diff --git a/qa/rpc-tests/rawtransactions.py b/qa/rpc-tests/rawtransactions.py
index df02c1697..aa403f058 100755
--- a/qa/rpc-tests/rawtransactions.py
+++ b/qa/rpc-tests/rawtransactions.py
@@ -138,5 +138,11 @@ class RawTransactionsTest(BitcoinTestFramework):
         self.sync_all()
         assert_equal(self.nodes[0].getbalance(), bal+Decimal('50.00000000')+Decimal('2.19000000')) #block reward + tx
 
+        inputs  = [ {'txid' : "1d1d4e24ed99057e84c3f80fd8fbec79ed9e1acee37da269356ecea000000000", 'vout' : 1, 'sequence' : 1000}]
+        outputs = { self.nodes[0].getnewaddress() : 1 }
+        rawtx   = self.nodes[0].createrawtransaction(inputs, outputs)
+        decrawtx= self.nodes[0].decoderawtransaction(rawtx)
+        assert_equal(decrawtx['vin'][0]['sequence'], 1000)
+
 if __name__ == '__main__':
     RawTransactionsTest().main()
diff --git a/src/bitcoin-tx.cpp b/src/bitcoin-tx.cpp
index 95d7a085a..d5e2fc279 100644
--- a/src/bitcoin-tx.cpp
+++ b/src/bitcoin-tx.cpp
@@ -71,7 +71,7 @@ static bool AppInitRawTx(int argc, char* argv[])
         strUsage = HelpMessageGroup(_("Commands:"));
         strUsage += HelpMessageOpt("delin=N", _("Delete input N from TX"));
         strUsage += HelpMessageOpt("delout=N", _("Delete output N from TX"));
-        strUsage += HelpMessageOpt("in=TXID:VOUT", _("Add input to TX"));
+        strUsage += HelpMessageOpt("in=TXID:VOUT(:SEQUENCE_NUMBER)", _("Add input to TX"));
         strUsage += HelpMessageOpt("locktime=N", _("Set TX lock time to N"));
         strUsage += HelpMessageOpt("nversion=N", _("Set TX version to N"));
         strUsage += HelpMessageOpt("outaddr=VALUE:ADDRESS", _("Add address-based output to TX"));
@@ -181,15 +181,15 @@ static void MutateTxLocktime(CMutableTransaction& tx, const string& cmdVal)
 
 static void MutateTxAddInput(CMutableTransaction& tx, const string& strInput)
 {
+    std::vector<std::string> vStrInputParts;
+    boost::split(vStrInputParts, strInput, boost::is_any_of(":"));
+
     // separate TXID:VOUT in string
-    size_t pos = strInput.find(':');
-    if ((pos == string::npos) ||
-        (pos == 0) ||
-        (pos == (strInput.size() - 1)))
+    if (vStrInputParts.size()<2)
         throw runtime_error("TX input missing separator");
 
     // extract and validate TXID
-    string strTxid = strInput.substr(0, pos);
+    string strTxid = vStrInputParts[0];
     if ((strTxid.size() != 64) || !IsHex(strTxid))
         throw runtime_error("invalid TX input txid");
     uint256 txid(uint256S(strTxid));
@@ -198,13 +198,18 @@ static void MutateTxAddInput(CMutableTransaction& tx, const string& strInput)
     static const unsigned int maxVout = MAX_BLOCK_SIZE / minTxOutSz;
 
     // extract and validate vout
-    string strVout = strInput.substr(pos + 1, string::npos);
+    string strVout = vStrInputParts[1];
     int vout = atoi(strVout);
     if ((vout < 0) || (vout > (int)maxVout))
         throw runtime_error("invalid TX input vout");
 
+    // extract the optional sequence number
+    uint32_t nSequenceIn=std::numeric_limits<unsigned int>::max();
+    if (vStrInputParts.size() > 2)
+        nSequenceIn = atoi(vStrInputParts[2]);
+
     // append to transaction input list
-    CTxIn txin(txid, vout);
+    CTxIn txin(txid, vout, CScript(), nSequenceIn);
     tx.vin.push_back(txin);
 }
 
diff --git a/src/rpc/rawtransaction.cpp b/src/rpc/rawtransaction.cpp
index 32b4ad47f..4517ffcbb 100644
--- a/src/rpc/rawtransaction.cpp
+++ b/src/rpc/rawtransaction.cpp
@@ -334,6 +334,7 @@ UniValue createrawtransaction(const UniValue& params, bool fHelp)
             "       {\n"
             "         \"txid\":\"id\",    (string, required) The transaction id\n"
             "         \"vout\":n        (numeric, required) The output number\n"
+            "         \"sequence\":n    (numeric, optional) The sequence number\n"
             "       }\n"
             "       ,...\n"
             "     ]\n"
@@ -384,6 +385,12 @@ UniValue createrawtransaction(const UniValue& params, bool fHelp)
             throw JSONRPCError(RPC_INVALID_PARAMETER, "Invalid parameter, vout must be positive");
 
         uint32_t nSequence = (rawTx.nLockTime ? std::numeric_limits<uint32_t>::max() - 1 : std::numeric_limits<uint32_t>::max());
+
+        // set the sequence number if passed in the parameters object
+        const UniValue& sequenceObj = find_value(o, "sequence");
+        if (sequenceObj.isNum())
+            nSequence = sequenceObj.get_int();
+
         CTxIn in(COutPoint(txid, nOutput), CScript(), nSequence);
 
         rawTx.vin.push_back(in);
diff --git a/src/test/data/bitcoin-util-test.json b/src/test/data/bitcoin-util-test.json
index 3bf80ca43..5cb383de8 100644
--- a/src/test/data/bitcoin-util-test.json
+++ b/src/test/data/bitcoin-util-test.json
@@ -86,5 +86,18 @@
      "outaddr=0.18:13tuJJDR2RgArmgfv6JScSdreahzgc4T6o",
      "outdata=54686973204f505f52455455524e207472616e73616374696f6e206f7574707574207761732063726561746564206279206d6f646966696564206372656174657261777472616e73616374696f6e2e"],
     "output_cmp": "txcreatedata2.hex"
+  },
+  { "exec": "./bitcoin-tx",
+    "args":
+    ["-create",
+     "in=5897de6bd6027a475eadd57019d4e6872c396d0716c4875a5f1a6fcfdf385c1f:0:4294967293",
+     "outaddr=0.18:13tuJJDR2RgArmgfv6JScSdreahzgc4T6o"],
+    "output_cmp": "txcreatedata_seq0.hex"
+  },
+  { "exec": "./bitcoin-tx",
+    "args":
+    ["01000000011f5c38dfcf6f1a5f5a87c416076d392c87e6d41970d5ad5e477a02d66bde97580000000000fdffffff0180a81201000000001976a9141fc11f39be1729bf973a7ab6a615ca4729d6457488ac00000000",
+     "in=5897de6bd6027a475eadd57019d4e6872c396d0716c4875a5f1a6fcfdf385c1f:0:1"],
+    "output_cmp": "txcreatedata_seq1.hex"
   }
 ]
diff --git a/src/test/data/txcreatedata_seq0.hex b/src/test/data/txcreatedata_seq0.hex
new file mode 100644
index 000000000..db02b5e4a
--- /dev/null
+++ b/src/test/data/txcreatedata_seq0.hex
@@ -0,0 +1 @@
+01000000011f5c38dfcf6f1a5f5a87c416076d392c87e6d41970d5ad5e477a02d66bde97580000000000fdffffff0180a81201000000001976a9141fc11f39be1729bf973a7ab6a615ca4729d6457488ac00000000
diff --git a/src/test/data/txcreatedata_seq1.hex b/src/test/data/txcreatedata_seq1.hex
new file mode 100644
index 000000000..4cedcd975
--- /dev/null
+++ b/src/test/data/txcreatedata_seq1.hex
@@ -0,0 +1 @@
+01000000021f5c38dfcf6f1a5f5a87c416076d392c87e6d41970d5ad5e477a02d66bde97580000000000fdffffff1f5c38dfcf6f1a5f5a87c416076d392c87e6d41970d5ad5e477a02d66bde97580000000000010000000180a81201000000001976a9141fc11f39be1729bf973a7ab6a615ca4729d6457488ac00000000