diff --git a/CHANGELOG.md b/CHANGELOG.md
index 5937f07aed..6ef11803c2 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -1,6 +1,9 @@
 # Changelog
 All changes to the project will be documented in this file.
 
+## [1.34.1] - not yet released
+* Fixed a regression introduced in 1.32.20 which caused `AllowUnsafeCode` in csproj to also enable `TreatWarningsAsErrors` behavior ([#1565](https://github.com/OmniSharp/omnisharp-roslyn/issues/1565), PR: [#1567](https://github.com/OmniSharp/omnisharp-roslyn/pull/1567))
+
 ## [1.34.0] - 2019-07-15
 * Added support for Roslyn code actions that normally need UI - they used to be explicitly sipped by OmniSharp, now it surfaces them with predefined defaults instead. ([#1220](https://github.com/OmniSharp/omnisharp-roslyn/issues/1220), PR: [#1406](https://github.com/OmniSharp/omnisharp-roslyn/pull/1406)) These are:
   * extract interface
diff --git a/src/OmniSharp.MSBuild/ProjectFile/ProjectFileInfoExtensions.cs b/src/OmniSharp.MSBuild/ProjectFile/ProjectFileInfoExtensions.cs
index 69b76345ad..fd61c17442 100644
--- a/src/OmniSharp.MSBuild/ProjectFile/ProjectFileInfoExtensions.cs
+++ b/src/OmniSharp.MSBuild/ProjectFile/ProjectFileInfoExtensions.cs
@@ -21,7 +21,7 @@ public static CSharpCompilationOptions CreateCompilationOptions(this ProjectFile
 
             if (projectFileInfo.AllowUnsafeCode)
             {
-                compilationOptions = compilationOptions.WithAllowUnsafe(true).WithGeneralDiagnosticOption(ReportDiagnostic.Error);
+                compilationOptions = compilationOptions.WithAllowUnsafe(true);
             }
 
             if (projectFileInfo.TreatWarningsAsErrors)
diff --git a/test-assets/test-projects/AllowUnsafe/AllowUnsafe.csproj b/test-assets/test-projects/AllowUnsafe/AllowUnsafe.csproj
new file mode 100644
index 0000000000..7ed1b0f016
--- /dev/null
+++ b/test-assets/test-projects/AllowUnsafe/AllowUnsafe.csproj
@@ -0,0 +1,9 @@
+<Project Sdk="Microsoft.NET.Sdk">
+
+  <PropertyGroup>
+    <OutputType>Exe</OutputType>
+    <TargetFramework>netcoreapp2.1</TargetFramework>
+    <AllowUnsafeBlocks>true</AllowUnsafeBlocks>
+  </PropertyGroup>
+
+</Project>
\ No newline at end of file
diff --git a/test-assets/test-projects/AllowUnsafe/Program.cs b/test-assets/test-projects/AllowUnsafe/Program.cs
new file mode 100644
index 0000000000..714bb23a60
--- /dev/null
+++ b/test-assets/test-projects/AllowUnsafe/Program.cs
@@ -0,0 +1,12 @@
+using System;
+
+namespace ConsoleApplication
+{
+    public class Program
+    {
+        public static unsafe void Main(string[] args)
+        {
+            Console.WriteLine("Hello World!");
+        }
+    }
+}
\ No newline at end of file
diff --git a/tests/OmniSharp.MSBuild.Tests/ProjectFileInfoTests.cs b/tests/OmniSharp.MSBuild.Tests/ProjectFileInfoTests.cs
index ed0b3a972c..7baf050945 100644
--- a/tests/OmniSharp.MSBuild.Tests/ProjectFileInfoTests.cs
+++ b/tests/OmniSharp.MSBuild.Tests/ProjectFileInfoTests.cs
@@ -155,5 +155,21 @@ public async Task ExternAlias()
                 Assert.Equal("abc", projectFileInfo.ReferenceAliases[libpath]);
             }
         }
+
+        [Fact]
+        public async Task AllowUnsafe()
+        {
+            using (var host = CreateOmniSharpHost())
+            using (var testProject = await _testAssets.GetTestProjectAsync("AllowUnsafe"))
+            {
+                var projectFilePath = Path.Combine(testProject.Directory, "AllowUnsafe.csproj");
+                var projectFileInfo = CreateProjectFileInfo(host, testProject, projectFilePath);
+                Assert.True(projectFileInfo.AllowUnsafeCode);
+
+                var compilationOptions = projectFileInfo.CreateCompilationOptions();
+                Assert.True(compilationOptions.AllowUnsafe);
+                Assert.Equal(ReportDiagnostic.Default, compilationOptions.GeneralDiagnosticOption);
+            }
+        }
     }
 }