diff --git a/src/compositor-drm.c b/src/compositor-drm.c
index cfaad15d..d2a5652b 100644
--- a/src/compositor-drm.c
+++ b/src/compositor-drm.c
@@ -214,7 +214,8 @@ drm_output_prepare_scanout_surface(struct drm_output *output)
 }
 
 static void
-drm_output_repaint(struct weston_output *output_base)
+drm_output_repaint(struct weston_output *output_base,
+		   pixman_region32_t *damage)
 {
 	struct drm_output *output = (struct drm_output *) output_base;
 	struct drm_compositor *compositor =
@@ -235,7 +236,7 @@ drm_output_repaint(struct weston_output *output_base)
 	drm_output_prepare_scanout_surface(output);
 
 	wl_list_for_each_reverse(surface, &compositor->base.surface_list, link)
-		weston_surface_draw(surface, &output->base);
+		weston_surface_draw(surface, &output->base, damage);
 
 	glFlush();
 
diff --git a/src/compositor-wayland.c b/src/compositor-wayland.c
index f8b5a32c..f23c357c 100644
--- a/src/compositor-wayland.c
+++ b/src/compositor-wayland.c
@@ -329,7 +329,8 @@ static const struct wl_callback_listener frame_listener = {
 };
 
 static void
-wayland_output_repaint(struct weston_output *output_base)
+wayland_output_repaint(struct weston_output *output_base,
+		       pixman_region32_t *damage)
 {
 	struct wayland_output *output = (struct wayland_output *) output_base;
 	struct wayland_compositor *compositor =
@@ -344,7 +345,7 @@ wayland_output_repaint(struct weston_output *output_base)
 	}
 
 	wl_list_for_each_reverse(surface, &compositor->base.surface_list, link)
-		weston_surface_draw(surface, &output->base);
+		weston_surface_draw(surface, &output->base, damage);
 
 	draw_border(output);
 
diff --git a/src/compositor-x11.c b/src/compositor-x11.c
index 53998d24..c227063b 100644
--- a/src/compositor-x11.c
+++ b/src/compositor-x11.c
@@ -186,7 +186,8 @@ x11_compositor_fini_egl(struct x11_compositor *compositor)
 }
 
 static void
-x11_output_repaint(struct weston_output *output_base)
+x11_output_repaint(struct weston_output *output_base,
+		   pixman_region32_t *damage)
 {
 	struct x11_output *output = (struct x11_output *)output_base;
 	struct x11_compositor *compositor =
@@ -200,7 +201,7 @@ x11_output_repaint(struct weston_output *output_base)
 	}
 
 	wl_list_for_each_reverse(surface, &compositor->base.surface_list, link)
-		weston_surface_draw(surface, &output->base);
+		weston_surface_draw(surface, &output->base, damage);
 
 	eglSwapBuffers(compositor->base.display, output->egl_surface);
 
diff --git a/src/compositor.c b/src/compositor.c
index 069ea74d..0c99a5f4 100644
--- a/src/compositor.c
+++ b/src/compositor.c
@@ -211,6 +211,7 @@ weston_surface_create(struct weston_compositor *compositor)
 	wl_list_init(&surface->surface.resource.destroy_listener_list);
 
 	wl_list_init(&surface->link);
+	wl_list_init(&surface->layer_link);
 	wl_list_init(&surface->buffer_link);
 
 	surface->surface.resource.client = NULL;
@@ -225,6 +226,7 @@ weston_surface_create(struct weston_compositor *compositor)
 
 	pixman_region32_init(&surface->damage);
 	pixman_region32_init(&surface->opaque);
+	pixman_region32_init(&surface->clip);
 	undef_region(&surface->input);
 	pixman_region32_init(&surface->transform.opaque);
 	wl_list_init(&surface->frame_callback_list);
@@ -281,17 +283,15 @@ surface_to_global_float(struct weston_surface *surface,
 WL_EXPORT void
 weston_surface_damage_below(struct weston_surface *surface)
 {
-	struct weston_surface *below;
+	struct weston_compositor *compositor = surface->compositor;
+	pixman_region32_t damage;
 
-	if (surface->output == NULL)
-		return;
-
-	if (surface->link.next == &surface->compositor->surface_list)
-		return;
-
-	below = container_of(surface->link.next, struct weston_surface, link);
-	pixman_region32_union(&below->damage, &below->damage,
-			      &surface->transform.boundingbox);
+	pixman_region32_init(&damage);
+	pixman_region32_subtract(&damage, &surface->transform.boundingbox,
+				 &surface->clip);
+	pixman_region32_union(&compositor->damage,
+			      &compositor->damage, &damage);
+	pixman_region32_fini(&damage);
 }
 
 static void
@@ -510,21 +510,6 @@ weston_surface_damage(struct weston_surface *surface)
 	weston_compositor_schedule_repaint(surface->compositor);
 }
 
-static void
-weston_surface_flush_damage(struct weston_surface *surface)
-{
-	struct weston_surface *below;
-
-	if (surface->output &&
-	    surface->link.next != &surface->compositor->surface_list) {
-		below = container_of(surface->link.next,
-				     struct weston_surface, link);
-
-		pixman_region32_union(&below->damage,
-				      &below->damage, &surface->damage);
-	}
-}
-
 WL_EXPORT void
 weston_surface_configure(struct weston_surface *surface,
 			 GLfloat x, GLfloat y, int width, int height)
@@ -613,11 +598,18 @@ weston_compositor_repick(struct weston_compositor *compositor)
 static void
 weston_surface_unmap(struct weston_surface *surface)
 {
+	struct wl_input_device *device = surface->compositor->input_device;
+
 	weston_surface_damage_below(surface);
-	weston_surface_flush_damage(surface);
 	surface->output = NULL;
 	wl_list_remove(&surface->link);
+	wl_list_remove(&surface->layer_link);
 	weston_compositor_repick(surface->compositor);
+
+	if (device->keyboard_focus == &surface->surface)
+		wl_input_device_set_keyboard_focus(device, NULL,
+						   weston_compositor_get_time());
+
 	weston_compositor_schedule_repaint(surface->compositor);
 }
 
@@ -647,6 +639,7 @@ destroy_surface(struct wl_resource *resource)
 	pixman_region32_fini(&surface->transform.boundingbox);
 	pixman_region32_fini(&surface->damage);
 	pixman_region32_fini(&surface->opaque);
+	pixman_region32_fini(&surface->clip);
 	if (!region_is_undefined(&surface->input))
 		pixman_region32_fini(&surface->input);
 
@@ -762,7 +755,8 @@ texture_region(struct weston_surface *es, pixman_region32_t *region)
 }
 
 WL_EXPORT void
-weston_surface_draw(struct weston_surface *es, struct weston_output *output)
+weston_surface_draw(struct weston_surface *es, struct weston_output *output,
+		    pixman_region32_t *damage)
 {
 	struct weston_compositor *ec = es->compositor;
 	GLfloat *v;
@@ -771,12 +765,9 @@ weston_surface_draw(struct weston_surface *es, struct weston_output *output)
 	int n;
 
 	pixman_region32_init(&repaint);
-	pixman_region32_intersect(&repaint, &es->transform.boundingbox,
-				  &output->region);
-	pixman_region32_intersect(&repaint, &repaint, &es->damage);
-
-	/* Clear damage, assume outputs do not overlap. */
-	pixman_region32_subtract(&es->damage, &es->damage, &output->region);
+	pixman_region32_intersect(&repaint,
+				  &es->transform.boundingbox, damage);
+	pixman_region32_subtract(&repaint, &repaint, &es->clip);
 
 	if (!pixman_region32_not_empty(&repaint))
 		goto out;
@@ -826,37 +817,15 @@ out:
 	pixman_region32_fini(&repaint);
 }
 
-WL_EXPORT struct wl_list *
-weston_compositor_top(struct weston_compositor *compositor)
-{
-	struct weston_input_device *input_device;
-	struct wl_list *list;
-
-	input_device = (struct weston_input_device *) compositor->input_device;
-
-	/* Insert below pointer */
-	list = &compositor->surface_list;
-	if (compositor->fade.surface &&
-	    list->next == &compositor->fade.surface->link)
-		list = list->next;
-	if (list->next == &input_device->sprite->link)
-		list = list->next;
-	if (input_device->drag_surface &&
-	    list->next == &input_device->drag_surface->link)
-		list = list->next;
-
-	return list;
-}
-
-static void
-weston_surface_raise(struct weston_surface *surface)
+WL_EXPORT void
+weston_surface_restack(struct weston_surface *surface, struct wl_list *below)
 {
 	struct weston_compositor *compositor = surface->compositor;
-	struct wl_list *list = weston_compositor_top(compositor);
 
-	wl_list_remove(&surface->link);
-	wl_list_insert(list, &surface->link);
+	wl_list_remove(&surface->layer_link);
+	wl_list_insert(below, &surface->layer_link);
 	weston_compositor_repick(compositor);
+	weston_surface_damage_below(surface);
 	weston_surface_damage(surface);
 }
 
@@ -883,14 +852,9 @@ WL_EXPORT void
 weston_output_damage(struct weston_output *output)
 {
 	struct weston_compositor *compositor = output->compositor;
-	struct weston_surface *es;
 
-	if (wl_list_empty(&compositor->surface_list))
-		return;
-
-	es = container_of(compositor->surface_list.next,
-			  struct weston_surface, link);
-	pixman_region32_union(&es->damage, &es->damage, &output->region);
+	pixman_region32_union(&compositor->damage,
+			      &compositor->damage, &output->region);
 	weston_compositor_schedule_repaint(compositor);
 }
 
@@ -935,9 +899,10 @@ weston_output_repaint(struct weston_output *output, int msecs)
 {
 	struct weston_compositor *ec = output->compositor;
 	struct weston_surface *es;
+	struct weston_layer *layer;
 	struct weston_animation *animation, *next;
 	struct weston_frame_callback *cb, *cnext;
-	pixman_region32_t opaque, new_damage, total_damage;
+	pixman_region32_t opaque, new_damage, output_damage;
 	int32_t width, height;
 
 	weston_compositor_update_drag_surfaces(ec);
@@ -948,13 +913,14 @@ weston_output_repaint(struct weston_output *output, int msecs)
 		output->border.top + output->border.bottom;
 	glViewport(0, 0, width, height);
 
-	pixman_region32_init(&new_damage);
-	pixman_region32_init(&opaque);
-
-	wl_list_for_each(es, &ec->surface_list, link)
-		/* Update surface transform now to avoid calling it ever
-		 * again from the repaint sub-functions. */
-		weston_surface_update_transform(es);
+	/* Rebuild the surface list and update surface transforms up front. */
+	wl_list_init(&ec->surface_list);
+	wl_list_for_each(layer, &ec->layer_list, link) {
+		wl_list_for_each(es, &layer->surface_list, layer_link) {
+			weston_surface_update_transform(es);
+			wl_list_insert(ec->surface_list.prev, &es->link);
+		}
+	}
 
 	if (output->assign_planes)
 		/*
@@ -965,33 +931,36 @@ weston_output_repaint(struct weston_output *output, int msecs)
 		 */
 		output->assign_planes(output);
 
+	pixman_region32_init(&new_damage);
+	pixman_region32_init(&opaque);
+
 	wl_list_for_each(es, &ec->surface_list, link) {
 		pixman_region32_subtract(&es->damage, &es->damage, &opaque);
 		pixman_region32_union(&new_damage, &new_damage, &es->damage);
+		empty_region(&es->damage);
+		pixman_region32_copy(&es->clip, &opaque);
 		pixman_region32_union(&opaque, &opaque, &es->transform.opaque);
 	}
 
-	pixman_region32_init(&total_damage);
-	pixman_region32_union(&total_damage, &new_damage,
-			      &output->previous_damage);
-	pixman_region32_intersect(&output->previous_damage,
-				  &new_damage, &output->region);
+	pixman_region32_union(&ec->damage, &ec->damage, &new_damage);
+
+	pixman_region32_init(&output_damage);
+	pixman_region32_union(&output_damage,
+			      &ec->damage, &output->previous_damage);
+	pixman_region32_copy(&output->previous_damage, &ec->damage);
+	pixman_region32_intersect(&output_damage,
+				  &output_damage, &output->region);
+	pixman_region32_subtract(&ec->damage, &ec->damage, &output->region);
 
 	pixman_region32_fini(&opaque);
 	pixman_region32_fini(&new_damage);
 
-	wl_list_for_each(es, &ec->surface_list, link) {
-		pixman_region32_copy(&es->damage, &total_damage);
-		pixman_region32_subtract(&total_damage,
-					 &total_damage, &es->transform.opaque);
-	}
-
 	if (output->dirty)
 		weston_output_update_matrix(output);
 
-	output->repaint(output);
+	output->repaint(output, &output_damage);
 
-	pixman_region32_fini(&total_damage);
+	pixman_region32_fini(&output_damage);
 
 	output->repaint_needed = 0;
 
@@ -1025,6 +994,13 @@ weston_output_finish_frame(struct weston_output *output, int msecs)
 		output->repaint_scheduled = 0;
 }
 
+WL_EXPORT void
+weston_layer_init(struct weston_layer *layer, struct wl_list *below)
+{
+	wl_list_init(&layer->surface_list);
+	wl_list_insert(below, &layer->link);
+}
+
 WL_EXPORT void
 weston_compositor_schedule_repaint(struct weston_compositor *compositor)
 {
@@ -1064,7 +1040,8 @@ weston_compositor_fade(struct weston_compositor *compositor, float tint)
 		surface = weston_surface_create(compositor);
 		weston_surface_configure(surface, 0, 0, 8192, 8192);
 		weston_surface_set_color(surface, 0.0, 0.0, 0.0, 0.0);
-		wl_list_insert(&compositor->surface_list, &surface->link);
+		wl_list_insert(&compositor->fade_layer.surface_list,
+			       &surface->layer_link);
 		weston_surface_assign_output(surface);
 		compositor->fade.surface = surface;
 		pixman_region32_init(&surface->input);
@@ -1512,7 +1489,6 @@ WL_EXPORT void
 weston_surface_activate(struct weston_surface *surface,
 			struct weston_input_device *device, uint32_t time)
 {
-	weston_surface_raise(surface);
 	wl_input_device_set_keyboard_focus(&device->input_device,
 					   &surface->surface, time);
 	wl_data_device_set_keyboard_focus(&device->input_device);
@@ -1837,13 +1813,14 @@ input_device_attach(struct wl_client *client,
 
 	if (!buffer_resource && device->sprite->output) {
 		wl_list_remove(&device->sprite->link);
+		wl_list_remove(&device->sprite->layer_link);
 		device->sprite->output = NULL;
 		return;
 	}
 
 	if (!device->sprite->output) {
-		wl_list_insert(&compositor->surface_list,
-			       &device->sprite->link);
+		wl_list_insert(&compositor->cursor_layer.surface_list,
+			       &device->sprite->layer_link);
 		weston_surface_assign_output(device->sprite);
 	}
 
@@ -1856,12 +1833,25 @@ input_device_attach(struct wl_client *client,
 				 buffer->width, buffer->height);
 
 	weston_buffer_attach(buffer, &device->sprite->surface);
+	weston_surface_damage(device->sprite);
 }
 
 const static struct wl_input_device_interface input_device_interface = {
 	input_device_attach,
 };
 
+static void
+handle_drag_surface_destroy(struct wl_listener *listener,
+			    struct wl_resource *resource, uint32_t time)
+{
+	struct weston_input_device *device;
+
+	device = container_of(listener, struct weston_input_device,
+			      drag_surface_destroy_listener);
+
+	device->drag_surface = NULL;
+}
+
 static void unbind_input_device(struct wl_resource *resource)
 {
 	wl_list_remove(&resource->link);
@@ -1898,6 +1888,8 @@ weston_input_device_init(struct weston_input_device *device,
 	device->modifier_state = 0;
 	device->num_tp = 0;
 
+	device->drag_surface_destroy_listener.func = handle_drag_surface_destroy;
+
 	wl_list_insert(ec->input_device_list.prev, &device->link);
 }
 
@@ -1913,6 +1905,42 @@ weston_input_device_release(struct weston_input_device *device)
 	wl_input_device_release(&device->input_device);
 }
 
+static void
+device_setup_new_drag_surface(struct weston_input_device *device,
+			      struct weston_surface *surface)
+{
+	struct wl_input_device *input_device = &device->input_device;
+
+	device->drag_surface = surface;
+
+	weston_surface_set_position(device->drag_surface,
+				    input_device->x, input_device->y);
+
+	wl_list_insert(surface->surface.resource.destroy_listener_list.prev,
+		       &device->drag_surface_destroy_listener.link);
+}
+
+static void
+device_release_drag_surface(struct weston_input_device *device)
+{
+	undef_region(&device->drag_surface->input);
+	wl_list_remove(&device->drag_surface_destroy_listener.link);
+	device->drag_surface = NULL;
+}
+
+static void
+device_map_drag_surface(struct weston_input_device *device)
+{
+	if (device->drag_surface->output ||
+	    !device->drag_surface->buffer)
+		return;
+
+	wl_list_insert(&device->sprite->layer_link,
+		       &device->drag_surface->layer_link);
+	weston_surface_assign_output(device->drag_surface);
+	empty_region(&device->drag_surface->input);
+}
+
 static  void
 weston_input_update_drag_surface(struct wl_input_device *input_device,
 				 int dx, int dy)
@@ -1931,27 +1959,20 @@ weston_input_update_drag_surface(struct wl_input_device *input_device,
 		surface_changed = 1;
 
 	if (!input_device->drag_surface || surface_changed) {
-		undef_region(&device->drag_surface->input);
-		device->drag_surface = NULL;
+		device_release_drag_surface(device);
 		if (!surface_changed)
 			return;
 	}
 
 	if (!device->drag_surface || surface_changed) {
-		device->drag_surface = (struct weston_surface *)
+		struct weston_surface *surface = (struct weston_surface *)
 			input_device->drag_surface;
-
-		weston_surface_set_position(device->drag_surface,
-					    input_device->x, input_device->y);
+		device_setup_new_drag_surface(device, surface);
 	}
 
-	if (device->drag_surface->output == NULL &&
-	    device->drag_surface->buffer) {
-		wl_list_insert(&device->sprite->link,
-			       &device->drag_surface->link);
-		weston_surface_assign_output(device->drag_surface);
-		empty_region(&device->drag_surface->input);
-	}
+	/* the client may not have attached a buffer to the drag surface
+	 * when we setup it up, so check if map is needed on every update */
+	device_map_drag_surface(device);
 
 	/* the client may have attached a buffer with a different size to
 	 * the drag surface, causing the input region to be reset */
@@ -2293,6 +2314,7 @@ weston_compositor_init(struct weston_compositor *ec, struct wl_display *display)
 		ec->bind_display(ec->display, ec->wl_display);
 
 	wl_list_init(&ec->surface_list);
+	wl_list_init(&ec->layer_list);
 	wl_list_init(&ec->input_device_list);
 	wl_list_init(&ec->output_list);
 	wl_list_init(&ec->binding_list);
@@ -2301,6 +2323,9 @@ weston_compositor_init(struct weston_compositor *ec, struct wl_display *display)
 	ec->fade.animation.frame = fade_frame;
 	wl_list_init(&ec->fade.animation.link);
 
+	weston_layer_init(&ec->fade_layer, &ec->layer_list);
+	weston_layer_init(&ec->cursor_layer, &ec->fade_layer.link);
+
 	ec->screenshooter = screenshooter_create(ec);
 
 	wl_data_device_manager_init(ec->wl_display);
diff --git a/src/compositor.h b/src/compositor.h
index 8c57e4f4..6f462493 100644
--- a/src/compositor.h
+++ b/src/compositor.h
@@ -91,7 +91,8 @@ struct weston_output {
 	struct weston_mode *current;
 	struct wl_list mode_list;
 
-	void (*repaint)(struct weston_output *output);
+	void (*repaint)(struct weston_output *output,
+			pixman_region32_t *damage);
 	void (*destroy)(struct weston_output *output);
 	void (*assign_planes)(struct weston_output *output);
 
@@ -106,6 +107,7 @@ struct weston_input_device {
 	struct weston_compositor *compositor;
 	struct weston_surface *sprite;
 	struct weston_surface *drag_surface;
+	struct wl_listener drag_surface_destroy_listener;
 	int32_t hotspot_x, hotspot_y;
 	struct wl_list link;
 	uint32_t modifier_state;
@@ -162,6 +164,11 @@ enum {
 
 struct screenshooter;
 
+struct weston_layer {
+	struct wl_list surface_list;
+	struct wl_list link;
+};
+
 struct weston_compositor {
 	struct wl_shm *shm;
 	struct weston_xserver *wxs;
@@ -180,8 +187,12 @@ struct weston_compositor {
 	/* There can be more than one, but not right now... */
 	struct wl_input_device *input_device;
 
+	struct weston_layer fade_layer;
+	struct weston_layer cursor_layer;
+
 	struct wl_list output_list;
 	struct wl_list input_device_list;
+	struct wl_list layer_list;
 	struct wl_list surface_list;
 	struct wl_list binding_list;
 	struct wl_list animation_list;
@@ -198,8 +209,8 @@ struct weston_compositor {
 	int idle_time;			/* effective timeout, s */
 
 	/* Repaint state. */
-	struct timespec previous_swap;
 	struct wl_array vertices, indices;
+	pixman_region32_t damage;
 
 	uint32_t focus;
 
@@ -260,11 +271,13 @@ struct weston_surface {
 	struct wl_surface surface;
 	struct weston_compositor *compositor;
 	GLuint texture;
+	pixman_region32_t clip;
 	pixman_region32_t damage;
 	pixman_region32_t opaque;
 	pixman_region32_t input;
 	int32_t pitch;
 	struct wl_list link;
+	struct wl_list layer_link;
 	struct wl_list buffer_link;
 	struct weston_shader *shader;
 	GLfloat color[4];
@@ -341,7 +354,8 @@ void
 weston_surface_activate(struct weston_surface *surface,
 			struct weston_input_device *device, uint32_t time);
 void
-weston_surface_draw(struct weston_surface *es, struct weston_output *output);
+weston_surface_draw(struct weston_surface *es,
+		    struct weston_output *output, pixman_region32_t *damage);
 
 void
 notify_motion(struct wl_input_device *device,
@@ -368,6 +382,9 @@ void
 notify_touch(struct wl_input_device *device, uint32_t time, int touch_id,
 	     int x, int y, int touch_type);
 
+void
+weston_layer_init(struct weston_layer *layer, struct wl_list *below);
+
 void
 weston_output_finish_frame(struct weston_output *output, int msecs);
 void
@@ -420,6 +437,9 @@ void
 weston_surface_configure(struct weston_surface *surface,
 			 GLfloat x, GLfloat y, int width, int height);
 
+void
+weston_surface_restack(struct weston_surface *surface, struct wl_list *below);
+
 void
 weston_surface_set_position(struct weston_surface *surface,
 			    GLfloat x, GLfloat y);
diff --git a/src/shell.c b/src/shell.c
index 5abfdb5e..2b61202c 100644
--- a/src/shell.c
+++ b/src/shell.c
@@ -42,6 +42,12 @@ struct wl_shell {
 	struct weston_compositor *compositor;
 	struct weston_shell shell;
 
+	struct weston_layer fullscreen_layer;
+	struct weston_layer panel_layer;
+	struct weston_layer toplevel_layer;
+	struct weston_layer background_layer;
+	struct weston_layer lock_layer;
+
 	struct {
 		struct weston_process process;
 		struct wl_client *client;
@@ -56,7 +62,6 @@ struct wl_shell {
 
 	struct shell_surface *lock_surface;
 	struct wl_listener lock_surface_listener;
-	struct wl_list hidden_surface_list;
 
 	struct wl_list backgrounds;
 	struct wl_list panels;
@@ -93,7 +98,6 @@ struct shell_surface {
 	struct shell_surface *parent;
 
 	enum shell_surface_type type;
-	enum shell_surface_type prev_type;
 	int32_t saved_x, saved_y;
 	bool saved_position_valid;
 
@@ -379,6 +383,8 @@ shell_unset_fullscreen(struct shell_surface *shsurf)
 	shsurf->fullscreen.black_surface = NULL;
 	shsurf->fullscreen_output = NULL;
 	shsurf->surface->force_configure = 1;
+	weston_surface_set_position(shsurf->surface,
+				    shsurf->saved_x, shsurf->saved_y);
 }
 
 static int
@@ -412,7 +418,6 @@ reset_shell_surface_type(struct shell_surface *surface)
 		break;
 	}
 
-	surface->prev_type = surface->type;
 	surface->type = SHELL_SURFACE_NONE;
 	return 0;
 }
@@ -545,11 +550,15 @@ shell_configure_fullscreen(struct shell_surface *shsurf)
 	center_on_output(surface, output);
 
 	if (!shsurf->fullscreen.black_surface)
-		shsurf->fullscreen.black_surface = create_black_surface(surface->compositor,
-									output->x, output->y,
-									output->current->width, output->current->height);
-	wl_list_remove(&shsurf->fullscreen.black_surface->link);
-	wl_list_insert(&surface->link, &shsurf->fullscreen.black_surface->link);
+		shsurf->fullscreen.black_surface =
+			create_black_surface(surface->compositor,
+					     output->x, output->y,
+					     output->current->width,
+					     output->current->height);
+
+	wl_list_remove(&shsurf->fullscreen.black_surface->layer_link);
+	wl_list_insert(&surface->layer_link,
+		       &shsurf->fullscreen.black_surface->layer_link);
 	shsurf->fullscreen.black_surface->output = output;
 
 	switch (shsurf->fullscreen.type) {
@@ -580,22 +589,17 @@ shell_stack_fullscreen(struct shell_surface *shsurf)
 {
 	struct weston_surface *surface = shsurf->surface;
 	struct wl_shell *shell = shell_surface_get_shell(shsurf);
-	struct wl_list *list;
 
-	wl_list_remove(&surface->link);
-	wl_list_remove(&shsurf->fullscreen.black_surface->link);
+	wl_list_remove(&surface->layer_link);
+	wl_list_remove(&shsurf->fullscreen.black_surface->layer_link);
 
-	if (shell->locked) {
-		wl_list_insert(&shell->hidden_surface_list, &surface->link);
-		wl_list_insert(&surface->link, &shsurf->fullscreen.black_surface->link);
-	} else {
-		list = weston_compositor_top(surface->compositor);
-		wl_list_insert(list, &surface->link);
-		wl_list_insert(&surface->link, &shsurf->fullscreen.black_surface->link);
+	wl_list_insert(&shell->fullscreen_layer.surface_list,
+		       &surface->layer_link);
+	wl_list_insert(&surface->layer_link,
+		       &shsurf->fullscreen.black_surface->layer_link);
 
-		weston_surface_damage(surface);
-		weston_surface_damage(shsurf->fullscreen.black_surface);
-	}
+	weston_surface_damage(surface);
+	weston_surface_damage(shsurf->fullscreen.black_surface);
 }
 
 static void
@@ -623,17 +627,15 @@ shell_surface_set_fullscreen(struct wl_client *client,
 	if (reset_shell_surface_type(shsurf))
 		return;
 
-	if (shsurf->prev_type != SHELL_SURFACE_FULLSCREEN) {
-		shsurf->saved_x = es->geometry.x;
-		shsurf->saved_y = es->geometry.y;
-		shsurf->saved_position_valid = true;
-	}
-
 	shsurf->fullscreen_output = shsurf->output;
 	shsurf->fullscreen.type = method;
 	shsurf->fullscreen.framerate = framerate;
 	shsurf->type = SHELL_SURFACE_FULLSCREEN;
 
+	shsurf->saved_x = es->geometry.x;
+	shsurf->saved_y = es->geometry.y;
+	shsurf->saved_position_valid = true;
+
 	if (es->output)
 		shsurf->surface->force_configure = 1;
 
@@ -860,7 +862,6 @@ shell_get_shell_surface(struct wl_client *client,
 	weston_matrix_init(&shsurf->rotation.rotation);
 
 	shsurf->type = SHELL_SURFACE_NONE;
-	shsurf->prev_type = SHELL_SURFACE_NONE;
 
 	wl_client_add_resource(client, &shsurf->resource);
 }
@@ -884,6 +885,11 @@ launch_screensaver(struct wl_shell *shell)
 	if (!shell->screensaver.path)
 		return;
 
+	if (shell->screensaver.process.pid != 0) {
+		fprintf(stderr, "old screensaver still running\n");
+		return;
+	}
+
 	weston_client_launch(shell->compositor,
 			   &shell->screensaver.process,
 			   shell->screensaver.path,
@@ -905,12 +911,12 @@ show_screensaver(struct wl_shell *shell, struct shell_surface *surface)
 	struct wl_list *list;
 
 	if (shell->lock_surface)
-		list = &shell->lock_surface->surface->link;
+		list = &shell->lock_surface->surface->layer_link;
 	else
-		list = &shell->compositor->surface_list;
+		list = &shell->lock_layer.surface_list;
 
-	wl_list_remove(&surface->surface->link);
-	wl_list_insert(list, &surface->surface->link);
+	wl_list_remove(&surface->surface->layer_link);
+	wl_list_insert(list, &surface->surface->layer_link);
 	surface->surface->output = surface->output;
 	weston_surface_damage(surface->surface);
 }
@@ -918,8 +924,8 @@ show_screensaver(struct wl_shell *shell, struct shell_surface *surface)
 static void
 hide_screensaver(struct wl_shell *shell, struct shell_surface *surface)
 {
-	wl_list_remove(&surface->surface->link);
-	wl_list_init(&surface->surface->link);
+	wl_list_remove(&surface->surface->layer_link);
+	wl_list_init(&surface->surface->layer_link);
 	surface->surface->output = NULL;
 }
 
@@ -940,7 +946,7 @@ desktop_shell_set_background(struct wl_client *client,
 	wl_list_for_each(priv, &shell->backgrounds, link) {
 		if (priv->output == output_resource->data) {
 			priv->surface->output = NULL;
-			wl_list_remove(&priv->surface->link);
+			wl_list_remove(&priv->surface->layer_link);
 			wl_list_remove(&priv->link);
 			break;
 		}
@@ -978,7 +984,7 @@ desktop_shell_set_panel(struct wl_client *client,
 	wl_list_for_each(priv, &shell->panels, link) {
 		if (priv->output == output_resource->data) {
 			priv->surface->output = NULL;
-			wl_list_remove(&priv->surface->link);
+			wl_list_remove(&priv->surface->layer_link);
 			wl_list_remove(&priv->link);
 			break;
 		}
@@ -1038,8 +1044,6 @@ desktop_shell_set_lock_surface(struct wl_client *client,
 static void
 resume_desktop(struct wl_shell *shell)
 {
-	struct weston_surface *surface;
-	struct wl_list *list;
 	struct shell_surface *tmp;
 
 	wl_list_for_each(tmp, &shell->screensaver.surfaces, link)
@@ -1047,21 +1051,12 @@ resume_desktop(struct wl_shell *shell)
 
 	terminate_screensaver(shell);
 
-	wl_list_for_each(surface, &shell->hidden_surface_list, link)
-		weston_surface_assign_output(surface);
-
-	if (wl_list_empty(&shell->backgrounds)) {
-		list = &shell->compositor->surface_list;
-	} else {
-		struct shell_surface *background;
-		background = container_of(shell->backgrounds.prev,
-					  struct shell_surface, link);
-		list = background->surface->link.prev;
-	}
-
-	if (!wl_list_empty(&shell->hidden_surface_list))
-		wl_list_insert_list(list, &shell->hidden_surface_list);
-	wl_list_init(&shell->hidden_surface_list);
+	wl_list_remove(&shell->lock_layer.link);
+	wl_list_insert(&shell->compositor->cursor_layer.link,
+		       &shell->fullscreen_layer.link);
+	wl_list_insert(&shell->fullscreen_layer.link,
+		       &shell->panel_layer.link);
+	wl_list_insert(&shell->panel_layer.link, &shell->toplevel_layer.link);
 
 	shell->locked = false;
 	weston_compositor_repick(shell->compositor);
@@ -1383,7 +1378,6 @@ activate(struct weston_shell *base, struct weston_surface *es,
 {
 	struct wl_shell *shell = container_of(base, struct wl_shell, shell);
 	struct weston_compositor *compositor = shell->compositor;
-	struct wl_list *list;
 
 	weston_surface_activate(es, device, time);
 
@@ -1392,35 +1386,23 @@ activate(struct weston_shell *base, struct weston_surface *es,
 
 	switch (get_shell_surface_type(es)) {
 	case SHELL_SURFACE_BACKGROUND:
-		/* put background back to bottom */
-		wl_list_remove(&es->link);
-		wl_list_insert(compositor->surface_list.prev, &es->link);
-		break;
 	case SHELL_SURFACE_PANEL:
-		/* already put on top */
+	case SHELL_SURFACE_LOCK:
 		break;
+
 	case SHELL_SURFACE_SCREENSAVER:
 		/* always below lock surface */
-		if (shell->lock_surface) {
-			wl_list_remove(&es->link);
-			wl_list_insert(&shell->lock_surface->surface->link,
-				       &es->link);
-		}
+		if (shell->lock_surface)
+			weston_surface_restack(es,
+					       &shell->lock_surface->surface->layer_link);
 		break;
 	case SHELL_SURFACE_FULLSCREEN:
 		/* should on top of panels */
 		break;
 	default:
-		if (!shell->locked) {
-			list = weston_compositor_top(compositor);
-
-			/* bring panel back to top */
-			struct shell_surface *panel;
-			wl_list_for_each(panel, &shell->panels, link) {
-				wl_list_remove(&panel->surface->link);
-				wl_list_insert(list, &panel->surface->link);
-			}
-		}
+		weston_surface_restack(es,
+				       &shell->toplevel_layer.surface_list);
+		break;
 	}
 }
 
@@ -1451,9 +1433,6 @@ static void
 lock(struct weston_shell *base)
 {
 	struct wl_shell *shell = container_of(base, struct wl_shell, shell);
-	struct wl_list *surface_list = &shell->compositor->surface_list;
-	struct weston_surface *cur;
-	struct weston_surface *tmp;
 	struct weston_input_device *device;
 	struct shell_surface *shsurf;
 	struct weston_output *output;
@@ -1469,28 +1448,15 @@ lock(struct weston_shell *base)
 
 	shell->locked = true;
 
-	/* Move all surfaces from compositor's list to our hidden list,
-	 * except the background. This way nothing else can show or
-	 * receive input events while we are locked. */
+	/* Hide all surfaces by removing the fullscreen, panel and
+	 * toplevel layers.  This way nothing else can show or receive
+	 * input events while we are locked. */
 
-	if (!wl_list_empty(&shell->hidden_surface_list)) {
-		fprintf(stderr,
-		"%s: Assertion failed: hidden_surface_list is not empty.\n",
-								__func__);
-	}
-
-	wl_list_for_each_safe(cur, tmp, surface_list, link) {
-		/* skip input device sprites, cur->surface is uninitialised */
-		if (cur->surface.resource.client == NULL)
-			continue;
-
-		if (get_shell_surface_type(cur) == SHELL_SURFACE_BACKGROUND)
-			continue;
-
-		cur->output = NULL;
-		wl_list_remove(&cur->link);
-		wl_list_insert(shell->hidden_surface_list.prev, &cur->link);
-	}
+	wl_list_remove(&shell->panel_layer.link);
+	wl_list_remove(&shell->toplevel_layer.link);
+	wl_list_remove(&shell->fullscreen_layer.link);
+	wl_list_insert(&shell->compositor->cursor_layer.link,
+		       &shell->lock_layer.link);
 
 	launch_screensaver(shell);
 
@@ -1558,24 +1524,14 @@ map(struct weston_shell *base, struct weston_surface *surface,
 {
 	struct wl_shell *shell = container_of(base, struct wl_shell, shell);
 	struct weston_compositor *compositor = shell->compositor;
-	struct wl_list *list;
 	struct shell_surface *shsurf;
 	enum shell_surface_type surface_type = SHELL_SURFACE_NONE;
-	int do_configure;
 	int panel_height = 0;
 
 	shsurf = get_shell_surface(surface);
 	if (shsurf)
 		surface_type = shsurf->type;
 
-	if (shell->locked) {
-		list = &shell->hidden_surface_list;
-		do_configure = 0;
-	} else {
-		list = weston_compositor_top(compositor);
-		do_configure = 1;
-	}
-
 	surface->geometry.width = width;
 	surface->geometry.height = height;
 	surface->geometry.dirty = 1;
@@ -1618,19 +1574,19 @@ map(struct weston_shell *base, struct weston_surface *surface,
 	switch (surface_type) {
 	case SHELL_SURFACE_BACKGROUND:
 		/* background always visible, at the bottom */
-		wl_list_insert(compositor->surface_list.prev, &surface->link);
-		do_configure = 1;
+		wl_list_insert(&shell->background_layer.surface_list,
+			       &surface->layer_link);
 		break;
 	case SHELL_SURFACE_PANEL:
 		/* panel always on top, hidden while locked */
-		wl_list_insert(list, &surface->link);
+		wl_list_insert(&shell->panel_layer.surface_list,
+			       &surface->layer_link);
 		break;
 	case SHELL_SURFACE_LOCK:
 		/* lock surface always visible, on top */
-		wl_list_insert(&compositor->surface_list, &surface->link);
-
+		wl_list_insert(&shell->lock_layer.surface_list,
+			       &surface->layer_link);
 		weston_compositor_wake(compositor);
-		do_configure = 1;
 		break;
 	case SHELL_SURFACE_SCREENSAVER:
 		/* If locked, show it. */
@@ -1641,32 +1597,20 @@ map(struct weston_shell *base, struct weston_surface *surface,
 			if (!shell->lock_surface)
 				compositor->state = WESTON_COMPOSITOR_IDLE;
 		}
-		do_configure = 0;
 		break;
 	case SHELL_SURFACE_FULLSCREEN:
-		do_configure = 1;
-		break;
 	case SHELL_SURFACE_NONE:
-		do_configure = 0;
 		break;
 	default:
-		/* everything else just below the panel */
-		if (!wl_list_empty(&shell->panels)) {
-			struct shell_surface *panel =
-				container_of(shell->panels.prev,
-					     struct shell_surface, link);
-			wl_list_insert(&panel->surface->link, &surface->link);
-		} else {
-			wl_list_insert(list, &surface->link);
-		}
+		wl_list_insert(&shell->toplevel_layer.surface_list,
+			       &surface->layer_link); 
+		break;
 	}
 
-	if (do_configure) {
-		weston_surface_assign_output(surface);
-		weston_compositor_repick(compositor);
-		if (surface_type == SHELL_SURFACE_MAXIMIZED)
-			surface->output = shsurf->output;
-	}
+	weston_surface_assign_output(surface);
+	weston_compositor_repick(compositor);
+	if (surface_type == SHELL_SURFACE_MAXIMIZED)
+		surface->output = shsurf->output;
 
 	switch (surface_type) {
 	case SHELL_SURFACE_TOPLEVEL:
@@ -1697,10 +1641,8 @@ configure(struct weston_shell *base, struct weston_surface *surface,
 	struct shell_surface *shsurf;
 
 	shsurf = get_shell_surface(surface);
-	if (shsurf) {
+	if (shsurf)
 		surface_type = shsurf->type;
-		prev_surface_type = shsurf->prev_type;
-	}
 
 	surface->geometry.x = x;
 	surface->geometry.y = y;
@@ -1724,18 +1666,6 @@ configure(struct weston_shell *base, struct weston_surface *surface,
 			get_output_panel_height(shell,surface->output);
 		break;
 	case SHELL_SURFACE_TOPLEVEL:
-		if (prev_surface_type != SHELL_SURFACE_TOPLEVEL) {
-			if (shsurf->saved_position_valid &&
-			    shsurf->saved_x != surface->geometry.x &&
-			    shsurf->saved_y != surface->geometry.y) {
-				weston_surface_set_position(surface,
-							    shsurf->saved_x,
-							    shsurf->saved_y);
-			} else if (!shsurf->saved_position_valid) {
-				weston_surface_set_position(surface, 10 + random() % 400,
-							    10 + random() % 400);
-			}
-		}
 		break;
 	default:
 		break;
@@ -2071,11 +2001,17 @@ shell_init(struct weston_compositor *ec)
 	shell->shell.configure = configure;
 	shell->shell.destroy = shell_destroy;
 
-	wl_list_init(&shell->hidden_surface_list);
 	wl_list_init(&shell->backgrounds);
 	wl_list_init(&shell->panels);
 	wl_list_init(&shell->screensaver.surfaces);
 
+	weston_layer_init(&shell->fullscreen_layer, &ec->cursor_layer.link);
+	weston_layer_init(&shell->panel_layer, &shell->fullscreen_layer.link);
+	weston_layer_init(&shell->toplevel_layer, &shell->panel_layer.link);
+	weston_layer_init(&shell->background_layer,
+			  &shell->toplevel_layer.link);
+	wl_list_init(&shell->lock_layer.surface_list);
+
 	shell_configuration(shell);
 
 	if (wl_display_add_global(ec->wl_display, &wl_shell_interface,