+	public showFoldingHighlights: boolean = true;
+
 	constructor(private readonly editor: ICodeEditor) {
 	}
 
 	getDecorationOption(isCollapsed: boolean): ModelDecorationOptions {
 		if (isCollapsed) {
-			return FoldingDecorationProvider.COLLAPSED_VISUAL_DECORATION;
+			return this.showFoldingHighlights ? FoldingDecorationProvider.COLLAPSED_HIGHLIGHTED_VISUAL_DECORATION : FoldingDecorationProvider.COLLAPSED_VISUAL_DECORATION;
 		} else if (this.autoHideFoldingControls) {
 			return FoldingDecorationProvider.EXPANDED_AUTO_HIDE_VISUAL_DECORATION;
 		} else {
diff --git a/src/vs/monaco.d.ts b/src/vs/monaco.d.ts
index 27cece82f20..ba1514ee999 100644
--- a/src/vs/monaco.d.ts
+++ b/src/vs/monaco.d.ts
@@ -2861,7 +2861,7 @@ declare namespace monaco.editor {
 		 */
 		codeActionsOnSaveTimeout?: number;
 		/**
-		 * Enable code folding
+		 * Enable code folding.
 		 * Defaults to true.
 		 */
 		folding?: boolean;
@@ -2870,6 +2870,11 @@ declare namespace monaco.editor {
 		 * Defaults to 'auto'.
 		 */
 		foldingStrategy?: 'auto' | 'indentation';
+		/**
+		 * Enable highlight for folded regions.
+		 * Defaults to true.
+		 */
+		foldingHighlight?: boolean;
 		/**
 		 * Controls whether the fold actions in the gutter stay always visible or hide unless the mouse is over the gutter.
 		 * Defaults to 'mouseover'.
diff --git a/yarn.lock b/yarn.lock
index 464ac72bb3d..12071935831 100644
--- a/yarn.lock
+++ b/yarn.lock
@@ -126,11 +126,6 @@
   resolved "https://registry.yarnpkg.com/@types/eslint-visitor-keys/-/eslint-visitor-keys-1.0.0.tgz#1ee30d79544ca84d68d4b3cdb0af4f205663dd2d"
   integrity sha512-OCutwjDZ4aFS6PB1UZ988C4YgwlBHJd6wCeQqaLdmadZ/7e+w79+hbMUFC1QXDNCmdyoRfAFdm0RypzwR+Qpag==
 
-"@types/fancy-log@1.3.0":
-  version "1.3.0"
-  resolved "https://registry.yarnpkg.com/@types/fancy-log/-/fancy-log-1.3.0.tgz#a61ab476e5e628cd07a846330df53b85e05c8ce0"
-  integrity sha512-mQjDxyOM1Cpocd+vm1kZBP7smwKZ4TNokFeds9LV7OZibmPJFEzY3+xZMrKfUdNT71lv8GoCPD6upKwHxubClw==
-
 "@types/graceful-fs@4.1.2":
   version "4.1.2"
   resolved "https://registry.yarnpkg.com/@types/graceful-fs/-/graceful-fs-4.1.2.tgz#fbc9575dbcc6d1d91dd768d30c5fc0c19f6c50bd"
@@ -1400,7 +1395,7 @@ buffers@~0.1.1:
   resolved "https://registry.yarnpkg.com/buffers/-/buffers-0.1.1.tgz#b24579c3bed4d6d396aeee6d9a8ae7f5482ab7bb"
   integrity sha1-skV5w77U1tOWru5tmorn9Ugqt7s=
 
-builtin-modules@^1.0.0, builtin-modules@^1.1.1:
+builtin-modules@^1.0.0:
   version "1.1.1"
   resolved "https://registry.yarnpkg.com/builtin-modules/-/builtin-modules-1.1.1.tgz#270f076c5a72c02f5b65a47df94c5fe3a278892f"
   integrity sha1-Jw8HbFpywC9bZaR9+Uxf46J4iS8=
@@ -1509,15 +1504,6 @@ chainsaw@~0.1.0:
   dependencies:
     traverse ">=0.3.0 <0.4"
 
-chalk@2.3.1:
-  version "2.3.1"
-  resolved "https://registry.yarnpkg.com/chalk/-/chalk-2.3.1.tgz#523fe2678aec7b04e8041909292fe8b17059b796"
-  integrity sha512-QUU4ofkDoMIVO7hcx1iPTISs88wsO8jA92RQIm4JAwZvFGGAV2hSAA1NX7oVj2Ej2Q6NDTcRDjPTFrMCRZoJ6g==
-  dependencies:
-    ansi-styles "^3.2.0"
-    escape-string-regexp "^1.0.5"
-    supports-color "^5.2.0"
-
 chalk@2.4.2, chalk@^2.1.0, chalk@^2.4.2:
   version "2.4.2"
   resolved "https://registry.yarnpkg.com/chalk/-/chalk-2.4.2.tgz#cd42541677a54333cf541a49108c1432b44c9424"
@@ -1904,16 +1890,16 @@ commander@2.3.0:
   resolved "https://registry.yarnpkg.com/commander/-/commander-2.3.0.tgz#fd430e889832ec353b9acd1de217c11cb3eef873"
   integrity sha1-/UMOiJgy7DU7ms0d4hfBHLPu+HM=
 
-commander@^2.12.1, commander@~2.13.0:
-  version "2.13.0"
-  resolved "https://registry.yarnpkg.com/commander/-/commander-2.13.0.tgz#6964bca67685df7c1f1430c584f07d7597885b9c"
-  integrity sha512-MVuS359B+YzaWqjCL/c+22gfryv+mCBPHAv3zyVI2GN8EY6IRP8VwtasXn8jyyhvvq84R4ImN1OKRtcbIasjYA==
-
 commander@^2.19.0:
   version "2.19.0"
   resolved "https://registry.yarnpkg.com/commander/-/commander-2.19.0.tgz#f6198aa84e5b83c46054b94ddedbfed5ee9ff12a"
   integrity sha512-6tvAOO+D6OENvRAh524Dh9jcfKTYDQAqvqezbCW82xj5X0pSrcpxtvRKHLG0yBY6SD7PSDrJaj+0AiOcKVd1Xg==
 
+commander@~2.13.0:
+  version "2.13.0"
+  resolved "https://registry.yarnpkg.com/commander/-/commander-2.13.0.tgz#6964bca67685df7c1f1430c584f07d7597885b9c"
+  integrity sha512-MVuS359B+YzaWqjCL/c+22gfryv+mCBPHAv3zyVI2GN8EY6IRP8VwtasXn8jyyhvvq84R4ImN1OKRtcbIasjYA==
+
 commander@~2.20.0:
   version "2.20.0"
   resolved "https://registry.yarnpkg.com/commander/-/commander-2.20.0.tgz#d58bb2b5c1ee8f87b0d340027e9e94e222c5a422"
@@ -2499,11 +2485,6 @@ diff@1.4.0:
   resolved "https://registry.yarnpkg.com/diff/-/diff-1.4.0.tgz#7f28d2eb9ee7b15a97efd89ce63dcfdaa3ccbabf"
   integrity sha1-fyjS657nsVqX79ic5j3P2qPMur8=
 
-diff@^3.2.0:
-  version "3.4.0"
-  resolved "https://registry.yarnpkg.com/diff/-/diff-3.4.0.tgz#b1d85507daf3964828de54b37d0d73ba67dda56c"
-  integrity sha512-QpVuMTEoJMF7cKzi6bvWhRulU1fZqZnvyVQgNhPaxxuTYwyjn/j1v9falseQ/uXWwPnO56RBfwtg4h/EQXmucA==
-
 diffie-hellman@^5.0.0:
   version "5.0.3"
   resolved "https://registry.yarnpkg.com/diffie-hellman/-/diffie-hellman-5.0.3.tgz#40e8ee98f55a2149607146921c63e1ae5f3d2875"
@@ -3220,7 +3201,7 @@ extsprintf@1.3.0, extsprintf@^1.2.0:
   resolved "https://registry.yarnpkg.com/extsprintf/-/extsprintf-1.3.0.tgz#96918440e3041a7a414f8c52e3c574eb3c3e1e05"
   integrity sha1-lpGEQOMEGnpBT4xS48V06zw+HgU=
 
-fancy-log@1.3.2, fancy-log@^1.3.2:
+fancy-log@^1.3.2:
   version "1.3.2"
   resolved "https://registry.yarnpkg.com/fancy-log/-/fancy-log-1.3.2.tgz#f41125e3d84f2e7d89a43d06d958c8f78be16be1"
   integrity sha1-9BEl49hPLn2JpD0G2VjI94vha+E=
@@ -4191,18 +4172,6 @@ gulp-tsb@4.0.5:
     through "^2.3.6"
     vinyl "^2.1.0"
 
-gulp-tslint@^8.1.3:
-  version "8.1.3"
-  resolved "https://registry.yarnpkg.com/gulp-tslint/-/gulp-tslint-8.1.3.tgz#a89ed144038ae861ee7bfea9528272d126a93da1"
-  integrity sha512-KEP350N5B9Jg6o6jnyCyKVBPemJePYpMsGfIQq0G0ErvY7tw4Lrfb/y3L4WRf7ek0OsaE8nnj86w+lcLXW8ovw==
-  dependencies:
-    "@types/fancy-log" "1.3.0"
-    chalk "2.3.1"
-    fancy-log "1.3.2"
-    map-stream "~0.0.7"
-    plugin-error "1.0.1"
-    through "~2.3.8"
-
 gulp-untar@^0.0.7:
   version "0.0.7"
   resolved "https://registry.yarnpkg.com/gulp-untar/-/gulp-untar-0.0.7.tgz#92067d79e0fa1e92d60562a100233a44a5aa08b4"
@@ -5194,7 +5163,7 @@ js-yaml@^3.12.0:
     argparse "^1.0.7"
     esprima "^4.0.0"
 
-js-yaml@^3.13.0, js-yaml@^3.13.1:
+js-yaml@^3.13.1:
   version "3.13.1"
   resolved "https://registry.yarnpkg.com/js-yaml/-/js-yaml-3.13.1.tgz#aff151b30bfdfa8e49e05da22e7415e9dfa37847"
   integrity sha512-YfbcO7jXDdyj0DGxYVSlSeQNHbD7XPWvrVWeVUujrQEoZzWJIRrCPoyk6kL6IAjAG2IolMK4T0hNUe0HOUs5Jw==
@@ -5704,7 +5673,7 @@ map-obj@^1.0.0, map-obj@^1.0.1:
   resolved "https://registry.yarnpkg.com/map-obj/-/map-obj-1.0.1.tgz#d933ceb9205d82bdcf4886f6742bdc2b4dea146d"
   integrity sha1-2TPOuSBdgr3PSIb2dCvcK03qFG0=
 
-map-stream@0.0.7, map-stream@~0.0.7:
+map-stream@0.0.7:
   version "0.0.7"
   resolved "https://registry.yarnpkg.com/map-stream/-/map-stream-0.0.7.tgz#8a1f07896d82b10926bd3744a2420009f88974a8"
   integrity sha1-ih8HiW2CsQkmvTdEokIACfiJdKg=
@@ -7007,7 +6976,7 @@ plugin-error@0.1.2, plugin-error@^0.1.2:
     arr-union "^2.0.1"
     extend-shallow "^1.1.2"
 
-plugin-error@1.0.1, plugin-error@^1.0.1:
+plugin-error@^1.0.1:
   version "1.0.1"
   resolved "https://registry.yarnpkg.com/plugin-error/-/plugin-error-1.0.1.tgz#77016bd8919d0ac377fdcdd0322328953ca5781c"
   integrity sha512-L1zP0dk7vGweZME2i+EeakvUNqSrdiI3F91TwEoYiGrAfUXmVv6fJIq4g82PAXxNsWOp0J7ZqQy/3Szz0ajTxA==
@@ -7957,7 +7926,7 @@ resolve-url@^0.2.1:
   resolved "https://registry.yarnpkg.com/resolve-url/-/resolve-url-0.2.1.tgz#2c637fe77c893afd2a663fe21aa9080068e2052a"
   integrity sha1-LGN/53yJOv0qZj/iGqkIAGjiBSo=
 
-resolve@^1.1.6, resolve@^1.1.7, resolve@^1.3.2:
+resolve@^1.1.6, resolve@^1.1.7:
   version "1.5.0"
   resolved "https://registry.yarnpkg.com/resolve/-/resolve-1.5.0.tgz#1f09acce796c9a762579f31b2c1cc4c3cddf9f36"
   integrity sha512-hgoSGrc3pjzAPHNBg+KnFcK2HwlHTs/YrAGUr6qgTVUZmXv1UEXXl0bZNBKMA9fud6lRYFdPGz0xXxycPzmmiw==
@@ -8802,13 +8771,6 @@ supports-color@^4.0.0:
   dependencies:
     has-flag "^2.0.0"
 
-supports-color@^5.2.0:
-  version "5.5.0"
-  resolved "https://registry.yarnpkg.com/supports-color/-/supports-color-5.5.0.tgz#e2e69a44ac8772f78a1ec0b35b689df6530efc8f"
-  integrity sha512-QjVjwdXIt408MIiAqCX4oUKsgU2EqAGzs2Ppkm4aQYbjm+ZEWEcW4SfFNTr4uMNZma0ey4f5lgLrkB0aX0QMow==
-  dependencies:
-    has-flag "^3.0.0"
-
 supports-color@^5.3.0:
   version "5.4.0"
   resolved "https://registry.yarnpkg.com/supports-color/-/supports-color-5.4.0.tgz#1c6b337402c2137605efe19f10fec390f6faab54"
@@ -8978,7 +8940,7 @@ through2@~0.4.0:
     readable-stream "~1.0.17"
     xtend "~2.1.1"
 
-through@2, through@^2.3.6, through@^2.3.8, through@~2.3, through@~2.3.1, through@~2.3.4, through@~2.3.8:
+through@2, through@^2.3.6, through@^2.3.8, through@~2.3, through@~2.3.1, through@~2.3.4:
   version "2.3.8"
   resolved "https://registry.yarnpkg.com/through/-/through-2.3.8.tgz#0dd4c9ffaabc357960b1b724115d7e0e86a2e1f5"
   integrity sha1-DdTJ/6q8NXlgsbckEV1+Doai4fU=
@@ -9138,42 +9100,11 @@ ts-loader@^4.4.2:
     micromatch "^3.1.4"
     semver "^5.0.1"
 
-tslib@^1.8.0:
-  version "1.9.0"
-  resolved "https://registry.yarnpkg.com/tslib/-/tslib-1.9.0.tgz#e37a86fda8cbbaf23a057f473c9f4dc64e5fc2e8"
-  integrity sha512-f/qGG2tUkrISBlQZEjEqoZ3B2+npJjIf04H1wuAv9iA8i04Icp+61KRXxFdha22670NJopsZCIjhC3SnjPRKrQ==
-
 tslib@^1.8.1, tslib@^1.9.0:
   version "1.9.3"
   resolved "https://registry.yarnpkg.com/tslib/-/tslib-1.9.3.tgz#d7e4dd79245d85428c4d7e4822a79917954ca286"
   integrity sha512-4krF8scpejhaOgqzBEcGM7yDIEfi0/8+8zDRZhNZZ2kjmHJ4hv3zCbQWxoJGz1iw5U0Jl0nma13xzHXcncMavQ==
 
-tslint@^5.16.0:
-  version "5.16.0"
-  resolved "https://registry.yarnpkg.com/tslint/-/tslint-5.16.0.tgz#ae61f9c5a98d295b9a4f4553b1b1e831c1984d67"
-  integrity sha512-UxG2yNxJ5pgGwmMzPMYh/CCnCnh0HfPgtlVRDs1ykZklufFBL1ZoTlWFRz2NQjcoEiDoRp+JyT0lhBbbH/obyA==
-  dependencies:
-    "@babel/code-frame" "^7.0.0"
-    builtin-modules "^1.1.1"
-    chalk "^2.3.0"
-    commander "^2.12.1"
-    diff "^3.2.0"
-    glob "^7.1.1"
-    js-yaml "^3.13.0"
-    minimatch "^3.0.4"
-    mkdirp "^0.5.1"
-    resolve "^1.3.2"
-    semver "^5.3.0"
-    tslib "^1.8.0"
-    tsutils "^2.29.0"
-
-tsutils@^2.29.0:
-  version "2.29.0"
-  resolved "https://registry.yarnpkg.com/tsutils/-/tsutils-2.29.0.tgz#32b488501467acbedd4b85498673a0812aca0b99"
-  integrity sha512-g5JVHCIJwzfISaXpXE1qvNalca5Jwob6FjI4AoPlqMusJ6ftFE7IkkFoMhVLRgK+4Kx3gkzb8UZK5t5yTTvEmA==
-  dependencies:
-    tslib "^1.8.1"
-
 tsutils@^3.17.1:
   version "3.17.1"
   resolved "https://registry.yarnpkg.com/tsutils/-/tsutils-3.17.1.tgz#ed719917f11ca0dee586272b2ac49e015a2dd759"