diff --git a/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffPanel.form b/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffPanel.form
index dde268b4b3e9..5fe7a42a6536 100644
--- a/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffPanel.form
+++ b/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffPanel.form
@@ -22,13 +22,12 @@
             <border type="none"/>
             <children/>
           </grid>
-          <scrollpane id="90582" class="com.intellij.ui.components.JBScrollPane">
+          <scrollpane id="90582" class="com.intellij.ui.components.JBScrollPane" binding="myScrollPane">
             <constraints>
               <splitpane position="left"/>
             </constraints>
             <properties>
-              <minimumSize width="456" height="200"/>
-              <preferredSize width="456" height="200"/>
+              <minimumSize width="21" height="200"/>
             </properties>
             <border type="none"/>
             <children>
@@ -36,8 +35,6 @@
                 <constraints/>
                 <properties>
                   <intercellSpacing width="0" height="0"/>
-                  <minimumSize width="30" height="32"/>
-                  <preferredSize width="150" height="32"/>
                   <showHorizontalLines value="false"/>
                   <showVerticalLines value="false"/>
                 </properties>
diff --git a/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffPanel.java b/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffPanel.java
index 8849338c9002..c0598d1a1de2 100644
--- a/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffPanel.java
+++ b/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffPanel.java
@@ -23,8 +23,8 @@ import com.intellij.openapi.diff.impl.dir.actions.DirDiffToolbarActions;
 import com.intellij.openapi.project.Project;
 import com.intellij.openapi.ui.TextFieldWithBrowseButton;
 import com.intellij.ui.components.JBLabel;
+import com.intellij.ui.components.JBScrollPane;
 import com.intellij.ui.table.JBTable;
-import com.intellij.util.Icons;
 
 import javax.swing.*;
 import javax.swing.event.ListSelectionEvent;
@@ -51,6 +51,7 @@ public class DirDiffPanel {
   private JPanel myActionsCenterPanel;
   private JComboBox myFileFilter;
   private JPanel myToolBarPanel;
+  private JBScrollPane myScrollPane;
   private final DirDiffTableModel myModel;
   public JLabel myErrorLabel;
   private final DirDiffDialog myDialog;
@@ -59,12 +60,13 @@ public class DirDiffPanel {
   private DiffElement myCurrentElement;
 
   public DirDiffPanel(DirDiffTableModel model, DirDiffDialog dirDiffDialog, DirDiffSettings settings) {
+    mySplitPanel.setDividerLocation(0.5);
     myModel = model;
     myDialog = dirDiffDialog;
     mySourceDirField.setText(model.getSourceDir().getPath());
     myTargetDirField.setText(model.getTargetDir().getPath());
-    mySourceDirLabel.setIcon(Icons.FOLDER_ICON);
-    myTargetDirLabel.setIcon(Icons.FOLDER_ICON);
+    mySourceDirLabel.setIcon(model.getSourceDir().getIcon());
+    myTargetDirLabel.setIcon(model.getTargetDir().getIcon());
     myTable.setModel(myModel);
     final DirDiffTableCellRenderer renderer = new DirDiffTableCellRenderer(myTable);
     myTable.setDefaultRenderer(Object.class, renderer);
@@ -165,9 +167,6 @@ public class DirDiffPanel {
     myDiffPanel.remove(getErrorLabel());
   }
 
-  private void createUIComponents() {
-  }
-
   public JComponent getPanel() {
     return myComponent;
   }
diff --git a/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffTableCellRenderer.java b/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffTableCellRenderer.java
index 7eea4fc10f16..904bc326a145 100644
--- a/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffTableCellRenderer.java
+++ b/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffTableCellRenderer.java
@@ -18,7 +18,6 @@ package com.intellij.openapi.diff.impl.dir;
 import com.intellij.openapi.vcs.FileStatus;
 import com.intellij.ui.table.JBTable;
 import com.intellij.util.IconUtil;
-import com.intellij.util.Icons;
 import com.intellij.util.containers.HashMap;
 import com.intellij.util.ui.UIUtil;
 
@@ -65,7 +64,7 @@ public class DirDiffTableCellRenderer extends DefaultTableCellRenderer {
           }
           int width = columnModel.getColumn(column).getWidth();
           int height = table.getRowHeight(row);
-          final BufferedImage image = getOrCreate(element.getName());
+          final BufferedImage image = getOrCreate(element.getName(), element.getIcon());
           g.drawImage(image, 0, 0, width, height, offset, 0, offset + width, height, null);
         }
       };
@@ -92,7 +91,6 @@ public class DirDiffTableCellRenderer extends DefaultTableCellRenderer {
         label.setHorizontalAlignment(CENTER);
       } else if (DirDiffTableModel.COLUMN_SIZE.equals(name)) {
         label.setHorizontalAlignment(RIGHT);
-        label.setText(label.getText() + "  ");
       } else {
         label.setHorizontalAlignment(LEFT);
         final String text = label.getText();
@@ -110,7 +108,7 @@ public class DirDiffTableCellRenderer extends DefaultTableCellRenderer {
            ? FileStatus.COLOR_ADDED : FileStatus.COLOR_MODIFIED;
   }
 
-  private BufferedImage getOrCreate(String path) {
+  private BufferedImage getOrCreate(String path, Icon icon) {
     final BufferedImage image = cache.get(path);
     if (image != null) {
       return image;
@@ -118,11 +116,12 @@ public class DirDiffTableCellRenderer extends DefaultTableCellRenderer {
     final int w = myTable.getWidth();
     final int h = myTable.getRowHeight();
     final BufferedImage img = new BufferedImage(w, h, BufferedImage.TYPE_INT_ARGB);
-    final Icon icon = Icons.FOLDER_ICON;
     final Graphics g = img.getGraphics();
-    g.drawImage(IconUtil.toImage(icon), 2, (h - icon.getIconHeight()) / 2, null);
+    if (icon != null) {
+      g.drawImage(IconUtil.toImage(icon), 2, (h - icon.getIconHeight()) / 2, null);
+    }
     g.setColor(Color.BLACK);
-    g.drawString(path, 2 + icon.getIconWidth() + 2, h - 2);
+    g.drawString(path, 2 + (icon == null ? 0 : icon.getIconWidth()) + 2, h - 2);
     cache.put(path, img);
     return img;
   }
diff --git a/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffTableModel.java b/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffTableModel.java
index 5c9cebd83e93..bd85826e5af5 100644
--- a/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffTableModel.java
+++ b/platform/vcs-impl/src/com/intellij/openapi/diff/impl/dir/DirDiffTableModel.java
@@ -87,9 +87,9 @@ public class DirDiffTableModel extends AbstractTableModel {
       final DiffElement srcFile = mySrcPaths.get(path);
       final DiffElement trgFile = myTrgPaths.get(path);
       if (srcFile == null && trgFile != null) {
-        myElements.add(DirDiffElement.createTargetOnly(trgFile));
+        myElements.add(trgFile.isContainer() ? DirDiffElement.createDirElement(srcFile, trgFile, path) : DirDiffElement.createTargetOnly(trgFile));
       } else if (srcFile != null && trgFile == null) {
-        myElements.add(DirDiffElement.createSourceOnly(srcFile));
+        myElements.add(srcFile.isContainer() ? DirDiffElement.createDirElement(srcFile, trgFile, path) : DirDiffElement.createSourceOnly(srcFile));
       } else if (srcFile != null && trgFile != null) {
         indicator.setText2("Comparing " + path);
         if (srcFile.isContainer() && trgFile.isContainer()) {
@@ -117,15 +117,15 @@ public class DirDiffTableModel extends AbstractTableModel {
     boolean prevItemIsSeparator = true;
     for (int i = tmp.length - 1; i >= 0; i--) {
       final boolean isSeparator = tmp[i].isSeparator();
-      if (isSeparator) {
-        if (prevItemIsSeparator) {
-          elements.remove(i);
+        if (isSeparator) {
+          if (prevItemIsSeparator) {
+            elements.remove(i);
+          }
+          prevItemIsSeparator = true;
+        } else {
+          prevItemIsSeparator = false;
         }
-        prevItemIsSeparator = true;
-      } else {
-        prevItemIsSeparator = false;
       }
-    }
   }
 
   private static boolean isEqual(DiffElement file1, DiffElement file2) {