diff --git a/src/init.cpp b/src/init.cpp
index 1be25203c..64f91a349 100644
--- a/src/init.cpp
+++ b/src/init.cpp
@@ -300,6 +300,7 @@ std::string HelpMessage()
         "  -rpcallowip=<ip>       " + _("Allow JSON-RPC connections from specified IP address") + "\n" +
         "  -rpcconnect=<ip>       " + _("Send commands to node running on <ip> (default: 127.0.0.1)") + "\n" +
         "  -blocknotify=<cmd>     " + _("Execute command when the best block changes (%s in cmd is replaced by block hash)") + "\n" +
+        "  -walletnotify=<cmd>    " + _("Execute command when a wallet transaction changes (%s in cmd is replaced by TxID)") + "\n" +
         "  -upgradewallet         " + _("Upgrade wallet to latest format") + "\n" +
         "  -keypool=<n>           " + _("Set key pool size to <n> (default: 100)") + "\n" +
         "  -rescan                " + _("Rescan the block chain for missing wallet transactions") + "\n" +
diff --git a/src/wallet.cpp b/src/wallet.cpp
index 2317ac31a..3892e4b80 100644
--- a/src/wallet.cpp
+++ b/src/wallet.cpp
@@ -8,6 +8,7 @@
 #include "crypter.h"
 #include "ui_interface.h"
 #include "base58.h"
+#include <boost/algorithm/string/replace.hpp>
 
 using namespace std;
 
@@ -476,6 +477,16 @@ bool CWallet::AddToWallet(const CWalletTx& wtxIn)
 
         // Notify UI of new or updated transaction
         NotifyTransactionChanged(this, hash, fInsertedNew ? CT_NEW : CT_UPDATED);
+
+        // notify an external script when a wallet transaction comes in or is updated
+        std::string strCmd = GetArg("-walletnotify", "");
+
+        if ( !strCmd.empty())
+        {
+            boost::replace_all(strCmd, "%s", wtxIn.GetHash().GetHex());
+            boost::thread t(runCommand, strCmd); // thread runs free
+        }
+
     }
     return true;
 }