diff --git a/chrome/content/zotero/tinymce/note.html b/chrome/content/zotero/tinymce/note.html
index 1544cb61c..e4a8d3026 100755
--- a/chrome/content/zotero/tinymce/note.html
+++ b/chrome/content/zotero/tinymce/note.html
@@ -12,7 +12,7 @@
 		content_css : "css/note-content.css",
 		button_tile_map : true,
 		language : "en", // TODO: localize
-		entity_encoding : "raw",
+		entities : "160,nbsp",
 		gecko_spellcheck : true,
 		
 		handle_event_callback : function (event) {
diff --git a/chrome/content/zotero/xpcom/data/item.js b/chrome/content/zotero/xpcom/data/item.js
index a5dd112fb..3eb5a2b23 100644
--- a/chrome/content/zotero/xpcom/data/item.js
+++ b/chrome/content/zotero/xpcom/data/item.js
@@ -3679,21 +3679,42 @@ Zotero.Item.prototype.diff = function (item, includeMatches, ignoreFields) {
 	}
 	
 	if (thisData.note != undefined) {
-		// replace() keeps Windows newlines from triggering erroneous conflicts,
-		// though this should really be fixed at the data layer level
+		// Whitespace normalization
 		//
-		// Using a try/catch to avoid unexpected errors in 2.1 Final
+		// Ideally this would all be fixed elsewhere so we didn't have to
+		// convert on every sync diff
+		//
+		// TEMP: Using a try/catch to avoid unexpected errors in 2.1 releases
 		try {
-			changed = thisData.note.replace(/\r\n/g, "\n") != otherData.note.replace(/\r\n/g, "\n");
+			var thisNote = thisData.note;
+			var otherNote = otherData.note;
+			
+			// Stop Windows newlines from triggering erroneous conflicts
+			thisNote = thisNote.replace(/\r\n/g, "\n");
+			otherNote = otherNote.replace(/\r\n/g, "\n");
+			
+			// Normalize multiple spaces (due to differences TinyMCE, Z.U.text2html(),
+			// and the server)
+			var re = /(  |  |\u00a0 |\u00a0\u00a0)/g;
+			thisNote = thisNote.replace(re, "  ");
+			otherNote = otherNote.replace(re, "  ");
+			
+			// Normalize new paragraphs
+			var re = /<p>(&nbsp;|\u00a0)<\/p>/g;
+			thisNote = thisNote.replace(re, "<p> </p>");
+			otherNote = otherNote.replace(re, "<p> </p>");
+			
+			changed = thisNote != otherNote;
 		}
 		catch (e) {
 			Zotero.debug(e);
 			Components.utils.reportError(e);
-			changed = thisData.note != otherData.note;
+			changed = thisNote != otherNote;
 		}
+		
 		if (includeMatches || changed) {
-			diff[0].note = thisData.note;
-			diff[1].note = otherData.note;
+			diff[0].note = thisNote;
+			diff[1].note = otherNote;
 		}
 		
 		if (changed) {
diff --git a/chrome/content/zotero/xpcom/utilities.js b/chrome/content/zotero/xpcom/utilities.js
index 4175ada15..ea95e5f04 100644
--- a/chrome/content/zotero/xpcom/utilities.js
+++ b/chrome/content/zotero/xpcom/utilities.js
@@ -159,8 +159,7 @@ Zotero.Utilities = {
 		if (singleNewlineIsParagraph) {
 			str = '<p>'
 					+ str.replace(/\n/g, '</p><p>')
-						.replace(/\t/g, '&nbsp;&nbsp;&nbsp;&nbsp;')
-						.replace(/  /g, '&nbsp;&nbsp;')
+						.replace(/  /g, '&nbsp; ')
 				+ '</p>';
 		}
 		// \n\n => <p>, \n => <br/>
@@ -169,8 +168,7 @@ Zotero.Utilities = {
 			str = '<p>'
 					+ str.replace(/\n\n/g, '</p><p>')
 						.replace(/\n/g, '<br/>')
-						.replace(/\t/g, '&nbsp;&nbsp;&nbsp;&nbsp;')
-						.replace(/  /g, '&nbsp;&nbsp;')
+						.replace(/  /g, '&nbsp; ')
 				+ '</p>';
 		}
 		return str.replace(/<p>\s*<\/p>/g, '<p>&nbsp;</p>');