diff --git a/.python-version b/.python-version
index 4712731cc..ecc17b8e9 100644
--- a/.python-version
+++ b/.python-version
@@ -1 +1 @@
-2.7.12
+2.7.13
diff --git a/package.json b/package.json
index 92a9920e3..21f78352e 100644
--- a/package.json
+++ b/package.json
@@ -118,7 +118,7 @@
     "go-to-line": "0.32.0",
     "grammar-selector": "0.49.2",
     "image-view": "0.61.0",
-    "incompatible-packages": "0.26.1",
+    "incompatible-packages": "0.27.0",
     "keybinding-resolver": "0.36.1",
     "line-ending-selector": "0.6.1",
     "link": "0.31.2",
diff --git a/src/atom-environment.coffee b/src/atom-environment.coffee
index 86753a999..dae45f7a2 100644
--- a/src/atom-environment.coffee
+++ b/src/atom-environment.coffee
@@ -694,8 +694,14 @@ class AtomEnvironment extends Model
         @deserialize(state) if state?
         @deserializeTimings.atom = Date.now() - startTime
 
-        if process.platform is 'darwin' and @config.get('core.useCustomTitleBar')
+        if process.platform is 'darwin' and @config.get('core.titleBar') is 'custom'
           @workspace.addHeaderPanel({item: new TitleBar({@workspace, @themes, @applicationDelegate})})
+          @document.body.classList.add('custom-title-bar')
+        if process.platform is 'darwin' and @config.get('core.titleBar') is 'custom-inset'
+          @workspace.addHeaderPanel({item: new TitleBar({@workspace, @themes, @applicationDelegate})})
+          @document.body.classList.add('custom-inset-title-bar')
+        if process.platform is 'darwin' and @config.get('core.titleBar') is 'hidden'
+          @document.body.classList.add('hidden-title-bar')
 
         @document.body.appendChild(@views.getView(@workspace))
         @backgroundStylesheet?.remove()
diff --git a/src/config-schema.js b/src/config-schema.js
index 9bfa95a1a..41b5ecbb6 100644
--- a/src/config-schema.js
+++ b/src/config-schema.js
@@ -498,10 +498,11 @@ if (['win32', 'linux'].includes(process.platform)) {
 }
 
 if (process.platform === 'darwin') {
-  configSchema.core.properties.useCustomTitleBar = {
-    type: 'boolean',
-    default: false,
-    description: 'Use custom, theme-aware title bar.<br>Note: This currently does not include a proxy icon.<br>This setting will require a relaunch of Atom to take effect.'
+  configSchema.core.properties.titleBar = {
+    type: 'string',
+    default: 'native',
+    enum: ['native', 'custom', 'custom-inset', 'hidden'],
+    description: 'Experimental: A `custom` title bar adapts to theme colors. Choosing `custom-inset` adds a bit more padding. The title bar can also be completely `hidden`.<br>Note: Switching to a custom or hidden title bar will compromise some functionality.<br>This setting will require a relaunch of Atom to take effect.'
   }
 }
 
diff --git a/src/main-process/atom-application.coffee b/src/main-process/atom-application.coffee
index e2515ccb9..93e9e3395 100644
--- a/src/main-process/atom-application.coffee
+++ b/src/main-process/atom-application.coffee
@@ -84,7 +84,13 @@ class AtomApplication
   initialize: (options) ->
     global.atomApplication = this
 
-    @config.onDidChange 'core.useCustomTitleBar', @promptForRestart.bind(this)
+    # DEPRECATED: This can be removed at some point (added in 1.13)
+    # It converts `useCustomTitleBar: true` to `titleBar: "custom"`
+    if process.platform is 'darwin' and @config.get('core.useCustomTitleBar')
+      @config.unset('core.useCustomTitleBar')
+      @config.set('core.titleBar', 'custom')
+    
+    @config.onDidChange 'core.titleBar', @promptForRestart.bind(this)
 
     @autoUpdateManager = new AutoUpdateManager(
       @version, options.test or options.benchmark or options.benchmarkTest, @resourcePath, @config
diff --git a/src/main-process/atom-window.coffee b/src/main-process/atom-window.coffee
index f3a9b394c..03386d31a 100644
--- a/src/main-process/atom-window.coffee
+++ b/src/main-process/atom-window.coffee
@@ -43,9 +43,15 @@ class AtomWindow
     if process.platform is 'linux'
       options.icon = @constructor.iconPath
 
-    if @shouldHideTitleBar()
+    if @shouldAddCustomTitleBar()
       options.titleBarStyle = 'hidden'
 
+    if @shouldAddCustomInsetTitleBar()
+      options.titleBarStyle = 'hidden-inset'
+
+    if @shouldHideTitleBar()
+      options.frame = false
+
     @browserWindow = new BrowserWindow(options)
     @handleEvents()
 
@@ -226,10 +232,20 @@ class AtomWindow
     [width, height] = @browserWindow.getSize()
     {x, y, width, height}
 
+  shouldAddCustomTitleBar: ->
+    not @isSpec and
+    process.platform is 'darwin' and
+    @atomApplication.config.get('core.titleBar') is 'custom'
+
+  shouldAddCustomInsetTitleBar: ->
+    not @isSpec and
+    process.platform is 'darwin' and
+    @atomApplication.config.get('core.titleBar') is 'custom-inset'
+
   shouldHideTitleBar: ->
     not @isSpec and
     process.platform is 'darwin' and
-    @atomApplication.config.get('core.useCustomTitleBar')
+    @atomApplication.config.get('core.titleBar') is 'hidden'
 
   close: -> @browserWindow.close()
 
diff --git a/static/title-bar.less b/static/title-bar.less
index 8191bc278..3eb2c4022 100644
--- a/static/title-bar.less
+++ b/static/title-bar.less
@@ -1,30 +1,32 @@
 @import "ui-variables";
 
+@title-bar-height:           22px;
+@traffic-lights-width:       68px;
+
+@inset-title-bar-height:     38px;
+@inset-traffic-lights-width: 78px;
+
 @title-bar-text-size: 13px;
-@title-bar-height: 23px;
 @title-bar-background-color: @base-background-color;
 @title-bar-border-color: @base-border-color;
 
-body.fullscreen .title-bar {
-  margin-top: -@title-bar-height;
-}
+
+// Title Bar -------------------------------
 
 .title-bar {
-  height: @title-bar-height;
-  transition: margin-top 160ms;
-
-  flex-shrink: 0;
   display: flex;
+  flex-shrink: 0;
   align-items: center;
   justify-content: center;
-
+  overflow: hidden;
+  box-sizing: content-box;
   font-size: @title-bar-text-size;
+  background-color: @title-bar-background-color;
+  border-bottom: 1px solid @title-bar-border-color;
+  transition: margin-top 160ms;
   -webkit-user-select: none;
   -webkit-app-region: drag;
 
-  padding: 0 70px;
-  overflow: hidden;
-
   .title {
     flex: 0 1 auto;
     overflow: hidden;
@@ -32,10 +34,54 @@ body.fullscreen .title-bar {
     text-overflow: ellipsis;
   }
 
-  background-color: @title-bar-background-color;
-  border-bottom: 1px solid @title-bar-border-color;
-
   .is-blurred & {
     color: @text-color-subtle;
   }
 }
+
+
+// Custom -------------------------------
+
+.custom-title-bar {
+  .title-bar {
+    height: @title-bar-height;
+    padding-left: @traffic-lights-width;
+    padding-right: @traffic-lights-width;
+  }
+
+  &.fullscreen .title-bar {
+    margin-top: -@title-bar-height; // hide title bar in fullscreen mode
+  }
+
+  atom-panel.modal {
+    top: @title-bar-height; // Move modals down
+  }
+}
+
+
+// Custom Inset -------------------------------
+
+.custom-inset-title-bar {
+  .title-bar {
+    height: @inset-title-bar-height;
+    padding-left: @inset-traffic-lights-width;
+    padding-right: @inset-traffic-lights-width;
+  }
+
+  &.fullscreen .title-bar {
+    margin-top: -@inset-title-bar-height; // hide title bar in fullscreen mode
+  }
+
+  atom-panel.modal {
+    top: @inset-title-bar-height; // Move modals down
+  }
+}
+
+
+// Hidden -------------------------------
+
+.hidden-title-bar {
+  .status-bar {
+    -webkit-app-region: drag; // Enable dragging
+  }
+}