diff --git a/src/components/structures/MessagePanel.js b/src/components/structures/MessagePanel.js
index 5a11ce8ab9..698768067a 100644
--- a/src/components/structures/MessagePanel.js
+++ b/src/components/structures/MessagePanel.js
@@ -54,6 +54,10 @@ module.exports = React.createClass({
         // ID of an event to highlight. If undefined, no event will be highlighted.
         highlightedEventId: PropTypes.string,
 
+        // The room these events are all in together, if any.
+        // (The notification panel won't have a room here, for example.)
+        room: PropTypes.object,
+
         // Should we show URL Previews
         showUrlPreview: PropTypes.bool,
 
@@ -117,10 +121,48 @@ module.exports = React.createClass({
         // to manage its animations
         this._readReceiptMap = {};
 
+        // Track read receipts by event ID. For each _shown_ event ID, we store
+        // the list of read receipts to display:
+        //   [
+        //       {
+        //           userId: string,
+        //           member: RoomMember,
+        //           ts: number,
+        //       },
+        //   ]
+        // This is recomputed on each render. It's only stored on the component
+        // for ease of passing the data around since it's computed in one pass
+        // over all events.
+        this._readReceiptsByEvent = {};
+
+        // Track read receipts by user ID. For each user ID we've ever shown a
+        // a read receipt for, we store an object:
+        //   {
+        //       lastShownEventId: string,
+        //       receipt: {
+        //           userId: string,
+        //           member: RoomMember,
+        //           ts: number,
+        //       },
+        //   }
+        // so that we can always keep receipts displayed by reverting back to
+        // the last shown event for that user ID when needed. This may feel like
+        // it duplicates the receipt storage in the room, but at this layer, we
+        // are tracking _shown_ event IDs, which the JS SDK knows nothing about.
+        // This is recomputed on each render, using the data from the previous
+        // render as our fallback for any user IDs we can't match a receipt to a
+        // displayed event in the current render cycle.
+        this._readReceiptsByUserId = {};
+
         // Remember the read marker ghost node so we can do the cleanup that
         // Velocity requires
         this._readMarkerGhostNode = null;
 
+        // Cache hidden events setting on mount since Settings is expensive to
+        // query, and we check this in a hot code path.
+        this._showHiddenEventsInTimeline =
+            SettingsStore.getValue("showHiddenEventsInTimeline");
+
         this._isMounted = true;
     },
 
@@ -261,7 +303,7 @@ module.exports = React.createClass({
             return false; // ignored = no show (only happens if the ignore happens after an event was received)
         }
 
-        if (SettingsStore.getValue("showHiddenEventsInTimeline")) {
+        if (this._showHiddenEventsInTimeline) {
             return true;
         }
 
@@ -327,6 +369,11 @@ module.exports = React.createClass({
             this.currentGhostEventId = null;
         }
 
+        this._readReceiptsByEvent = {};
+        if (this.props.showReadReceipts) {
+            this._readReceiptsByEvent = this._getReadReceiptsByShownEvent();
+        }
+
         const isMembershipChange = (e) => e.getType() === 'm.room.member';
 
         for (i = 0; i < this.props.events.length; i++) {
@@ -527,10 +574,8 @@ module.exports = React.createClass({
         // Local echos have a send "status".
         const scrollToken = mxEv.status ? undefined : eventId;
 
-        let readReceipts;
-        if (this.props.showReadReceipts) {
-            readReceipts = this._getReadReceiptsForEvent(mxEv);
-        }
+        const readReceipts = this._readReceiptsByEvent[eventId];
+
         ret.push(
             <li key={eventId}
                 ref={this._collectEventNode.bind(this, eventId)}
@@ -570,13 +615,13 @@ module.exports = React.createClass({
         return wantsDateSeparator(prevEvent.getDate(), nextEventDate);
     },
 
-    // get a list of read receipts that should be shown next to this event
+    // Get a list of read receipts that should be shown next to this event
     // Receipts are objects which have a 'userId', 'roomMember' and 'ts'.
     _getReadReceiptsForEvent: function(event) {
         const myUserId = MatrixClientPeg.get().credentials.userId;
 
         // get list of read receipts, sorted most recent first
-        const room = MatrixClientPeg.get().getRoom(event.getRoomId());
+        const { room } = this.props;
         if (!room) {
             return null;
         }
@@ -595,10 +640,65 @@ module.exports = React.createClass({
                 ts: r.data ? r.data.ts : 0,
             });
         });
+        return receipts;
+    },
 
-        return receipts.sort((r1, r2) => {
-            return r2.ts - r1.ts;
-        });
+    // Get an object that maps from event ID to a list of read receipts that
+    // should be shown next to that event. If a hidden event has read receipts,
+    // they are folded into the receipts of the last shown event.
+    _getReadReceiptsByShownEvent: function() {
+        const receiptsByEvent = {};
+        const receiptsByUserId = {};
+
+        let lastShownEventId;
+        for (const event of this.props.events) {
+            if (this._shouldShowEvent(event)) {
+                lastShownEventId = event.getId();
+            }
+            if (!lastShownEventId) {
+                continue;
+            }
+
+            const existingReceipts = receiptsByEvent[lastShownEventId] || [];
+            const newReceipts = this._getReadReceiptsForEvent(event);
+            receiptsByEvent[lastShownEventId] = existingReceipts.concat(newReceipts);
+
+            // Record these receipts along with their last shown event ID for
+            // each associated user ID.
+            for (const receipt of newReceipts) {
+                receiptsByUserId[receipt.userId] = {
+                    lastShownEventId,
+                    receipt,
+                };
+            }
+        }
+
+        // It's possible in some cases (for example, when a read receipt
+        // advances before we have paginated in the new event that it's marking
+        // received) that we can temporarily not have a matching event for
+        // someone which had one in the last. By looking through our previous
+        // mapping of receipts by user ID, we can cover recover any receipts
+        // that would have been lost by using the same event ID from last time.
+        for (const userId in this._readReceiptsByUserId) {
+            if (receiptsByUserId[userId]) {
+                continue;
+            }
+            const { lastShownEventId, receipt } = this._readReceiptsByUserId[userId];
+            const existingReceipts = receiptsByEvent[lastShownEventId] || [];
+            receiptsByEvent[lastShownEventId] = existingReceipts.concat(receipt);
+            receiptsByUserId[userId] = { lastShownEventId, receipt };
+        }
+        this._readReceiptsByUserId = receiptsByUserId;
+
+        // After grouping receipts by shown events, do another pass to sort each
+        // receipt list.
+        for (const eventId in receiptsByEvent) {
+            receiptsByEvent[eventId].sort((r1, r2) => {
+                return r2.ts - r1.ts;
+            });
+        }
+
+        return receiptsByEvent;
     },
 
     _getReadMarkerTile: function(visible) {