diff --git a/core/src/main/java/hudson/Functions.java b/core/src/main/java/hudson/Functions.java
index b60c16a809..649365a5f1 100644
--- a/core/src/main/java/hudson/Functions.java
+++ b/core/src/main/java/hudson/Functions.java
@@ -66,6 +66,7 @@ import hudson.util.Area;
 import hudson.util.Iterators;
 import hudson.scm.SCM;
 import hudson.scm.SCMDescriptor;
+import hudson.util.Secret;
 import org.acegisecurity.providers.anonymous.AnonymousAuthenticationToken;
 import org.apache.commons.jelly.JellyContext;
 import org.apache.commons.jelly.JellyTagException;
@@ -1234,6 +1235,15 @@ public class Functions {
             }
         }
     }
+
+    /**
+     * Used by <f:password/> so that we send an encrypted value to the client.
+     */
+    public String getPasswordValue(Object o) {
+        if (o==null)    return null;
+        if (o instanceof Secret)    return ((Secret)o).getEncryptedValue();
+        return o.toString();
+    }
     
     private static final Pattern SCHEME = Pattern.compile("[a-z]+://.+");
 
diff --git a/core/src/main/resources/lib/form/password.jelly b/core/src/main/resources/lib/form/password.jelly
index fd2a7803f6..b0f71fde18 100644
--- a/core/src/main/resources/lib/form/password.jelly
+++ b/core/src/main/resources/lib/form/password.jelly
@@ -55,7 +55,7 @@ THE SOFTWARE.
   <m:input xmlns:m="jelly:hudson.util.jelly.MorphTagLibrary"
          class="setting-input ${attrs.checkUrl!=null?'validated ':''}${attrs.clazz}"
          name ="${attrs.name ?: '_.'+attrs.field}"
-         value="${attrs.value ?: instance[attrs.field]}"
+         value="${h.getPasswordValue(attrs.value ?: instance[attrs.field])}"
          type="password"
          ATTRIBUTES="${attrs}" EXCEPT="field clazz" />
 </j:jelly>
diff --git a/test/src/test/java/lib/form/PasswordTest.java b/test/src/test/java/lib/form/PasswordTest.java
new file mode 100644
index 0000000000..522f66c8c3
--- /dev/null
+++ b/test/src/test/java/lib/form/PasswordTest.java
@@ -0,0 +1,58 @@
+/*
+ * The MIT License
+ *
+ * Copyright (c) 2004-2010, InfraDNA, Inc.
+ *
+ * Permission is hereby granted, free of charge, to any person obtaining a copy
+ * of this software and associated documentation files (the "Software"), to deal
+ * in the Software without restriction, including without limitation the rights
+ * to use, copy, modify, merge, publish, distribute, sublicense, and/or sell
+ * copies of the Software, and to permit persons to whom the Software is
+ * furnished to do so, subject to the following conditions:
+ *
+ * The above copyright notice and this permission notice shall be included in
+ * all copies or substantial portions of the Software.
+ *
+ * THE SOFTWARE IS PROVIDED "AS IS", WITHOUT WARRANTY OF ANY KIND, EXPRESS OR
+ * IMPLIED, INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF MERCHANTABILITY,
+ * FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT. IN NO EVENT SHALL THE
+ * AUTHORS OR COPYRIGHT HOLDERS BE LIABLE FOR ANY CLAIM, DAMAGES OR OTHER
+ * LIABILITY, WHETHER IN AN ACTION OF CONTRACT, TORT OR OTHERWISE, ARISING FROM,
+ * OUT OF OR IN CONNECTION WITH THE SOFTWARE OR THE USE OR OTHER DEALINGS IN
+ * THE SOFTWARE.
+ */
+package lib.form;
+
+import com.gargoylesoftware.htmlunit.html.HtmlInput;
+import com.gargoylesoftware.htmlunit.html.HtmlPage;
+import hudson.Extension;
+import hudson.model.Describable;
+import hudson.model.Descriptor;
+import hudson.util.Secret;
+import org.jvnet.hudson.test.HudsonTestCase;
+
+/**
+ * @author Kohsuke Kawaguchi
+ */
+public class PasswordTest extends HudsonTestCase implements Describable<PasswordTest> {
+    public Secret secret;
+
+    public void test1() throws Exception {
+        secret = Secret.fromString("secret");
+        HtmlPage p = createWebClient().goTo("self/test1");
+        String value = ((HtmlInput)p.getElementById("password")).getValueAttribute();
+        assertFalse("password shouldn't be plain text",value.equals("secret"));
+        assertEquals("secret",Secret.fromString(value).getPlainText());
+    }
+
+    public DescriptorImpl getDescriptor() {
+        return hudson.getDescriptorByType(DescriptorImpl.class);
+    }
+
+    @Extension
+    public static final class DescriptorImpl extends Descriptor<PasswordTest> {
+        public String getDisplayName() {
+            return null;
+        }
+    }
+}
diff --git a/test/src/test/resources/lib/form/PasswordTest/test1.jelly b/test/src/test/resources/lib/form/PasswordTest/test1.jelly
new file mode 100644
index 0000000000..bdd2cc0ca4
--- /dev/null
+++ b/test/src/test/resources/lib/form/PasswordTest/test1.jelly
@@ -0,0 +1,40 @@
+<!--
+The MIT License
+
+Copyright (c) 2010, InfraDNA, Inc.
+
+Permission is hereby granted, free of charge, to any person obtaining a copy
+of this software and associated documentation files (the "Software"), to deal
+in the Software without restriction, including without limitation the rights
+to use, copy, modify, merge, publish, distribute, sublicense, and/or sell
+copies of the Software, and to permit persons to whom the Software is
+furnished to do so, subject to the following conditions:
+
+The above copyright notice and this permission notice shall be included in
+all copies or substantial portions of the Software.
+
+THE SOFTWARE IS PROVIDED "AS IS", WITHOUT WARRANTY OF ANY KIND, EXPRESS OR
+IMPLIED, INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF MERCHANTABILITY,
+FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT. IN NO EVENT SHALL THE
+AUTHORS OR COPYRIGHT HOLDERS BE LIABLE FOR ANY CLAIM, DAMAGES OR OTHER
+LIABILITY, WHETHER IN AN ACTION OF CONTRACT, TORT OR OTHERWISE, ARISING FROM,
+OUT OF OR IN CONNECTION WITH THE SOFTWARE OR THE USE OR OTHER DEALINGS IN
+THE SOFTWARE.
+-->
+
+<!--
+  Config page
+-->
+<j:jelly xmlns:j="jelly:core" xmlns:st="jelly:stapler" xmlns:d="jelly:define" xmlns:l="/lib/layout" xmlns:t="/lib/hudson" xmlns:f="/lib/form">
+<l:layout title="Making sure the password field gets an encrypted value">
+  <l:main-panel>
+    <f:form method="post" name="config" action="thisFormWillNotBeSubmitted">
+      <j:set var="instance" value="${it}" />
+      <j:set var="descriptor" value="${it.descriptor}" />
+      <f:entry field="secret">
+        <f:password id="password" />
+      </f:entry>
+    </f:form>
+  </l:main-panel>
+</l:layout>
+</j:jelly>