diff --git a/builtin/providers/azurerm/resource_arm_virtual_machine_test.go b/builtin/providers/azurerm/resource_arm_virtual_machine_test.go
index a37fba2d4..789e6b059 100644
--- a/builtin/providers/azurerm/resource_arm_virtual_machine_test.go
+++ b/builtin/providers/azurerm/resource_arm_virtual_machine_test.go
@@ -14,11 +14,9 @@ func TestAccAzureRMVirtualMachine_basicLinuxMachine(t *testing.T) {
 	ri := acctest.RandInt()
 	config := fmt.Sprintf(testAccAzureRMVirtualMachine_basicLinuxMachine, ri, ri, ri, ri, ri, ri, ri)
 	resource.Test(t, resource.TestCase{
-		PreCheck:  func() { testAccPreCheck(t) },
-		Providers: testAccProviders,
-		CheckDestroy: resource.ComposeTestCheckFunc(
-			testCheckAzureRMVirtualMachineDestroy,
-		),
+		PreCheck:     func() { testAccPreCheck(t) },
+		Providers:    testAccProviders,
+		CheckDestroy: testCheckAzureRMVirtualMachineDestroy,
 		Steps: []resource.TestStep{
 			{
 				Config: config,
@@ -169,6 +167,52 @@ func TestAccAzureRMVirtualMachine_winRMConfig(t *testing.T) {
 	})
 }
 
+func TestAccAzureRMVirtualMachine_deleteVHDOptOut(t *testing.T) {
+	ri := acctest.RandInt()
+	preConfig := fmt.Sprintf(testAccAzureRMVirtualMachine_basicLinuxMachine, ri, ri, ri, ri, ri, ri, ri)
+	postConfig := fmt.Sprintf(testAccAzureRMVirtualMachine_basicLinuxMachineDeleteVM, ri, ri, ri, ri, ri)
+	resource.Test(t, resource.TestCase{
+		PreCheck:     func() { testAccPreCheck(t) },
+		Providers:    testAccProviders,
+		CheckDestroy: testCheckAzureRMVirtualMachineDestroy,
+		Steps: []resource.TestStep{
+			{
+				Config: preConfig,
+				Check: resource.ComposeTestCheckFunc(
+					testCheckAzureRMVirtualMachineExists("azurerm_virtual_machine.test"),
+				),
+			},
+			{
+				Config: postConfig,
+				Check:  testCheckAzureRMVirtualMachineOSDiskVHDExistance(true),
+			},
+		},
+	})
+}
+
+func TestAccAzureRMVirtualMachine_deleteVHDOptIn(t *testing.T) {
+	ri := acctest.RandInt()
+	preConfig := fmt.Sprintf(testAccAzureRMVirtualMachine_basicLinuxMachineDestroyOSDisk, ri, ri, ri, ri, ri, ri, ri)
+	postConfig := fmt.Sprintf(testAccAzureRMVirtualMachine_basicLinuxMachineDeleteVM, ri, ri, ri, ri, ri)
+	resource.Test(t, resource.TestCase{
+		PreCheck:     func() { testAccPreCheck(t) },
+		Providers:    testAccProviders,
+		CheckDestroy: testCheckAzureRMVirtualMachineDestroy,
+		Steps: []resource.TestStep{
+			{
+				Config: preConfig,
+				Check: resource.ComposeTestCheckFunc(
+					testCheckAzureRMVirtualMachineExists("azurerm_virtual_machine.test"),
+				),
+			},
+			{
+				Config: postConfig,
+				Check:  testCheckAzureRMVirtualMachineOSDiskVHDExistance(false),
+			},
+		},
+	})
+}
+
 func testCheckAzureRMVirtualMachineExists(name string) resource.TestCheckFunc {
 	return func(s *terraform.State) error {
 		// Ensure we have enough information in state to look up in API
@@ -223,6 +267,36 @@ func testCheckAzureRMVirtualMachineDestroy(s *terraform.State) error {
 	return nil
 }
 
+func testCheckAzureRMVirtualMachineOSDiskVHDExistance(shouldExist bool) resource.TestCheckFunc {
+	return func(s *terraform.State) error {
+		for _, rs := range s.RootModule().Resources {
+			if rs.Type != "azurerm_storage_container" {
+				continue
+			}
+
+			// fetch storage account and container name
+			resourceGroup := rs.Primary.Attributes["resource_group_name"]
+			storageAccountName := rs.Primary.Attributes["storage_account_name"]
+			containerName := rs.Primary.Attributes["name"]
+			storageClient, _, err := testAccProvider.Meta().(*ArmClient).getBlobStorageClientForStorageAccount(resourceGroup, storageAccountName)
+			if err != nil {
+				return fmt.Errorf("Error creating Blob storage client: %s", err)
+			}
+
+			exists, err := storageClient.BlobExists(containerName, "myosdisk1.vhd")
+			if err != nil {
+				return fmt.Errorf("Error checking if OS Disk VHD Blob exists: %s", err)
+			}
+
+			if exists && !shouldExist {
+				return fmt.Errorf("OS Disk VHD Blob still exists")
+			}
+		}
+
+		return nil
+	}
+}
+
 var testAccAzureRMVirtualMachine_basicLinuxMachine = `
 resource "azurerm_resource_group" "test" {
     name = "acctestrg-%d"