diff --git a/src/vs/workbench/browser/layout.ts b/src/vs/workbench/browser/layout.ts
index e60339f6bf2ebbfbdeeb9b068b12a5f4881bcf3a..1a98bc595729a848eefa46b2303fdc606e9ffd77 100644
--- a/src/vs/workbench/browser/layout.ts
+++ b/src/vs/workbench/browser/layout.ts
@@ -19,9 +19,9 @@ import {IEventService} from 'vs/platform/event/common/event';
 
 const DEFAULT_MIN_PART_WIDTH = 170;
 const DEFAULT_MIN_PANEL_PART_HEIGHT = 170;
+const DEFAULT_MIN_EDITOR_PART_HEIGHT = 170;
 const HIDE_SIDEBAR_WIDTH_THRESHOLD = 50;
 const HIDE_PANEL_HEIGHT_THRESHOLD = 50;
-const PANEL_HEIGHT_SCREEN_LIMIT = 0.8;
 
 const LAYOUT_RELATED_PREFERENCES = [
 	Preferences.THEME
@@ -309,7 +309,7 @@ export class WorkbenchLayout implements IVerticalSashLayoutProvider, IHorizontal
 		if (isPanelHidden) {
 			panelHeight = 0;
 		} else if (this.panelHeight > 0) {
-			panelHeight = Math.min(sidebarSize.height * PANEL_HEIGHT_SCREEN_LIMIT, Math.max(this.computedStyles.panel.minHeight, this.panelHeight));
+			panelHeight = Math.min(sidebarSize.height - DEFAULT_MIN_EDITOR_PART_HEIGHT, Math.max(this.computedStyles.panel.minHeight, this.panelHeight));
 		} else {
 			panelHeight = sidebarSize.height * 0.4;
 		}