diff --git a/modules/installer/grub/grub-menu-builder.sh b/modules/installer/grub/grub-menu-builder.sh
index f64aa837eb56..9db2bbfa41ca 100644
--- a/modules/installer/grub/grub-menu-builder.sh
+++ b/modules/installer/grub/grub-menu-builder.sh
@@ -5,36 +5,87 @@ shopt -s nullglob
 export PATH=/empty
 for i in @path@; do PATH=$PATH:$i/bin; done
 
-default=$1
-if test -z "$1"; then
-    echo "Syntax: grub-menu-builder.sh <DEFAULT-CONFIG>"
+if test $# -ne 1; then
+    echo "Usage: grub-menu-builder.sh DEFAULT-CONFIG"
     exit 1
 fi
 
+grubVersion="@version@"
+defaultConfig="$1"
 bootDevice="@bootDevice@"
 if test -z "$bootDevice"; then bootDevice=/boot; fi
 
-
-echo "updating the GRUB menu..."
+case "$grubVersion" in
+    1|2)
+	echo "updating GRUB $grubVersion menu..."
+	;;
+    *)
+	echo "Unsupported GRUB version \`$grubVersion'" >&2
+	echo "Supported versions are \`1' (GRUB Legacy) and \`2' (GRUB 1.9x)." >&2
+	exit 1
+	;;
+esac
 
 
-target=/boot/grub/menu.lst
-tmp=$target.tmp
+prologue() {
+    if test -n "@splashImage@"; then
+	splashLocation="@splashImage@"
+	if test "$grubVersion" -eq 1 ; then
+    	    # Splash images in /nix/store don't seem to work, so copy them.
+	    cp -f $splashLocation /boot/background.xpm.gz
+	    splashLocation="$bootDevice/background.xpm.gz"
+	fi
+    fi
 
-cat > $tmp << GRUBEND
+    case "$grubVersion" in
+	1)
+	    cat > "$1" << GRUBEND
 # Automatically generated.  DO NOT EDIT THIS FILE!
 default 0
 timeout 5
 GRUBEND
-
-
-if test -n "@splashImage@"; then
-    splashLocation=@splashImage@
-    # Splash images in /nix/store don't seem to work, so copy them.
-    cp -f $splashLocation /boot/background.xpm.gz
-    splashLocation="$bootDevice/background.xpm.gz"
-    echo "splashimage $splashLocation" >> $tmp
+	    if test -n "@splashImage@"; then
+		echo "splashimage $splashLocation" >> "$1"
+	    fi
+	    ;;
+	2)
+	    cat > "$1" <<EOF
+# Automatically generated.  DO NOT EDIT THIS FILE!
+set default=0
+set timeout=5
+if loadfont @grub@/share/grub/unicode.pf2 ; then
+  set gfxmode=640x480
+  insmod gfxterm
+  insmod vbe
+  terminal_output gfxterm
 fi
+EOF
+	    if test -n "@splashImage@"; then
+		# FIXME: GRUB 1.97 doesn't resize the background image
+		# if it doesn't match the video resolution.
+		cat >> "$1" <<EOF
+insmod png
+if background_image $splashLocation ; then
+  set color_normal=black/black
+  set color_highlight=magenta/black
+else
+  set menu_color_normal=cyan/blue
+  set menu_color_highlight=white/blue
+fi
+EOF
+	    fi
+	    ;;
+    esac
+}
+
+case "$grubVersion" in
+    1) target="/boot/grub/menu.lst";;
+    2) target="/boot/grub/grub.cfg";;
+esac
+
+tmp="$target.tmp"
+
+prologue "$tmp"
 
 
 configurationCounter=0
@@ -94,15 +145,27 @@ addEntry() {
     local kernel=$(readlink -f $path/kernel)
     local initrd=$(readlink -f $path/initrd)
 
-    if test "$path" = "$default"; then
+    if test "$path" = "$defaultConfig"; then
 	cp "$kernel" /boot/nixos-kernel
 	cp "$initrd" /boot/nixos-initrd
 	cp "$(readlink -f "$path/init")" /boot/nixos-init
-	cat > /boot/nixos-grub-config <<EOF
+	case "$grubVersion" in
+	    1)
+		cat > /boot/nixos-grub-config <<EOF
 	title Emergency boot
 	kernel ${bootDevice:-/boot}/nixos-kernel systemConfig=$(readlink -f "$path") init=/boot/nixos-init $(cat "$path/kernel-params")
 	initrd ${bootDevice:-/boot}/nixos-initrd
 EOF
+		;;
+	    2)
+		cat > /boot/nixos-grub-config <<EOF
+        menuentry "Emergency boot" {
+          linux  ${bootDevice:-/boot}/nixos-kernel systemConfig=$(readlink -f "$path") init=/boot/nixos-init $(cat "$path/kernel-params")
+          initrd ${bootDevice:-/boot}/initrd
+        }
+EOF
+		;;
+	esac
     fi
 
     if test -n "@copyKernels@"; then
@@ -122,12 +185,23 @@ EOF
 	name="$confName $3"
     fi
 
-    cat >> $tmp << GRUBEND
-
+    case "$grubVersion" in
+	1)
+	    cat >> "$tmp" << GRUBEND
 title $name
   kernel $kernel systemConfig=$(readlink -f $path) init=$(readlink -f $path/init) $(cat $path/kernel-params)
   initrd $initrd
 GRUBEND
+	    ;;
+	2)
+	    cat >> "$tmp" << GRUBEND
+menuentry "$name" {
+  linux  $kernel systemConfig=$(readlink -f $path) init=$(readlink -f $path/init) $(cat $path/kernel-params)
+  initrd $initrd
+}
+GRUBEND
+	    ;;
+    esac
 }
 
 
@@ -146,7 +220,7 @@ if test -n "@extraEntriesBeforeNixOS@"; then
     echo "$extraEntries" >> $tmp
 fi
 
-addEntry "NixOS - Default" $default ""
+addEntry "NixOS - Default" $defaultConfig ""
 
 if test -z "@extraEntriesBeforeNixOS@"; then 
     echo "$extraEntries" >> $tmp
@@ -154,7 +228,7 @@ fi
 
 # Add all generations of the system profile to the menu, in reverse
 # (most recent to least recent) order.
-for link in $((ls -d $default/fine-tune/* ) | sort -n); do
+for link in $((ls -d $defaultConfig/fine-tune/* ) | sort -n); do
     date=$(stat --printf="%y\n" $link | sed 's/\..*//')
     addEntry "NixOS - variation" $link ""
 done
diff --git a/modules/installer/grub/grub.nix b/modules/installer/grub/grub.nix
index afeb947a2630..4394219a319f 100644
--- a/modules/installer/grub/grub.nix
+++ b/modules/installer/grub/grub.nix
@@ -7,10 +7,13 @@ let
   grubMenuBuilder = pkgs.substituteAll {
     src = ./grub-menu-builder.sh;
     isExecutable = true;
+    grub = if config.boot.loader.grub.version == 1
+           then pkgs.grub
+           else pkgs.grub2;
     inherit (pkgs) bash;
     path = [pkgs.coreutils pkgs.gnused pkgs.gnugrep];
     inherit (config.boot.loader.grub) copyKernels extraEntries extraEntriesBeforeNixOS
-      splashImage bootDevice configurationLimit;
+      splashImage bootDevice configurationLimit version;
   };
   
 in
@@ -30,6 +33,15 @@ in
         '';
       };
 
+      version = mkOption {
+        default = 1;
+        example = 2;
+        description = ''
+          The version of GRUB to use: <literal>1</literal> for GRUB Legacy
+          (versions 0.9x), or <literal>2</literal> for GRUB 2.
+        '';
+      };
+
       device = mkOption {
         default = "";
         example = "/dev/hda";
@@ -78,10 +90,17 @@ in
       };
 
       splashImage = mkOption {
-        default = pkgs.fetchurl {
-          url = http://www.gnome-look.org/CONTENT/content-files/36909-soft-tux.xpm.gz;
-          sha256 = "14kqdx2lfqvh40h6fjjzqgff1mwk74dmbjvmqphi6azzra7z8d59";
-        };
+        default =
+          if config.boot.loader.grub.version == 1
+          then pkgs.fetchurl {
+            url = http://www.gnome-look.org/CONTENT/content-files/36909-soft-tux.xpm.gz;
+            sha256 = "14kqdx2lfqvh40h6fjjzqgff1mwk74dmbjvmqphi6azzra7z8d59";
+          }
+          # GRUB 1.97 doesn't support gzipped XPMs.
+          else pkgs.fetchurl {
+            url = http://www.gnu.org/graphics/winkler-gnu-blue.png;
+            sha256 = "0y8fvxalwxyid4k438k7c21bnv728qjsb92rqfapsmpv2bcj7f6k";
+          };
         example = null;
         description = "
           Background image used for Grub.  It must be a 640x480,
@@ -124,9 +143,16 @@ in
     # set at once.
     system.boot.loader.id = "grub";
     system.boot.loader.kernelFile = "vmlinuz";
-    
-    environment.systemPackages = mkIf config.boot.loader.grub.enable [ pkgs.grub ];
-    
+
+    environment.systemPackages =
+      mkIf config.boot.loader.grub.enable
+           (let version = config.boot.loader.grub.version; in
+              assert version != 1 -> version == 2;
+
+              if version == 1
+              then [ pkgs.grub ]
+              else [ pkgs.grub2 ]);
+
     # and many other things that have to be moved inside this file.
     
   };
diff --git a/modules/system/activation/switch-to-configuration.sh b/modules/system/activation/switch-to-configuration.sh
index 957bc124d7a6..802b57a31af0 100644
--- a/modules/system/activation/switch-to-configuration.sh
+++ b/modules/system/activation/switch-to-configuration.sh
@@ -27,6 +27,7 @@ if test "$action" = "switch" -o "$action" = "boot"; then
           mkdir -m 0700 -p /boot/grub
           @menuBuilder@ @out@
           if test "$NIXOS_INSTALL_GRUB" = 1; then
+	      echo "running \`@grub@/sbin/grub-install'..."
               @grub@/sbin/grub-install "@grubDevice@" --no-floppy --recheck
           fi
       else
diff --git a/modules/system/activation/top-level.nix b/modules/system/activation/top-level.nix
index 9fea447164b4..609b11dd3d6d 100644
--- a/modules/system/activation/top-level.nix
+++ b/modules/system/activation/top-level.nix
@@ -110,7 +110,12 @@ let
 
     # Boot loaders
     bootLoader = config.system.boot.loader.id;
-    grub = if config.boot.loader.grub.enable then pkgs.grub else null;
+    grub =
+      if config.boot.loader.grub.enable
+      then (if config.boot.loader.grub.version == 1
+            then pkgs.grub
+            else pkgs.grub2)
+      else null;
     grubDevice = config.boot.loader.grub.device;
     configurationName = config.boot.loader.grub.configurationName;
   };