diff --git a/addons/addon-webgl/src/WebglRenderer.ts b/addons/addon-webgl/src/WebglRenderer.ts
index 83f20c9e7b..79e964aa42 100644
--- a/addons/addon-webgl/src/WebglRenderer.ts
+++ b/addons/addon-webgl/src/WebglRenderer.ts
@@ -623,14 +623,16 @@ export class WebglRenderer extends Disposable implements IRenderer {
     // cell.
     this.dimensions.device.char.height = Math.ceil(this._charSizeService.height * this._devicePixelRatio);
 
-    // Calculate the device cell height, if lineHeight is _not_ 1, the resulting value will be
-    // floored since lineHeight can never be lower then 1, this guarentees the device cell height
-    // will always be larger than device char height.
-    this.dimensions.device.cell.height = Math.floor(this.dimensions.device.char.height * this._optionsService.rawOptions.lineHeight);
+    // Calculate the device cell height. Values >= 8 are treated as absolute pixel heights
+    // (Monaco convention), values < 8 are treated as multipliers of the character height.
+    const lineHeight = this._optionsService.rawOptions.lineHeight;
+    this.dimensions.device.cell.height = lineHeight >= 8
+      ? Math.max(Math.floor(lineHeight * this._devicePixelRatio), this.dimensions.device.char.height)
+      : Math.floor(this.dimensions.device.char.height * lineHeight);
 
     // Calculate the y offset within a cell that glyph should draw at in order for it to be centered
     // correctly within the cell.
-    this.dimensions.device.char.top = this._optionsService.rawOptions.lineHeight === 1 ? 0 : Math.round((this.dimensions.device.cell.height - this.dimensions.device.char.height) / 2);
+    this.dimensions.device.char.top = this.dimensions.device.cell.height === this.dimensions.device.char.height ? 0 : Math.round((this.dimensions.device.cell.height - this.dimensions.device.char.height) / 2);
 
     // Calculate the device cell width, taking the letterSpacing into account.
     this.dimensions.device.cell.width = this.dimensions.device.char.width + Math.round(this._optionsService.rawOptions.letterSpacing);
diff --git a/src/browser/renderer/dom/DomRenderer.ts b/src/browser/renderer/dom/DomRenderer.ts
index 08b5093dfb..e2dfd74f56 100644
--- a/src/browser/renderer/dom/DomRenderer.ts
+++ b/src/browser/renderer/dom/DomRenderer.ts
@@ -136,7 +136,12 @@ export class DomRenderer extends Disposable implements IRenderer {
     this.dimensions.device.char.width = this._charSizeService.width * dpr;
     this.dimensions.device.char.height = Math.ceil(this._charSizeService.height * dpr);
     this.dimensions.device.cell.width = this.dimensions.device.char.width + Math.round(this._optionsService.rawOptions.letterSpacing);
-    this.dimensions.device.cell.height = Math.floor(this.dimensions.device.char.height * this._optionsService.rawOptions.lineHeight);
+    // Values >= 8 are treated as absolute pixel heights (Monaco convention),
+    // values < 8 are treated as multipliers of the character height.
+    const lineHeight = this._optionsService.rawOptions.lineHeight;
+    this.dimensions.device.cell.height = lineHeight >= 8
+      ? Math.max(Math.floor(lineHeight * dpr), this.dimensions.device.char.height)
+      : Math.floor(this.dimensions.device.char.height * lineHeight);
     this.dimensions.device.char.left = 0;
     this.dimensions.device.char.top = 0;
     this.dimensions.device.canvas.width = this.dimensions.device.cell.width * this._bufferService.cols;
diff --git a/src/common/services/OptionsService.test.ts b/src/common/services/OptionsService.test.ts
index 004f731687..832c5a1c7f 100644
--- a/src/common/services/OptionsService.test.ts
+++ b/src/common/services/OptionsService.test.ts
@@ -128,6 +128,36 @@ describe('OptionsService', () => {
       });
     });
   });
+  describe('lineHeight', () => {
+    let service: OptionsService;
+    beforeEach(() => {
+      service = new OptionsService({});
+    });
+    it('should default to 1', () => {
+      assert.strictEqual(service.options.lineHeight, 1);
+    });
+    it('should accept multiplier values (< 8)', () => {
+      service.options.lineHeight = 1.5;
+      assert.strictEqual(service.options.lineHeight, 1.5);
+    });
+    it('should accept pixel values (>= 8)', () => {
+      service.options.lineHeight = 20;
+      assert.strictEqual(service.options.lineHeight, 20);
+    });
+    it('should accept boundary value 8 as pixel height', () => {
+      service.options.lineHeight = 8;
+      assert.strictEqual(service.options.lineHeight, 8);
+    });
+    it('should accept 7.9 as multiplier', () => {
+      service.options.lineHeight = 7.9;
+      assert.strictEqual(service.options.lineHeight, 7.9);
+    });
+    it('should reject values less than 1', () => {
+      assert.throws(() => { service.options.lineHeight = 0.5; });
+      assert.throws(() => { service.options.lineHeight = 0; });
+      assert.throws(() => { service.options.lineHeight = -1; });
+    });
+  });
   describe('onMultipleOptionChange', () => {
     let service: OptionsService;
     beforeEach(() => {
diff --git a/src/common/services/OptionsService.ts b/src/common/services/OptionsService.ts
index ec647aaa50..2ac335f54c 100644
--- a/src/common/services/OptionsService.ts
+++ b/src/common/services/OptionsService.ts
@@ -178,12 +178,18 @@ export class OptionsService extends Disposable implements IOptionsService {
       case 'cursorWidth':
         value = Math.floor(value);
         // Fall through for bounds check
-      case 'lineHeight':
       case 'tabStopWidth':
         if (value < 1) {
           throw new Error(`${key} cannot be less than 1, value: ${value}`);
         }
         break;
+      case 'lineHeight':
+        // Values >= 8 are treated as absolute pixel heights (Monaco convention),
+        // values < 8 are treated as multipliers and must be >= 1.
+        if (value < 1) {
+          throw new Error(`${key} cannot be less than 1, value: ${value}`);
+        }
+        break;
       case 'minimumContrastRatio':
         value = Math.max(1, Math.min(21, Math.round(value * 10) / 10));
         break;
diff --git a/typings/xterm.d.ts b/typings/xterm.d.ts
index c8e08f509f..39b1a96003 100644
--- a/typings/xterm.d.ts
+++ b/typings/xterm.d.ts
@@ -145,7 +145,10 @@ declare module '@xterm/xterm' {
     letterSpacing?: number;
 
     /**
-     * The line height used to render text.
+     * The line height used to render text. When the value is less than 8, it is
+     * treated as a multiplier of the character height (e.g. `1.2`). When the
+     * value is 8 or greater, it is treated as an absolute pixel height. This
+     * follows the same convention as Monaco editor's `lineHeight` option.
      */
     lineHeight?: number;