diff --git a/apps/openmw/mwrender/renderingmanager.cpp b/apps/openmw/mwrender/renderingmanager.cpp
index 8ee292de1..b739a9f95 100644
--- a/apps/openmw/mwrender/renderingmanager.cpp
+++ b/apps/openmw/mwrender/renderingmanager.cpp
@@ -109,10 +109,13 @@ RenderingManager::RenderingManager(OEngine::Render::OgreRenderer& _rend, const b
 
     mFactory->loadAllFiles();
 
-    // Set default mipmap level (NB some APIs ignore this)
-    // Mipmap generation is currently disabled because it causes issues on Intel/AMD
-    //TextureManager::getSingleton().setDefaultNumMipmaps(Settings::Manager::getInt("num mipmaps", "General"));
+    // Compressed textures with 0 mip maps are bugged in 1.8, so disable mipmap generator in that case
+    // ( https://ogre3d.atlassian.net/browse/OGRE-259 )
+#if OGRE_VERSION >= (1 << 16 | 9 << 8 | 0)
+    TextureManager::getSingleton().setDefaultNumMipmaps(Settings::Manager::getInt("num mipmaps", "General"));
+#else
     TextureManager::getSingleton().setDefaultNumMipmaps(0);
+#endif
 
     // Set default texture filtering options
     TextureFilterOptions tfo;
diff --git a/files/materials/water.mat b/files/materials/water.mat
index 1e5f8c8e0..ade55f326 100644
--- a/files/materials/water.mat
+++ b/files/materials/water.mat
@@ -37,7 +37,7 @@ material Water
         
         texture_unit normalMap
         {
-            texture water_nm.png 5
+            texture water_nm.png
         }
 
         texture_unit rippleNormalMap
diff --git a/files/settings-default.cfg b/files/settings-default.cfg
index 2ca59159b..22391fe93 100644
--- a/files/settings-default.cfg
+++ b/files/settings-default.cfg
@@ -53,8 +53,7 @@ texture filtering = anisotropic
 anisotropy = 4
 
 # Number of texture mipmaps to generate
-# This setting is currently ignored due to mipmap generation problems on Intel/AMD
-#num mipmaps = 5
+num mipmaps = 8
 
 shader mode =