diff --git a/Lib/distutils/tests/test_msvc9compiler.py b/Lib/distutils/tests/test_msvc9compiler.py
index 69a393c..1264854 100644
--- a/Lib/distutils/tests/test_msvc9compiler.py
+++ b/Lib/distutils/tests/test_msvc9compiler.py
@@ -46,7 +46,7 @@
         # windows registeries versions.
         path = r'Control Panel\Desktop'
         v = Reg.get_value(path, u'dragfullwindows')
-        self.assertTrue(v in (u'0', u'1'))
+        self.assertTrue(v in (u'0', u'1', u'2'))
 
         import _winreg
         HKCU = _winreg.HKEY_CURRENT_USER
diff --git a/Misc/NEWS b/Misc/NEWS
index e1841e8..4616da8 100644
--- a/Misc/NEWS
+++ b/Misc/NEWS
@@ -440,6 +440,9 @@
 Library
 -------
 
+- Issue #7354: distutils.tests.test_msvc9compiler - dragfullwindows can 
+  be 2.
+
 - Issue #5037: Proxy the __unicode__ special method instead to __unicode__
   instead of __str__.