diff --git a/meta-openembedded/meta-oe/recipes-graphics/xorg-app/xterm_353.bb b/meta-openembedded/meta-oe/recipes-graphics/xorg-app/xterm_362.bb
similarity index 63%
rename from meta-openembedded/meta-oe/recipes-graphics/xorg-app/xterm_353.bb
rename to meta-openembedded/meta-oe/recipes-graphics/xorg-app/xterm_362.bb
index 6de704d..2bbcd92 100644
--- a/meta-openembedded/meta-oe/recipes-graphics/xorg-app/xterm_353.bb
+++ b/meta-openembedded/meta-oe/recipes-graphics/xorg-app/xterm_362.bb
@@ -1,6 +1,6 @@
 require recipes-graphics/xorg-app/xorg-app-common.inc
 SUMMARY = "xterm is the standard terminal emulator for the X Window System"
-DEPENDS = "libxaw xorgproto libxext libxau libxinerama libxpm ncurses"
+DEPENDS = "libxaw xorgproto libxext libxau libxinerama libxpm ncurses desktop-file-utils-native"
 
 LIC_FILES_CHKSUM = "file://xterm.h;beginline=3;endline=31;md5=996b1ce0584c0747b17b57654cc81e8e"
 
@@ -8,11 +8,14 @@
            file://0001-Add-configure-time-check-for-setsid.patch \
           "
 
-SRC_URI[md5sum] = "247c30ebfa44623f3a2d100e0cae5c7f"
-SRC_URI[sha256sum] = "e521d3ee9def61f5d5c911afc74dd5c3a56ce147c7071c74023ea24cac9bb768"
+SRC_URI[md5sum] = "ee6710bbbe18000236c6e6d7b55b54d5"
+SRC_URI[sha256sum] = "1d4ffe226fa8f021859bbc3007788ff63a46a31242d9bd9a7bd7ebe24e81aca2"
 PACKAGECONFIG ?= ""
 PACKAGECONFIG[xft] = "--enable-freetype,--disable-freetype,libxft fontconfig freetype-native"
 
+# Let xterm install .desktop files
+inherit mime-xdg
+
 EXTRA_OECONF = " --x-includes=${STAGING_INCDIR} \
                  --x-libraries=${STAGING_LIBDIR} \
                  FREETYPE_CONFIG=${STAGING_BINDIR_CROSS}/freetype-config \
@@ -30,7 +33,16 @@
     oe_runconf
 }
 
+do_install_append() {
+    oe_runmake install-desktop DESTDIR="${D}" DESKTOP_FLAGS="--dir=${D}${DESKTOPDIR}"
+}
+
+RPROVIDES_${PN} = "virtual/x-terminal-emulator"
+
 # busybox can supply resize too
 inherit update-alternatives
 
-ALTERNATIVE_${PN} = "resize"
+ALTERNATIVE_${PN} = "resize x-terminal-emulator"
+ALTERNATIVE_TARGET[x-terminal-emulator] = "${bindir}/xterm"
+# rxvt-unicode defaults to priority 10. Let's be one point lower to let it override xterm.
+ALTERNATIVE_PRIORITY[x-terminal-emulator] = "9"