diff --git a/synapse/handlers/room.py b/synapse/handlers/room.py
index 7062414adf..d5c56ce0d6 100644
--- a/synapse/handlers/room.py
+++ b/synapse/handlers/room.py
@@ -119,7 +119,8 @@ class RoomCreationHandler(BaseHandler):
 
         invite_3pid_list = config.get("invite_3pid", [])
 
-        is_public = config.get("visibility", None) == "public"
+        visibility = config.get("visibility", None)
+        is_public = visibility == "public"
 
         # autogen room IDs and try to create it. We may clash, so just
         # try a few times till one goes through, giving up eventually.
@@ -155,9 +156,9 @@ class RoomCreationHandler(BaseHandler):
 
         preset_config = config.get(
             "preset",
-            RoomCreationPreset.PUBLIC_CHAT
-            if is_public
-            else RoomCreationPreset.PRIVATE_CHAT
+            RoomCreationPreset.PRIVATE_CHAT
+            if visibility == "private"
+            else RoomCreationPreset.PUBLIC_CHAT
         )
 
         raw_initial_state = config.get("initial_state", [])
diff --git a/synapse/storage/schema/delta/30/public_rooms.sql b/synapse/storage/schema/delta/30/public_rooms.sql
new file mode 100644
index 0000000000..a48604faa8
--- /dev/null
+++ b/synapse/storage/schema/delta/30/public_rooms.sql
@@ -0,0 +1,21 @@
+/* Copyright 2016 OpenMarket Ltd
+ *
+ * Licensed under the Apache License, Version 2.0 (the "License");
+ * you may not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *    http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing, software
+ * distributed under the License is distributed on an "AS IS" BASIS,
+ * WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+ * See the License for the specific language governing permissions and
+ * limitations under the License.
+ */
+
+
+/* This release removes the restriction that published rooms must have an alias,
+ * so we go back and ensure the only 'public' rooms are ones with an alias.*/
+UPDATE rooms SET is_public = 0 WHERE is_public = 1 AND room_id not in (
+    SELECT room_id FROM room_aliases
+);