diff --git a/dom0/misc/qmemman.conf b/dom0/misc/qmemman.conf
new file mode 100644
index 00000000..f43daa9f
--- /dev/null
+++ b/dom0/misc/qmemman.conf
@@ -0,0 +1,13 @@
+# The only section in this file
+[global]
+# vm-min-mem - give at least this amount of RAM for dynamically managed VM
+#  Default: 200M
+vm-min-mem = 200M
+
+# dom0-mem-boost - additional memory given to dom0 for disk caches etc
+#  Default: 350M
+dom0-mem-boost = 350M
+
+# cache-margin-factor - calculate VM preferred memory as (used memory)*cache-margin-factor
+#  Default: 1.3
+cache-margin-factor = 1.3
diff --git a/dom0/qmemman/qmemman_algo.py b/dom0/qmemman/qmemman_algo.py
index d8c1f6b2..b61d9d17 100755
--- a/dom0/qmemman/qmemman_algo.py
+++ b/dom0/qmemman/qmemman_algo.py
@@ -1,5 +1,11 @@
 import string
 
+# This are only defaults - can be overriden by QMemmanServer with values from
+# config file
+CACHE_FACTOR = 1.3
+MIN_PREFMEM = 200*1024*1024
+DOM0_MEM_BOOST = 350*1024*1024
+
 #untrusted meminfo size is taken from xenstore key, thus its size is limited
 #so splits do not require excessive memory
 def parse_meminfo(untrusted_meminfo):
@@ -57,8 +63,6 @@ def refresh_meminfo_for_domain(domain, untrusted_xenstore_key):
         domain.mem_used =  domain.meminfo['MemTotal'] - domain.meminfo['MemFree'] - domain.meminfo['Cached'] - domain.meminfo['Buffers'] + domain.meminfo['SwapTotal'] - domain.meminfo['SwapFree']
                         
 def prefmem(domain):
-    CACHE_FACTOR = 1.3
-    MIN_PREFMEM = 200*1024*1024
 #dom0 is special, as it must have large cache, for vbds. Thus, give it a special boost
     if domain.id == '0':
         return min(domain.mem_used*CACHE_FACTOR + 350*1024*1024, domain.memory_maximum)
diff --git a/dom0/qmemman/qmemman_server.py b/dom0/qmemman/qmemman_server.py
index 63fddfb5..515b5fdd 100755
--- a/dom0/qmemman/qmemman_server.py
+++ b/dom0/qmemman/qmemman_server.py
@@ -6,6 +6,12 @@ import xen.lowlevel.xs
 import sys
 import os
 from qmemman import SystemState
+import qmemman_algo
+from ConfigParser import SafeConfigParser
+from optparse import OptionParser
+from qubesutils import parse_size
+
+config_path = '/etc/qubes/qmemman.conf'
 
 system_state = SystemState()
 global_lock = thread.allocate_lock()
@@ -113,5 +119,23 @@ def start_server():
 class QMemmanServer:
     @staticmethod          
     def main():
+        usage = "usage: %prog [options]"
+        parser = OptionParser(usage)
+        parser.add_option("-c", "--config", action="store", dest="config", default=config_path)
+        (options, args) = parser.parse_args()
+
+        config = SafeConfigParser({
+                'vm-min-mem': str(qmemman_algo.MIN_PREFMEM),
+                'dom0-mem-boost': str(qmemman_algo.DOM0_MEM_BOOST),
+                'cache-margin-factor': str(qmemman_algo.CACHE_FACTOR)
+                })
+        config.read(options.config)
+        if config.has_section('global'):
+            qmemman_algo.MIN_PREFMEM = parse_size(config.get('global', 'vm-min-mem'))
+            qmemman_algo.DOM0_MEM_BOOST = parse_size(config.get('global', 'dom0-mem-boost'))
+            qmemman_algo.CACHE_FACTOR = config.getfloat('global', 'cache-margin-factor')
+
+        print "values: %s, %s, %s" % (str(qmemman_algo.MIN_PREFMEM), str(qmemman_algo.DOM0_MEM_BOOST), str(qmemman_algo.CACHE_FACTOR))
+
         thread.start_new_thread(start_server, tuple([]))
         XS_Watcher().watch_loop()
diff --git a/rpm_spec/core-dom0.spec b/rpm_spec/core-dom0.spec
index 0f4624b6..aa6500c2 100644
--- a/rpm_spec/core-dom0.spec
+++ b/rpm_spec/core-dom0.spec
@@ -91,6 +91,9 @@ cp qvm-core/__init__.py[co] $RPM_BUILD_ROOT%{python_sitearch}/qubes
 cp qmemman/qmemman*py $RPM_BUILD_ROOT%{python_sitearch}/qubes
 cp qmemman/qmemman*py[co] $RPM_BUILD_ROOT%{python_sitearch}/qubes
 
+mkdir -p $RPM_BUILD_DIR/etc/qubes
+cp dom0/misc/qmemman.conf $RPM_BUILD_DIR%{_sysconfdir}/qubes/
+
 mkdir -p $RPM_BUILD_ROOT/usr/lib/qubes
 cp aux-tools/patch_appvm_initramfs.sh $RPM_BUILD_ROOT/usr/lib/qubes
 cp aux-tools/unbind_pci_device.sh $RPM_BUILD_ROOT/usr/lib/qubes
@@ -304,6 +307,7 @@ fi
 /etc/init.d/qubes_core
 /etc/init.d/qubes_netvm
 /etc/init.d/qubes_setupdvm
+%config(noreplace) %{_sysconfdir}/qubes/qmemman.conf
 /usr/bin/qvm-*
 /usr/bin/qubes-*
 /usr/bin/qclipd