diff --git a/helix-term/src/application.rs b/helix-term/src/application.rs
index 0d40fa66f0257..eeef1dd086f60 100644
--- a/helix-term/src/application.rs
+++ b/helix-term/src/application.rs
@@ -13,7 +13,7 @@ use helix_lsp::{
 use helix_view::{
     align_view,
     document::DocumentSavedEventResult,
-    editor::{ConfigEvent, EditorEvent},
+    editor::{ConfigEvent, DiffSource, EditorEvent},
     graphics::Rect,
     theme,
     tree::Layout,
@@ -351,11 +351,15 @@ impl Application {
             // the Application can apply it.
             ConfigEvent::Update(editor_config) => {
                 let mut app_config = (*self.config.load().clone()).clone();
+                let update_diff_base = app_config.editor.diff_source != editor_config.diff_source;
                 app_config.editor = *editor_config;
                 if let Err(err) = self.terminal.reconfigure(app_config.editor.clone().into()) {
                     self.editor.set_error(err.to_string());
                 };
                 self.config.store(Arc::new(app_config));
+                if update_diff_base {
+                    self.editor.update_diff_base();
+                }
             }
         }
 
@@ -557,6 +561,15 @@ impl Application {
             self.editor.refresh_language_servers(id);
         }
 
+        let diff_source = self.editor.config().diff_source;
+        let doc = doc_mut!(self.editor, &doc_save_event.doc_id);
+        doc.set_original_text(doc.text().clone());
+        if diff_source == DiffSource::File {
+            if let Some(path) = doc.path().cloned() {
+                doc.update_diff_base(&path, &self.editor.diff_provider, diff_source);
+            }
+        }
+
         // TODO: fix being overwritten by lsp
         self.editor.set_status(format!(
             "'{}' written, {}L {}B",
diff --git a/helix-term/src/commands/typed.rs b/helix-term/src/commands/typed.rs
index a9ff70b913227..1133d89cd5292 100644
--- a/helix-term/src/commands/typed.rs
+++ b/helix-term/src/commands/typed.rs
@@ -1266,10 +1266,12 @@ fn reload(
     }
 
     let scrolloff = cx.editor.config().scrolloff;
+    let diff_source = cx.editor.config().diff_source;
     let (view, doc) = current!(cx.editor);
-    doc.reload(view, &cx.editor.diff_provider).map(|_| {
-        view.ensure_cursor_in_view(doc, scrolloff);
-    })?;
+    doc.reload(view, &cx.editor.diff_provider, diff_source)
+        .map(|_| {
+            view.ensure_cursor_in_view(doc, scrolloff);
+        })?;
     if let Some(path) = doc.path() {
         cx.editor
             .language_servers
@@ -1307,6 +1309,7 @@ fn reload_all(
         .collect();
 
     for (doc_id, view_ids) in docs_view_ids {
+        let diff_source = cx.editor.config().diff_source;
         let doc = doc_mut!(cx.editor, &doc_id);
 
         // Every doc is guaranteed to have at least 1 view at this point.
@@ -1315,7 +1318,7 @@ fn reload_all(
         // Ensure that the view is synced with the document's history.
         view.sync_changes(doc);
 
-        doc.reload(view, &cx.editor.diff_provider)?;
+        doc.reload(view, &cx.editor.diff_provider, diff_source)?;
         if let Some(path) = doc.path() {
             cx.editor
                 .language_servers
diff --git a/helix-view/src/document.rs b/helix-view/src/document.rs
index 05895b7732382..280f166adcd81 100644
--- a/helix-view/src/document.rs
+++ b/helix-view/src/document.rs
@@ -33,7 +33,7 @@ use helix_core::{
     ChangeSet, Diagnostic, LineEnding, Range, Rope, RopeBuilder, Selection, Syntax, Transaction,
 };
 
-use crate::editor::Config;
+use crate::editor::{Config, DiffSource};
 use crate::{DocumentId, Editor, Theme, View, ViewId};
 
 /// 8kB of buffer space for encoding and decoding `Rope`s.
@@ -130,6 +130,7 @@ impl SavePoint {
 pub struct Document {
     pub(crate) id: DocumentId,
     text: Rope,
+    original_text: Rope,
     selections: HashMap<ViewId, Selection>,
 
     /// Inlay hints annotations for the document, by view.
@@ -652,7 +653,8 @@ impl Document {
             path: None,
             encoding,
             has_bom,
-            text,
+            text: text.clone(),
+            original_text: text,
             selections: HashMap::default(),
             inlay_hints: HashMap::default(),
             inlay_hints_oudated: false,
@@ -991,7 +993,12 @@ impl Document {
     }
 
     /// Reload the document from its path.
-    pub fn reload(&mut self, view: &mut View, diff_provider: &Git) -> Result<(), Error> {
+    pub fn reload(
+        &mut self,
+        view: &mut View,
+        diff_provider: &Git,
+        diff_source: DiffSource,
+    ) -> Result<(), Error> {
         let encoding = self.encoding;
         let path = self
             .path()
@@ -1017,23 +1024,9 @@ impl Document {
 
         self.detect_indent_and_line_ending();
 
-        match diff_provider.get_diff_base(&path) {
-            Ok(diff_base) => self.set_diff_base(diff_base),
-            Err(err) => {
-                log::info!("{err:#?}");
-                log::info!("failed to open diff base for for {}", path.display());
-                self.diff_handle = None;
-            }
-        }
+        self.original_text = rope;
 
-        self.version_control_head = match diff_provider.get_current_head_name(&path) {
-            Ok(res) => Some(res),
-            Err(err) => {
-                log::info!("{err:#?}");
-                log::info!("failed to obtain current head name for {}", path.display());
-                None
-            }
-        };
+        self.update_diff_base(&path, diff_provider, diff_source);
 
         Ok(())
     }
@@ -1591,16 +1584,48 @@ impl Document {
     /// Intialize/updates the differ for this document with a new base.
     pub fn set_diff_base(&mut self, diff_base: Vec<u8>) {
         if let Ok((diff_base, ..)) = from_reader(&mut diff_base.as_slice(), Some(self.encoding)) {
-            if let Some(differ) = &self.diff_handle {
-                differ.update_diff_base(diff_base);
-                return;
-            }
-            self.diff_handle = Some(DiffHandle::new(diff_base, self.text.clone()))
+            self.set_diff_base_raw(diff_base);
         } else {
             self.diff_handle = None;
         }
     }
 
+    pub fn set_diff_base_raw(&mut self, diff_base: Rope) {
+        if let Some(differ) = &self.diff_handle {
+            differ.update_diff_base(diff_base);
+            return;
+        }
+        self.diff_handle = Some(DiffHandle::new(diff_base, self.text.clone()))
+    }
+
+    pub fn update_diff_base(&mut self, path: &Path, diff_provider: &Git, diff_source: DiffSource) {
+        match diff_source {
+            DiffSource::Git => {
+                match diff_provider.get_diff_base(path) {
+                    Ok(diff_base) => self.set_diff_base(diff_base),
+                    Err(err) => {
+                        log::info!("{err:#?}");
+                        log::info!("failed to open diff base for for {}", path.display());
+                        self.diff_handle = None;
+                    }
+                }
+
+                self.version_control_head = match diff_provider.get_current_head_name(path) {
+                    Ok(res) => Some(res),
+                    Err(err) => {
+                        log::info!("{err:#?}");
+                        log::info!("failed to obtain current head name for {}", path.display());
+                        None
+                    }
+                };
+            }
+            DiffSource::File => {
+                self.set_diff_base_raw(self.original_text.clone());
+                self.version_control_head = None;
+            }
+        }
+    }
+
     pub fn version_control_head(&self) -> Option<Arc<Box<str>>> {
         self.version_control_head.as_ref().map(|a| a.load_full())
     }
@@ -1650,6 +1675,15 @@ impl Document {
         &self.text
     }
 
+    #[inline]
+    pub fn original_text(&self) -> &Rope {
+        &self.original_text
+    }
+
+    pub fn set_original_text(&mut self, text: Rope) {
+        self.original_text = text;
+    }
+
     #[inline]
     pub fn selection(&self, view_id: ViewId) -> &Selection {
         &self.selections[&view_id]
diff --git a/helix-view/src/editor.rs b/helix-view/src/editor.rs
index b140a5954c61a..4474775b14dc2 100644
--- a/helix-view/src/editor.rs
+++ b/helix-view/src/editor.rs
@@ -73,6 +73,14 @@ where
     )
 }
 
+#[derive(Debug, Default, Clone, Copy, PartialEq, Eq, Serialize, Deserialize)]
+#[serde(rename_all = "kebab-case")]
+pub enum DiffSource {
+    #[default]
+    Git,
+    File,
+}
+
 #[derive(Debug, Clone, PartialEq, Eq, Serialize, Deserialize)]
 #[serde(rename_all = "kebab-case", default, deny_unknown_fields)]
 pub struct GutterConfig {
@@ -289,6 +297,9 @@ pub struct Config {
     pub default_line_ending: LineEndingConfig,
     /// Enables smart tab
     pub smart_tab: Option<SmartTabConfig>,
+    #[serde(default)]
+    /// What the diff gutter should diff against
+    pub diff_source: DiffSource,
 }
 
 #[derive(Debug, Clone, PartialEq, Deserialize, Serialize, Eq, PartialOrd, Ord)]
@@ -843,6 +854,7 @@ impl Default for Config {
             workspace_lsp_roots: Vec::new(),
             default_line_ending: LineEndingConfig::default(),
             smart_tab: Some(SmartTabConfig::default()),
+            diff_source: DiffSource::default(),
         }
     }
 }
@@ -1445,22 +1457,7 @@ impl Editor {
                 self.config.clone(),
             )?;
 
-            match self.diff_provider.get_diff_base(&path) {
-                Ok(diff_base) => doc.set_diff_base(diff_base),
-                Err(err) => {
-                    log::info!("{err:#?}");
-                    log::info!("failed to open diff base for for {}", path.display());
-                }
-            }
-
-            doc.set_version_control_head(match self.diff_provider.get_current_head_name(&path) {
-                Ok(res) => Some(res),
-                Err(err) => {
-                    log::info!("{err:#?}");
-                    log::info!("failed to obtain current head name for {}", path.display());
-                    None
-                }
-            });
+            doc.update_diff_base(&path, &self.diff_provider, self.config().diff_source);
 
             let id = self.new_document(doc);
             let _ = self.launch_language_servers(id);
@@ -1832,6 +1829,15 @@ impl Editor {
             .as_ref()
             .and_then(|debugger| debugger.current_stack_frame())
     }
+
+    pub fn update_diff_base(&mut self) {
+        let diff_source = self.config().diff_source;
+        for doc in self.documents.values_mut() {
+            if let Some(path) = doc.path().cloned() {
+                doc.update_diff_base(&path, &self.diff_provider, diff_source);
+            }
+        }
+    }
 }
 
 fn try_restore_indent(doc: &mut Document, view: &mut View) {