diff --git a/Changelog.md b/Changelog.md
index 3d558b969..77376c5d0 100644
--- a/Changelog.md
+++ b/Changelog.md
@@ -19,6 +19,7 @@
 * Fix Facebox icons 404s when called from Backbone
 * Fix deleting a post from Facebook [#4290](https://github.com/diaspora/diaspora/pull/4290)
 * Display notices a little bit longer to help on sign up errors [#4274](https://github.com/diaspora/diaspora/issues/4274)
+* Fix user contact sharing/receiving [#4163](https://github.com/diaspora/diaspora/issues/4163)
 
 ## Features
 * Admin: add option to find users under 13 (COPPA) [#4252](https://github.com/diaspora/diaspora/pull/4252)
@@ -32,7 +33,7 @@
 
 ## Refactor
 
-* Refactored config/ directory [#4145](https://github.com/diaspora/diaspora/pull/4145).
+* Refactored config/ directory [#4144](https://github.com/diaspora/diaspora/pull/4145).
 * Drop misleading fallback donation form. [Proposal](https://www.loomio.org/discussions/1045?proposal=2722)
 * Update Typhoeus to 0.6.3 and refactor HydraWrapper. [#4162](https://github.com/diaspora/diaspora/pull/4162)
 * Bump recomended Ruby version to 1.9.3-p448, see [Ruby news](http://www.ruby-lang.org/en/news/2013/06/27/hostname-check-bypassing-vulnerability-in-openssl-client-cve-2013-4073/).
diff --git a/app/models/user/connecting.rb b/app/models/user/connecting.rb
index 94e2698f7..e90133330 100644
--- a/app/models/user/connecting.rb
+++ b/app/models/user/connecting.rb
@@ -41,11 +41,13 @@ module User::Connecting
     nil
   end
 
-  def remove_contact(contact, opts={:force => false})
+  def remove_contact(contact, opts={:force => false, :retracted => false})
     posts = contact.posts.all
 
     if !contact.mutual? || opts[:force]
       contact.destroy
+    elsif opts[:retracted]
+      contact.update_attributes(:sharing => false)
     else
       contact.update_attributes(:receiving => false)
     end
@@ -65,7 +67,7 @@ module User::Connecting
   def disconnected_by(person)
     Rails.logger.info("event=disconnected_by user=#{diaspora_handle} target=#{person.diaspora_handle}")
     if contact = self.contact_for(person)
-      remove_contact(contact)
+      remove_contact(contact, :retracted => true)
     end
   end
 end
diff --git a/spec/models/user/connecting_spec.rb b/spec/models/user/connecting_spec.rb
index ad063674f..6f8250d2f 100644
--- a/spec/models/user/connecting_spec.rb
+++ b/spec/models/user/connecting_spec.rb
@@ -36,10 +36,16 @@ describe User::Connecting do
 
     describe '#disconnected_by' do
       it 'calls remove contact' do
-        bob.should_receive(:remove_contact).with(bob.contact_for(alice.person))
+        bob.should_receive(:remove_contact).with(bob.contact_for(alice.person), :retracted => true)
         bob.disconnected_by(alice.person)
       end
 
+      it 'removes contact sharing flag' do
+        bob.contacts.find_by_person_id(alice.person.id).should be_sharing
+        bob.disconnected_by(alice.person)
+        bob.contacts.find_by_person_id(alice.person.id).should_not be_sharing
+      end
+
       it 'removes notitications' do
         alice.share_with(eve.person, alice.aspects.first)
         Notifications::StartedSharing.where(:recipient_id => eve.id).first.should_not be_nil