diff --git a/NEWS b/NEWS
index add082b..9a8d2e1 100644
--- a/NEWS
+++ b/NEWS
@@ -2,6 +2,10 @@ GNU diffutils NEWS                                    -*- outline -*-
 
 * Noteworthy changes in release ?.? (????-??-??) [?]
 
+** Bug fixes
+
+  diff --color no longer colorizes when TERM=dumb
+
 
 * Noteworthy changes in release 3.4 (2016-08-08) [stable]
 
diff --git a/src/diff.c b/src/diff.c
index 9bc1d96..686945e 100644
--- a/src/diff.c
+++ b/src/diff.c
@@ -656,6 +656,13 @@ main (int argc, char **argv)
       prev = c;
     }
 
+  if (colors_style == AUTO)
+    {
+      char const *t = getenv ("TERM");
+      if (t && STREQ (t, "dumb"))
+        colors_style = NEVER;
+    }
+
   if (output_style == OUTPUT_UNSPECIFIED)
     {
       if (show_c_function)
diff --git a/tests/colors b/tests/colors
index 3ad2206..8651a5b 100755
--- a/tests/colors
+++ b/tests/colors
@@ -86,6 +86,11 @@ test $? = 1 || fail=1
 gen_exp_default > exp || framework_failure_
 compare exp out || fail=1
 
+TERM=dumb diff ---presume-output-tty --color=auto a b > out
+test $? = 1 || fail=1
+gen_exp_default > exp || framework_failure_
+compare exp out || fail=1
+
 diff --color=never a b > out
 test $? = 1 || fail=1
 gen_exp_default > exp || framework_failure_