diff --git a/core/src/main/java/hudson/ProxyConfiguration.java b/core/src/main/java/hudson/ProxyConfiguration.java
index 8b951c80d7..b6baa4d54b 100644
--- a/core/src/main/java/hudson/ProxyConfiguration.java
+++ b/core/src/main/java/hudson/ProxyConfiguration.java
@@ -23,25 +23,34 @@
  */
 package hudson;
 
-import com.thoughtworks.xstream.XStream;
 import hudson.model.Hudson;
 import hudson.model.Saveable;
-import hudson.util.XStream2;
 import hudson.util.Scrambler;
+import hudson.util.XStream2;
 
 import java.io.File;
 import java.io.IOException;
+import java.net.Authenticator;
 import java.net.InetSocketAddress;
+import java.net.PasswordAuthentication;
 import java.net.Proxy;
-import java.net.URLConnection;
 import java.net.URL;
+import java.net.URLConnection;
+
+import com.thoughtworks.xstream.XStream;
 
 /**
  * HTTP proxy configuration.
  *
  * <p>
  * Use {@link #open(URL)} to open a connection with the proxy setting.
- *
+ * <p>
+ * Proxy authentication (including NTLM) is implemented by setting a default
+ * {@link Authenticator} which provides a {@link PasswordAuthentication}
+ * (as described in the Java 6 tech note 
+ * <a href="http://java.sun.com/javase/6/docs/technotes/guides/net/http-auth.html">
+ * Http Authentication</a>).
+ * 
  * @see Hudson#proxy
  */
 public final class ProxyConfiguration implements Saveable {
@@ -101,8 +110,14 @@ public final class ProxyConfiguration implements Saveable {
 
         URLConnection con = url.openConnection(p.createProxy());
         if(p.getUserName()!=null) {
-            con.setRequestProperty("Proxy-Authorization","Basic "+
-                    Scrambler.scramble(p.getUserName()+':'+p.getPassword()));
+        	// Add an authenticator which provides the credentials for proxy authentication
+            Authenticator.setDefault(new Authenticator() {
+                public PasswordAuthentication getPasswordAuthentication() {
+                    ProxyConfiguration p = Hudson.getInstance().proxy;
+                    return new PasswordAuthentication(p.getUserName(),
+                            p.getPassword().toCharArray());
+                }
+            });
         }
         return con;
     }
diff --git a/core/src/main/resources/hudson/PluginManager/advanced.jelly b/core/src/main/resources/hudson/PluginManager/advanced.jelly
index a328198fd2..b3fdee5455 100644
--- a/core/src/main/resources/hudson/PluginManager/advanced.jelly
+++ b/core/src/main/resources/hudson/PluginManager/advanced.jelly
@@ -45,7 +45,7 @@ THE SOFTWARE.
                 <f:textbox name="proxy.port" value="${app.proxy.port}" />
               </f:entry>
             </f:block>
-            <f:entry title="${%User name}">
+            <f:entry title="${%User name}" help="/help/update-center/proxy-username.html>
               <f:textbox name="proxy.userName" value="${app.proxy.userName}" />
             </f:entry>
             <f:entry title="${%Password}">