diff --git a/xen/arch/arm/vpl011.c b/xen/arch/arm/vpl011.c
index 0b07436..adf1711 100644
--- a/xen/arch/arm/vpl011.c
+++ b/xen/arch/arm/vpl011.c
@@ -93,24 +93,27 @@ static uint8_t vpl011_read_data(struct domain *d)
      */
     if ( xencons_queued(in_prod, in_cons, sizeof(intf->in)) > 0 )
     {
+        unsigned int fifo_level;
+
         data = intf->in[xencons_mask(in_cons, sizeof(intf->in))];
         in_cons += 1;
         smp_mb();
         intf->in_cons = in_cons;
+
+        fifo_level = xencons_queued(in_prod, in_cons, sizeof(intf->in));
+
+        if ( fifo_level == 0 )
+        {
+            vpl011->uartfr |= RXFE;
+            vpl011->uartris &= ~RXI;
+            vpl011_update_interrupt_status(d);
+        }
     }
     else
         gprintk(XENLOG_ERR, "vpl011: Unexpected IN ring buffer empty\n");
 
-    if ( xencons_queued(in_prod, in_cons, sizeof(intf->in)) == 0 )
-    {
-        vpl011->uartfr |= RXFE;
-        vpl011->uartris &= ~RXI;
-    }
-
     vpl011->uartfr &= ~RXFF;
 
-    vpl011_update_interrupt_status(d);
-
     VPL011_UNLOCK(d, flags);
 
     /*
@@ -122,6 +125,26 @@ static uint8_t vpl011_read_data(struct domain *d)
     return data;
 }
 
+static void vpl011_update_tx_fifo_status(struct vpl011 *vpl011,
+                                         unsigned int fifo_level)
+{
+    struct xencons_interface *intf = vpl011->ring_buf;
+    unsigned int fifo_threshold;
+
+    BUILD_BUG_ON(sizeof (intf->out) < SBSA_UART_FIFO_SIZE);
+
+    /*
+     * Set the TXI bit only when there is space for fifo_size/2 bytes which
+     * is the trigger level for asserting/de-assterting the TX interrupt.
+     */
+    fifo_threshold = sizeof(intf->out) - SBSA_UART_FIFO_SIZE/2;
+
+    if ( fifo_level <= fifo_threshold )
+        vpl011->uartris |= TXI;
+    else
+        vpl011->uartris &= ~TXI;
+}
+
 static void vpl011_write_data(struct domain *d, uint8_t data)
 {
     unsigned long flags;
@@ -146,33 +169,37 @@ static void vpl011_write_data(struct domain *d, uint8_t data)
     if ( xencons_queued(out_prod, out_cons, sizeof(intf->out)) !=
          sizeof (intf->out) )
     {
+        unsigned int fifo_level;
+
         intf->out[xencons_mask(out_prod, sizeof(intf->out))] = data;
         out_prod += 1;
         smp_wmb();
         intf->out_prod = out_prod;
-    }
-    else
-        gprintk(XENLOG_ERR, "vpl011: Unexpected OUT ring buffer full\n");
 
-    if ( xencons_queued(out_prod, out_cons, sizeof(intf->out)) ==
-         sizeof (intf->out) )
-    {
-        vpl011->uartfr |= TXFF;
-        vpl011->uartris &= ~TXI;
+        fifo_level = xencons_queued(out_prod, out_cons, sizeof(intf->out));
 
-        /*
-         * This bit is set only when FIFO becomes full. This ensures that
-         * the SBSA UART driver can write the early console data as fast as
-         * possible, without waiting for the BUSY bit to get cleared before
-         * writing each byte.
-         */
-        vpl011->uartfr |= BUSY;
+        if ( fifo_level == sizeof (intf->out) )
+        {
+            vpl011->uartfr |= TXFF;
+
+            /*
+             * This bit is set only when FIFO becomes full. This ensures that
+             * the SBSA UART driver can write the early console data as fast as
+             * possible, without waiting for the BUSY bit to get cleared before
+             * writing each byte.
+             */
+            vpl011->uartfr |= BUSY;
+        }
+
+        vpl011_update_tx_fifo_status(vpl011, fifo_level);
+
+        vpl011_update_interrupt_status(d);
     }
+    else
+        gprintk(XENLOG_ERR, "vpl011: Unexpected OUT ring buffer full\n");
 
     vpl011->uartfr &= ~TXFE;
 
-    vpl011_update_interrupt_status(d);
-
     VPL011_UNLOCK(d, flags);
 
     /*
@@ -344,7 +371,7 @@ static void vpl011_data_avail(struct domain *d)
     struct vpl011 *vpl011 = &d->arch.vpl011;
     struct xencons_interface *intf = vpl011->ring_buf;
     XENCONS_RING_IDX in_cons, in_prod, out_cons, out_prod;
-    XENCONS_RING_IDX in_ring_qsize, out_ring_qsize;
+    XENCONS_RING_IDX in_fifo_level, out_fifo_level;
 
     VPL011_LOCK(d, flags);
 
@@ -355,28 +382,46 @@ static void vpl011_data_avail(struct domain *d)
 
     smp_rmb();
 
-    in_ring_qsize = xencons_queued(in_prod,
+    in_fifo_level = xencons_queued(in_prod,
                                    in_cons,
                                    sizeof(intf->in));
 
-    out_ring_qsize = xencons_queued(out_prod,
+    out_fifo_level = xencons_queued(out_prod,
                                     out_cons,
                                     sizeof(intf->out));
 
     /* Update the uart rx state if the buffer is not empty. */
-    if ( in_ring_qsize != 0 )
+    if ( in_fifo_level != 0 )
     {
         vpl011->uartfr &= ~RXFE;
-        if ( in_ring_qsize == sizeof(intf->in) )
+
+        if ( in_fifo_level == sizeof(intf->in) )
             vpl011->uartfr |= RXFF;
+
+        /*
+         * Currently, the RXI bit is getting set even if there is a single
+         * byte of data in the rx fifo. Ideally, the RXI bit should be set
+         * only if the rx fifo level reaches the threshold.
+         *
+         * However, since currently RX timeout interrupt is not
+         * implemented as there is not enough clarity in the SBSA spec,
+         * the guest may keep waiting for an interrupt to read more
+         * data. To ensure that guest reads all the data without
+         * any delay, the RXI interrupt is raised if there is RX data
+         * available without checking whether fifo level has reached
+         * the threshold.
+         *
+         * TBD: Once there is more clarity in the SBSA spec on whether RX
+         * timeout interrupt needs to be implemented, the RXI interrupt
+         * will be raised only when rx fifo level reaches the threshold.
+         */
         vpl011->uartris |= RXI;
     }
 
     /* Update the uart tx state if the buffer is not full. */
-    if ( out_ring_qsize != sizeof(intf->out) )
+    if ( out_fifo_level != sizeof(intf->out) )
     {
         vpl011->uartfr &= ~TXFF;
-        vpl011->uartris |= TXI;
 
         /*
          * Clear the BUSY bit as soon as space becomes available
@@ -385,7 +430,9 @@ static void vpl011_data_avail(struct domain *d)
          */
         vpl011->uartfr &= ~BUSY;
 
-        if ( out_ring_qsize == 0 )
+        vpl011_update_tx_fifo_status(vpl011, out_fifo_level);
+
+        if ( out_fifo_level == 0 )
             vpl011->uartfr |= TXFE;
     }
 
diff --git a/xen/include/asm-arm/vpl011.h b/xen/include/asm-arm/vpl011.h
index 1b583da..db95ff8 100644
--- a/xen/include/asm-arm/vpl011.h
+++ b/xen/include/asm-arm/vpl011.h
@@ -28,6 +28,8 @@
 #define VPL011_LOCK(d,flags) spin_lock_irqsave(&(d)->arch.vpl011.lock, flags)
 #define VPL011_UNLOCK(d,flags) spin_unlock_irqrestore(&(d)->arch.vpl011.lock, flags)
 
+#define SBSA_UART_FIFO_SIZE 32
+
 struct vpl011 {
     void *ring_buf;
     struct page_info *ring_page;
