diff --git a/spec/display-buffer-spec.coffee b/spec/display-buffer-spec.coffee
index df7c13383..1703a24d1 100644
--- a/spec/display-buffer-spec.coffee
+++ b/spec/display-buffer-spec.coffee
@@ -124,9 +124,42 @@ describe "DisplayBuffer", ->
           expect(displayBuffer.tokenizedLineForScreenRow(3).tokens[1].isHardTab).toBeTruthy()
 
       describe "when a line is wrapped", ->
-        it "correctly tokenizes soft wrap indentation tokens", ->
-          expect(displayBuffer.tokenizedLineForScreenRow(4).tokens[0].isSoftWrapIndentation).toBeTruthy()
-          expect(displayBuffer.tokenizedLineForScreenRow(4).tokens[1].isSoftWrapIndentation).toBeTruthy()
+        it "breaks soft-wrap indentation into a token for each indentation level to support indent guides", ->
+          tokenizedLine = displayBuffer.tokenizedLineForScreenRow(4)
+
+          expect(tokenizedLine.tokens[0].value).toBe("  ")
+          expect(tokenizedLine.tokens[0].isSoftWrapIndentation).toBeTruthy()
+
+          expect(tokenizedLine.tokens[1].value).toBe("  ")
+          expect(tokenizedLine.tokens[1].isSoftWrapIndentation).toBeTruthy()
+
+          expect(tokenizedLine.tokens[2].isSoftWrapIndentation).toBeFalsy()
+
+      describe "when editor.softWrapHangingIndent is set", ->
+        beforeEach ->
+          atom.config.set('editor.softWrapHangingIndent', 3)
+
+        it "further indents wrapped lines", ->
+          expect(displayBuffer.tokenizedLineForScreenRow(10).text).toBe "    return "
+          expect(displayBuffer.tokenizedLineForScreenRow(11).text).toBe "       sort(left).concat(pivot).concat(sort(right)"
+          expect(displayBuffer.tokenizedLineForScreenRow(12).text).toBe "       );"
+
+        it "includes hanging indent when breaking soft-wrap indentation into tokens", ->
+          tokenizedLine = displayBuffer.tokenizedLineForScreenRow(4)
+
+          expect(tokenizedLine.tokens[0].value).toBe("  ")
+          expect(tokenizedLine.tokens[0].isSoftWrapIndentation).toBeTruthy()
+
+          expect(tokenizedLine.tokens[1].value).toBe("  ")
+          expect(tokenizedLine.tokens[1].isSoftWrapIndentation).toBeTruthy()
+
+          expect(tokenizedLine.tokens[2].value).toBe("  ") # hanging indent
+          expect(tokenizedLine.tokens[2].isSoftWrapIndentation).toBeTruthy()
+
+          expect(tokenizedLine.tokens[3].value).toBe(" ") # odd space
+          expect(tokenizedLine.tokens[3].isSoftWrapIndentation).toBeTruthy()
+
+          expect(tokenizedLine.tokens[4].isSoftWrapIndentation).toBeFalsy()
 
     describe "when the buffer changes", ->
       describe "when buffer lines are updated", ->
diff --git a/src/config-schema.coffee b/src/config-schema.coffee
index 1f205ecbf..c2944911b 100644
--- a/src/config-schema.coffee
+++ b/src/config-schema.coffee
@@ -149,6 +149,10 @@ module.exports =
       softWrapAtPreferredLineLength:
         type: 'boolean'
         default: false
+      softWrapHangingIndent:
+        type: 'integer'
+        default: 0
+        minimum: 0
       scrollSensitivity:
         type: 'integer'
         default: 40
diff --git a/src/display-buffer.coffee b/src/display-buffer.coffee
index 5659d38a0..8e8bd8dcd 100644
--- a/src/display-buffer.coffee
+++ b/src/display-buffer.coffee
@@ -69,12 +69,17 @@ class DisplayBuffer extends Model
       scrollPastEnd: atom.config.get('editor.scrollPastEnd', scope: scopeDescriptor)
       softWrap: atom.config.get('editor.softWrap', scope: scopeDescriptor)
       softWrapAtPreferredLineLength: atom.config.get('editor.softWrapAtPreferredLineLength', scope: scopeDescriptor)
+      softWrapHangingIndent: atom.config.get('editor.softWrapHangingIndent', scope: scopeDescriptor)
       preferredLineLength: atom.config.get('editor.preferredLineLength', scope: scopeDescriptor)
 
     subscriptions.add atom.config.onDidChange 'editor.softWrap', scope: scopeDescriptor, ({newValue}) =>
       @configSettings.softWrap = newValue
       @updateWrappedScreenLines()
 
+    subscriptions.add atom.config.onDidChange 'editor.softWrapHangingIndent', scope: scopeDescriptor, ({newValue}) =>
+      @configSettings.softWrapHangingIndent = newValue
+      @updateWrappedScreenLines()
+
     subscriptions.add atom.config.onDidChange 'editor.softWrapAtPreferredLineLength', scope: scopeDescriptor, ({newValue}) =>
       @configSettings.softWrapAtPreferredLineLength = newValue
       @updateWrappedScreenLines() if @isSoftWrapped()
@@ -1157,7 +1162,10 @@ class DisplayBuffer extends Model
         softWraps = 0
         if @isSoftWrapped()
           while wrapScreenColumn = tokenizedLine.findWrapColumn(@getSoftWrapColumn())
-            [wrappedLine, tokenizedLine] = tokenizedLine.softWrapAt(wrapScreenColumn)
+            [wrappedLine, tokenizedLine] = tokenizedLine.softWrapAt(
+              wrapScreenColumn,
+              @configSettings.softWrapHangingIndent
+            )
             break if wrappedLine.hasOnlySoftWrapIndentation()
             screenLines.push(wrappedLine)
             softWraps++
diff --git a/src/tokenized-line.coffee b/src/tokenized-line.coffee
index 3560c35a1..2a807d84a 100644
--- a/src/tokenized-line.coffee
+++ b/src/tokenized-line.coffee
@@ -111,25 +111,18 @@ class TokenizedLine
 
       return maxColumn
 
-  # Calculates how many trailing spaces in this line's indentation cannot fit in a single tab.
-  #
-  # Returns a {Number} representing the odd indentation spaces in this line.
-  getOddIndentationSpaces: ->
-    oddIndentLevel = @indentLevel - Math.floor(@indentLevel)
-    Math.round(@tabLength * oddIndentLevel)
+  buildSoftWrapIndentationTokens: (token, hangingIndent) ->
+    totalIndentSpaces = (@indentLevel * @tabLength) + hangingIndent
+    indentTokens = []
+    while totalIndentSpaces > 0
+      tokenLength = Math.min(@tabLength, totalIndentSpaces)
+      indentToken = token.buildSoftWrapIndentationToken(tokenLength)
+      indentTokens.push(indentToken)
+      totalIndentSpaces -= tokenLength
 
-  buildSoftWrapIndentationTokens: (token) ->
-    indentTokens = [0...Math.floor(@indentLevel)].map =>
-      token.buildSoftWrapIndentationToken(@tabLength)
+    indentTokens
 
-    if @getOddIndentationSpaces()
-      indentTokens.concat(
-        token.buildSoftWrapIndentationToken @getOddIndentationSpaces()
-      )
-    else
-      indentTokens
-
-  softWrapAt: (column) ->
+  softWrapAt: (column, hangingIndent) ->
     return [new TokenizedLine([], '', [0, 0], [0, 0]), this] if column == 0
 
     rightTokens = new Array(@tokens...)
@@ -142,7 +135,7 @@ class TokenizedLine
       leftTextLength += nextToken.value.length
       leftTokens.push nextToken
 
-    indentationTokens = @buildSoftWrapIndentationTokens(leftTokens[0])
+    indentationTokens = @buildSoftWrapIndentationTokens(leftTokens[0], hangingIndent)
 
     leftFragment = new TokenizedLine(
       tokens: leftTokens