diff --git a/xbmc/addons/AddonInstaller.cpp b/xbmc/addons/AddonInstaller.cpp
index 5c67125ed1a73..45f9af9511bd6 100644
--- a/xbmc/addons/AddonInstaller.cpp
+++ b/xbmc/addons/AddonInstaller.cpp
@@ -21,10 +21,12 @@
 #include "AddonInstaller.h"
 #include "Service.h"
 #include "utils/log.h"
+#include "utils/FileUtils.h"
 #include "utils/URIUtils.h"
 #include "Util.h"
 #include "guilib/LocalizeStrings.h"
 #include "filesystem/Directory.h"
+#include "settings/AdvancedSettings.h"
 #include "settings/GUISettings.h"
 #include "settings/Settings.h"
 #include "ApplicationMessenger.h"
@@ -84,6 +86,7 @@ void CAddonInstaller::OnJobComplete(unsigned int jobID, bool success, CJob* job)
     JobMap::iterator i = find_if(m_downloadJobs.begin(), m_downloadJobs.end(), bind2nd(find_map(), jobID));
     if (i != m_downloadJobs.end())
       m_downloadJobs.erase(i);
+    PrunePackageCache();
   }
   lock.Leave();
 
@@ -381,6 +384,75 @@ bool CAddonInstaller::HasJob(const CStdString& ID) const
   return m_downloadJobs.find(ID) != m_downloadJobs.end();
 }
 
+void CAddonInstaller::PrunePackageCache()
+{
+  std::map<CStdString,CFileItemList*> packs;
+  int64_t size = EnumeratePackageFolder(packs);
+  if (size < g_advancedSettings.m_addonPackageFolderSize)
+    return;
+
+  // Prune packages
+  // 1. Remove the largest packages, leaving at least 2 for each add-on
+  CFileItemList items;
+  for (std::map<CStdString,CFileItemList*>::const_iterator it  = packs.begin();
+                                                          it != packs.end();++it)
+  {
+    it->second->Sort(SORT_METHOD_LABEL,SortOrderDescending);
+    for (int j=2;j<it->second->Size();++j)
+      items.Add(CFileItemPtr(new CFileItem(*it->second->Get(j))));
+  }
+  items.Sort(SORT_METHOD_SIZE,SortOrderDescending);
+  int i=0;
+  while (size > g_advancedSettings.m_addonPackageFolderSize && i < items.Size())
+  {
+    size -= items[i]->m_dwSize;
+    CFileUtils::DeleteItem(items[i++],true);
+  }
+
+  if (size > g_advancedSettings.m_addonPackageFolderSize)
+  {
+    // 2. Remove the oldest packages (leaving least 1 for each add-on)
+    items.Clear();
+    for (std::map<CStdString,CFileItemList*>::iterator it  = packs.begin();
+                                                       it != packs.end();++it)
+    {
+      if (it->second->Size() > 1)
+        items.Add(CFileItemPtr(new CFileItem(*it->second->Get(1))));
+    }
+    items.Sort(SORT_METHOD_DATE,SortOrderAscending);
+    i=0;
+    while (size > g_advancedSettings.m_addonPackageFolderSize && i < items.Size())
+    {
+      size -= items[i]->m_dwSize;
+      CFileUtils::DeleteItem(items[i++],true);
+    }
+  }
+  // clean up our mess
+  for (std::map<CStdString,CFileItemList*>::iterator it  = packs.begin();
+                                                     it != packs.end();++it)
+    delete it->second;
+}
+
+int64_t CAddonInstaller::EnumeratePackageFolder(std::map<CStdString,CFileItemList*>& result)
+{
+  CFileItemList items;
+  CDirectory::GetDirectory("special://home/addons/packages/",items,".zip",DIR_FLAG_NO_FILE_DIRS);
+  int64_t size=0;
+  for (int i=0;i<items.Size();++i)
+  {
+    if (items[i]->m_bIsFolder)
+      continue;
+    size += items[i]->m_dwSize;
+    CStdString pack,dummy;
+    AddonVersion::SplitFileName(pack,dummy,items[i]->GetLabel());
+    if (result.find(pack) == result.end())
+      result[pack] = new CFileItemList;
+    result[pack]->Add(CFileItemPtr(new CFileItem(*items[i])));
+  }
+
+  return size;
+}
+
 CAddonInstallJob::CAddonInstallJob(const AddonPtr &addon, const CStdString &hash, bool update, const CStdString &referer)
 : m_addon(addon), m_hash(hash), m_update(update), m_referer(referer)
 {
diff --git a/xbmc/addons/AddonInstaller.h b/xbmc/addons/AddonInstaller.h
index f335ebfa64ed7..c68a6533a1adc 100644
--- a/xbmc/addons/AddonInstaller.h
+++ b/xbmc/addons/AddonInstaller.h
@@ -122,6 +122,9 @@ class CAddonInstaller : public IJobCallback
    */
   bool DoInstall(const ADDON::AddonPtr &addon, const CStdString &hash = "", bool update = false, const CStdString &referer = "", bool background = true);
 
+  void PrunePackageCache();
+  int64_t EnumeratePackageFolder(std::map<CStdString,CFileItemList*>& result);
+
   CCriticalSection m_critSection;
   JobMap m_downloadJobs;
   CStopWatch m_repoUpdateWatch;   ///< repository updates are done based on this counter
diff --git a/xbmc/settings/AdvancedSettings.cpp b/xbmc/settings/AdvancedSettings.cpp
index bcb5953534168..3c6912b4aad96 100644
--- a/xbmc/settings/AdvancedSettings.cpp
+++ b/xbmc/settings/AdvancedSettings.cpp
@@ -298,6 +298,7 @@ void CAdvancedSettings::Initialize()
   m_measureRefreshrate = false;
 
   m_cacheMemBufferSize = 1024 * 1024 * 20;
+  m_addonPackageFolderSize = 200*1024*1024;
 
   m_jsonOutputCompact = true;
   m_jsonTcpPort = 9090;
@@ -759,6 +760,7 @@ void CAdvancedSettings::ParseSettingsFile(const CStdString &file)
   XMLUtils::GetUInt(pRootElement,"restrictcapsmask", m_RestrictCapsMask);
   XMLUtils::GetFloat(pRootElement,"sleepbeforeflip", m_sleepBeforeFlip, 0.0f, 1.0f);
   XMLUtils::GetBoolean(pRootElement,"virtualshares", m_bVirtualShares);
+  XMLUtils::GetUInt(pRootElement, "packagefoldersize", m_addonPackageFolderSize);
 
   //Tuxbox
   pElement = pRootElement->FirstChildElement("tuxbox");
diff --git a/xbmc/settings/AdvancedSettings.h b/xbmc/settings/AdvancedSettings.h
index 36e02f49cbdf8..4befa28d3bb40 100644
--- a/xbmc/settings/AdvancedSettings.h
+++ b/xbmc/settings/AdvancedSettings.h
@@ -346,6 +346,7 @@ class CAdvancedSettings
     bool m_guiVisualizeDirtyRegions;
     int  m_guiAlgorithmDirtyRegions;
     int  m_guiDirtyRegionNoFlipTimeout;
+    unsigned int m_addonPackageFolderSize;
 
     unsigned int m_cacheMemBufferSize;