diff --git a/spec/atom/editor-spec.coffee b/spec/atom/editor-spec.coffee
index f69abb81b..90e0cf6c3 100644
--- a/spec/atom/editor-spec.coffee
+++ b/spec/atom/editor-spec.coffee
@@ -757,11 +757,13 @@ describe "Editor", ->
 
   describe "folding", ->
     describe "when a fold-selection event is triggered", ->
-      it "folds the selected text and moves the cursor to just after the placeholder", ->
+      it "folds the selected text and moves the cursor to just after the placeholder, then treats the placeholder as a single character", ->
         editor.selection.setBufferRange(new Range([4, 29], [7, 4]))
-
         editor.trigger 'fold-selection'
+
         expect(editor.lines.find('.line:eq(4)').find('.fold-placeholder')).toExist()
+        expect(editor.lines.find('.line:eq(5)').text()).toBe '    return sort(left).concat(pivot).concat(sort(right));'
+
         expect(editor.selection.isEmpty()).toBeTruthy()
         expect(editor.getCursorScreenPosition()).toEqual [4, 32]
 
@@ -777,4 +779,14 @@ describe "Editor", ->
         editor.moveCursorRight()
         expect(editor.getCursorScreenPosition()).toEqual [4, 32]
 
+    describe "when a fold placeholder is clicked", ->
+      it "removes the associated fold", ->
+        editor.selection.setBufferRange(new Range([4, 29], [7, 4]))
+        editor.trigger 'fold-selection'
+
+        editor.find('.fold-placeholder .ellipsis').mousedown()
+
+        expect(editor.find('.fold-placeholder')).not.toExist()
+        expect(editor.lines.find('.line:eq(5)').text()).toBe '      current = items.shift();'
+
 
diff --git a/src/atom/editor.coffee b/src/atom/editor.coffee
index d498a5b03..cbdaecddf 100644
--- a/src/atom/editor.coffee
+++ b/src/atom/editor.coffee
@@ -92,6 +92,10 @@ class Editor extends View
       @hiddenInput.focus()
       false
 
+    @on 'mousedown', '.fold-placeholder', (e) =>
+      @lineFolder.destroyFoldById($(e.currentTarget).attr('foldId'))
+      false
+
     @on 'mousedown', (e) =>
       clickCount = e.originalEvent.detail
 
@@ -130,7 +134,7 @@ class Editor extends View
         if tokens.length
           for token in tokens
             if token.type is 'fold-placeholder'
-              @span '   ', class: 'fold-placeholder', style: "width: #{3 * charWidth}px; height: #{charHeight * .85 }px;", =>
+              @span '   ', class: 'fold-placeholder', style: "width: #{3 * charWidth}px; height: #{charHeight * .85 }px;", 'foldId': token.fold.id, =>
                 @div class: "ellipsis", => @raw "…"
             else
               @span { class: token.type.replace('.', ' ') }, token.value
diff --git a/src/atom/line-folder.coffee b/src/atom/line-folder.coffee
index 719e4b24b..9e26b600b 100644
--- a/src/atom/line-folder.coffee
+++ b/src/atom/line-folder.coffee
@@ -7,11 +7,14 @@ EventEmitter = require 'event-emitter'
 
 module.exports =
 class LineFolder
+  activeFolds: null
+  foldsById: null
   lineMap: null
   lastHighlighterChangeEvent: null
 
   constructor: (@highlighter) ->
     @activeFolds = {}
+    @foldsById = {}
     @buildLineMap()
     @highlighter.buffer.on 'change', (e) => @handleBufferChange(e)
     @highlighter.on 'change', (e) => @lastHighlighterChangeEvent = e
@@ -57,13 +60,18 @@ class LineFolder
     @trigger 'change', oldRange: oldScreenRange, newRange: newScreenRange
     @trigger 'unfold', fold.getRange()
 
+  destroyFoldById: (foldId) ->
+    @foldsById[foldId]?.destroy()
+
   registerFold: (bufferRow, fold) ->
     @activeFolds[bufferRow] ?= []
     @activeFolds[bufferRow].push(fold)
+    @foldsById[fold.id] = fold
 
   unregisterFold: (bufferRow, fold) ->
     folds = @activeFolds[bufferRow]
     folds.splice(folds.indexOf(fold), 1)
+    delete @foldsById[fold.id]
 
   handleBufferChange: (e) ->
     for row, folds of @activeFolds
@@ -102,7 +110,7 @@ class LineFolder
     screenLine
 
   buildFoldPlaceholder: (fold) ->
-    new ScreenLineFragment([{value: '...', type: 'fold-placeholder'}], '...', [0, 3], fold.getRange().toDelta(), isAtomic: true)
+    new ScreenLineFragment([{value: '...', type: 'fold-placeholder', fold}], '...', [0, 3], fold.getRange().toDelta(), isAtomic: true)
 
   foldsForBufferRow: (bufferRow) ->
     @activeFolds[bufferRow] or []
@@ -150,7 +158,10 @@ class LineFolder
 _.extend LineFolder.prototype, EventEmitter
 
 class Fold
+  @idCounter: 1
+
   constructor: (@lineFolder, {@start, @end}) ->
+    @id = @constructor.idCounter++
 
   destroy: ->
     @lineFolder.destroyFold(this)