diff --git a/0001-kms-impl-device-atomic-Add-virtio_gpu-to-deny-list.patch b/0001-kms-impl-device-atomic-Add-virtio_gpu-to-deny-list.patch
new file mode 100644
index 0000000..b240a4d
--- /dev/null
+++ b/0001-kms-impl-device-atomic-Add-virtio_gpu-to-deny-list.patch
@@ -0,0 +1,29 @@
+From 9179d4a4b1708a769d09d0d31d9af5d82240492c Mon Sep 17 00:00:00 2001
+From: =?UTF-8?q?Jonas=20=C3=85dahl?= <jadahl@gmail.com>
+Date: Tue, 5 Oct 2021 15:17:17 +0200
+Subject: [PATCH] kms/impl-device/atomic: Add virtio_gpu to deny list
+
+virtio_gpu is used in virtual machine environments, meaning they need
+accurate cursor hotspots, which currently needs non-atomic mode setting.
+
+Related: https://bugzilla.redhat.com/show_bug.cgi?id=2009304
+Part-of: <https://gitlab.gnome.org/GNOME/mutter/-/merge_requests/2040>
+---
+ src/backends/native/meta-kms-impl-device-atomic.c | 1 +
+ 1 file changed, 1 insertion(+)
+
+diff --git a/src/backends/native/meta-kms-impl-device-atomic.c b/src/backends/native/meta-kms-impl-device-atomic.c
+index 674a24902b..e1adf20b3c 100644
+--- a/src/backends/native/meta-kms-impl-device-atomic.c
++++ b/src/backends/native/meta-kms-impl-device-atomic.c
+@@ -1150,6 +1150,7 @@ is_atomic_allowed (const char *driver_name)
+     "vboxvideo",
+     "nvidia-drm",
+     "tegra",
++    "virtio_gpu",
+     NULL,
+   };
+ 
+-- 
+2.32.0
+
diff --git a/mutter.spec b/mutter.spec
index 83a14f5..1b3fabc 100644
--- a/mutter.spec
+++ b/mutter.spec
@@ -10,7 +10,7 @@
 
 Name:          mutter
 Version:       41.0
-Release:       2%{?dist}
+Release:       3%{?dist}
 Summary:       Window and compositing manager based on Clutter
 
 License:       GPLv2+
@@ -26,6 +26,12 @@ Patch1:        0001-Revert-build-Do-not-provide-built-sources-as-libmutt.patch
 # Workaround for RHBZ#1936991 (blocks atomic KMS on "tegra" driver)
 Patch2:        0001-Test-deny-atomic-KMS-for-tegra-RHBZ-1936991.patch
 
+# Block atomic mode setting on virtio to fix cursor offset
+# manually re-diffed on top of "tegra" patch above
+# https://gitlab.gnome.org/GNOME/mutter/-/merge_requests/2040
+# https://bugzilla.redhat.com/show_bug.cgi?id=2009304
+Patch3:        0001-kms-impl-device-atomic-Add-virtio_gpu-to-deny-list.patch
+
 BuildRequires: pango-devel
 BuildRequires: startup-notification-devel
 BuildRequires: gnome-desktop3-devel
@@ -174,6 +180,9 @@ desktop-file-validate %{buildroot}/%{_datadir}/applications/%{name}.desktop
 %{_datadir}/mutter-%{mutter_api_version}/tests
 
 %changelog
+* Tue Oct 05 2021 Adam Williamson <awilliam@redhat.com> - 41.0-3
+- Backport MR #2040 to fix cursor offset in VMs (#2009304)
+
 * Mon Sep 20 2021 Kalev Lember <klember@redhat.com> - 41.0-2
 - Add missing mesa-libEGL-devel dep to mutter-devel (#2002441)