diff -r 7d667b53ca2c sdl.c
--- a/sdl.c	Wed Mar  1 12:44:52 2006 -0500
+++ b/sdl.c	Wed Mar  1 13:17:26 2006 -0500
@@ -39,6 +39,8 @@
 static int gui_fullscreen_initial_grab;
 static int gui_grab_code = KMOD_LALT | KMOD_LCTRL;
 static uint8_t modifiers_state[256];
+static SDL_Cursor *sdl_cursor_normal;
+static SDL_Cursor *sdl_cursor_hidden;
 
 static void sdl_update(DisplayState *ds, int x, int y, int w, int h)
 {
@@ -273,7 +275,8 @@
 
 static void sdl_grab_start(void)
 {
-    SDL_ShowCursor(0);
+    sdl_cursor_normal = SDL_GetCursor();
+    SDL_SetCursor(sdl_cursor_hidden);
     SDL_WM_GrabInput(SDL_GRAB_ON);
     /* dummy read to avoid moving the mouse */
     SDL_GetRelativeMouseState(NULL, NULL);
@@ -284,7 +287,7 @@
 static void sdl_grab_end(void)
 {
     SDL_WM_GrabInput(SDL_GRAB_OFF);
-    SDL_ShowCursor(1);
+    SDL_SetCursor(sdl_cursor_normal);
     gui_grab = 0;
     sdl_update_caption();
 }
@@ -475,6 +478,7 @@
 void sdl_display_init(DisplayState *ds, int full_screen)
 {
     int flags;
+    uint8_t data = 0;
 
 #if defined(__APPLE__)
     /* always use generic keymaps */
@@ -508,6 +512,12 @@
     SDL_EnableUNICODE(1);
     gui_grab = 0;
 
+    /* work around a bug in libsdl that causes mouse position to be reported
+       relative to the upper left corner of the screen instead of the window
+       after SDL_ShowCursor(0) by using a custom invisible cursor.
+    */
+    sdl_cursor_hidden = SDL_CreateCursor(&data, &data, 8, 1, 0, 0);
+
     atexit(sdl_cleanup);
     if (full_screen) {
         gui_fullscreen = 1;