diff --git a/package.json b/package.json
index f817969f87f..ca54f290558 100644
--- a/package.json
+++ b/package.json
@@ -52,7 +52,7 @@
     "vscode-ripgrep": "^1.5.7",
     "vscode-sqlite3": "4.0.8",
     "vscode-textmate": "^4.2.2",
-    "xterm": "4.0.0",
+    "xterm": "4.1.0-beta8",
     "xterm-addon-search": "0.2.0",
     "xterm-addon-web-links": "0.2.0",
     "yauzl": "^2.9.2",
@@ -153,4 +153,4 @@
     "windows-mutex": "0.3.0",
     "windows-process-tree": "0.2.4"
   }
-}
\ No newline at end of file
+}
diff --git a/remote/package.json b/remote/package.json
index 4c37100ec67..10c377499f1 100644
--- a/remote/package.json
+++ b/remote/package.json
@@ -21,7 +21,7 @@
     "vscode-proxy-agent": "0.4.0",
     "vscode-ripgrep": "^1.5.7",
     "vscode-textmate": "^4.2.2",
-    "xterm": "4.0.0",
+    "xterm": "4.1.0-beta8",
     "xterm-addon-search": "0.2.0",
     "xterm-addon-web-links": "0.2.0",
     "yauzl": "^2.9.2",
diff --git a/remote/web/package.json b/remote/web/package.json
index d488944039d..ab86c010ead 100644
--- a/remote/web/package.json
+++ b/remote/web/package.json
@@ -6,7 +6,7 @@
 		"onigasm-umd": "^2.2.2",
 		"semver-umd": "^5.5.3",
 		"vscode-textmate": "^4.2.2",
-		"xterm": "4.0.0",
+		"xterm": "4.1.0-beta8",
 		"xterm-addon-search": "0.2.0",
 		"xterm-addon-web-links": "0.2.0"
 	}
diff --git a/remote/web/yarn.lock b/remote/web/yarn.lock
index 7b0ddab9d16..ccc09170f6f 100644
--- a/remote/web/yarn.lock
+++ b/remote/web/yarn.lock
@@ -109,7 +109,7 @@ xterm-addon-web-links@0.2.0:
   resolved "https://registry.yarnpkg.com/xterm-addon-web-links/-/xterm-addon-web-links-0.2.0.tgz#b408a0be46211d8d4a0bb5e701d8f3c2bd07d473"
   integrity sha512-dq81c4Pzli2PgKVBgY2REte9sCVibR3df8AP3SEvCTM9uYFnUFxtxzMTplPnc7+rXabVhFdbU6x+rstIk8HNQg==
 
-xterm@4.0.0:
-  version "4.0.0"
-  resolved "https://registry.yarnpkg.com/xterm/-/xterm-4.0.0.tgz#eac93e08cbe69cf238cbace9185ed9e38873df1a"
-  integrity sha512-Xbx3vvf9FnrUcI1qU31Jww7/fc/NqpXGqgByTvjj7+g3/yPvt/RvLkP/LLMcof2kLAC3evzZGMiovs7NkjdWDw==
+xterm@4.1.0-beta8:
+  version "4.1.0-beta8"
+  resolved "https://registry.yarnpkg.com/xterm/-/xterm-4.1.0-beta8.tgz#c1ef323ba336d92f5b52302b66f672dfff75b3ef"
+  integrity sha512-6lf+XVv0qT285w49P92tSYoUB406jdbgdhnPKNzxCIGtGX8kcwK+pHZ8HncDwcEhmTmI4LZ/WXPGtOQJg+onwg==
diff --git a/remote/yarn.lock b/remote/yarn.lock
index 037aedc8cfd..052c1fa7847 100644
--- a/remote/yarn.lock
+++ b/remote/yarn.lock
@@ -489,10 +489,10 @@ xterm-addon-web-links@0.2.0:
   resolved "https://registry.yarnpkg.com/xterm-addon-web-links/-/xterm-addon-web-links-0.2.0.tgz#b408a0be46211d8d4a0bb5e701d8f3c2bd07d473"
   integrity sha512-dq81c4Pzli2PgKVBgY2REte9sCVibR3df8AP3SEvCTM9uYFnUFxtxzMTplPnc7+rXabVhFdbU6x+rstIk8HNQg==
 
-xterm@4.0.0:
-  version "4.0.0"
-  resolved "https://registry.yarnpkg.com/xterm/-/xterm-4.0.0.tgz#eac93e08cbe69cf238cbace9185ed9e38873df1a"
-  integrity sha512-Xbx3vvf9FnrUcI1qU31Jww7/fc/NqpXGqgByTvjj7+g3/yPvt/RvLkP/LLMcof2kLAC3evzZGMiovs7NkjdWDw==
+xterm@4.1.0-beta8:
+  version "4.1.0-beta8"
+  resolved "https://registry.yarnpkg.com/xterm/-/xterm-4.1.0-beta8.tgz#c1ef323ba336d92f5b52302b66f672dfff75b3ef"
+  integrity sha512-6lf+XVv0qT285w49P92tSYoUB406jdbgdhnPKNzxCIGtGX8kcwK+pHZ8HncDwcEhmTmI4LZ/WXPGtOQJg+onwg==
 
 yauzl@^2.9.2:
   version "2.10.0"
diff --git a/src/typings/xterm.d.ts b/src/typings/xterm.d.ts
index 695f872bcd5..e7b8a156283 100644
--- a/src/typings/xterm.d.ts
+++ b/src/typings/xterm.d.ts
@@ -650,24 +650,32 @@ declare module 'xterm' {
 		clear(): void;
 
 		/**
-		 * Writes text to the terminal.
-		 * @param data The text to write to the terminal.
+		 * Write data to the terminal.
+		 * @param data The data to write to the terminal. This can either be raw
+		 * bytes given as Uint8Array from the pty or a string. Raw bytes will always
+		 * be treated as UTF-8 encoded, string data as UTF-16.
+		 * @param callback Optional callback that fires when the data was processed
+		 * by the parser.
 		 */
-		write(data: string): void;
+		write(data: string | Uint8Array, callback?: () => void): void;
 
 		/**
-		 * Writes text to the terminal, followed by a break line character (\n).
-		 * @param data The text to write to the terminal.
+		 * Writes data to the terminal, followed by a break line character (\n).
+		 * @param data The data to write to the terminal. This can either be raw
+		 * bytes given as Uint8Array from the pty or a string. Raw bytes will always
+		 * be treated as UTF-8 encoded, string data as UTF-16.
+		 * @param callback Optional callback that fires when the data was processed
+		 * by the parser.
 		 */
-		writeln(data: string): void;
+		writeln(data: string | Uint8Array, callback?: () => void): void;
 
 		/**
-		 * Writes UTF8 data to the terminal. This has a slight performance advantage
-		 * over the string based write method due to lesser data conversions needed
-		 * on the way from the pty to xterm.js.
+		 * Write UTF8 data to the terminal.
 		 * @param data The data to write to the terminal.
+		 * @param callback Optional callback when data was processed.
+		 * @deprecated use `write` instead
 		 */
-		writeUtf8(data: Uint8Array): void;
+		writeUtf8(data: Uint8Array, callback?: () => void): void;
 
 		/**
 		 * Writes text to the terminal, performing the necessary transformations for pasted text.
@@ -804,7 +812,7 @@ declare module 'xterm' {
 	 */
 	export interface ITerminalAddon extends IDisposable {
 		/**
-		 * (EXPERIMENTAL) This is called when the addon is activated.
+		 * This is called when the addon is activated.
 		 */
 		activate(terminal: Terminal): void;
 	}
diff --git a/yarn.lock b/yarn.lock
index d71018e8ee6..a234c0630cb 100644
--- a/yarn.lock
+++ b/yarn.lock
@@ -9312,10 +9312,10 @@ xterm-addon-web-links@0.2.0:
   resolved "https://registry.yarnpkg.com/xterm-addon-web-links/-/xterm-addon-web-links-0.2.0.tgz#b408a0be46211d8d4a0bb5e701d8f3c2bd07d473"
   integrity sha512-dq81c4Pzli2PgKVBgY2REte9sCVibR3df8AP3SEvCTM9uYFnUFxtxzMTplPnc7+rXabVhFdbU6x+rstIk8HNQg==
 
-xterm@4.0.0:
-  version "4.0.0"
-  resolved "https://registry.yarnpkg.com/xterm/-/xterm-4.0.0.tgz#eac93e08cbe69cf238cbace9185ed9e38873df1a"
-  integrity sha512-Xbx3vvf9FnrUcI1qU31Jww7/fc/NqpXGqgByTvjj7+g3/yPvt/RvLkP/LLMcof2kLAC3evzZGMiovs7NkjdWDw==
+xterm@4.1.0-beta8:
+  version "4.1.0-beta8"
+  resolved "https://registry.yarnpkg.com/xterm/-/xterm-4.1.0-beta8.tgz#c1ef323ba336d92f5b52302b66f672dfff75b3ef"
+  integrity sha512-6lf+XVv0qT285w49P92tSYoUB406jdbgdhnPKNzxCIGtGX8kcwK+pHZ8HncDwcEhmTmI4LZ/WXPGtOQJg+onwg==
 
 y18n@^3.2.1:
   version "3.2.1"