diff --git a/Source/cursor.cpp b/Source/cursor.cpp
index 6f20233e9..c5af4f927 100644
--- a/Source/cursor.cpp
+++ b/Source/cursor.cpp
@@ -297,9 +297,8 @@ void DrawSoftwareCursor(const Surface &out, Point position, int cursId)
 	const ClxSprite sprite = GetInvItemSprite(cursId);
 	if (!MyPlayer->HoldItem.isEmpty()) {
 		const auto &heldItem = MyPlayer->HoldItem;
-		Size cursSize = GetInvItemSize(cursId);
-		ClxDrawOutline(out, GetOutlineColor(heldItem, true), position - Displacement(cursSize / 2), sprite);
-		DrawItem(heldItem, out, position - Displacement(cursSize / 2), sprite);
+		ClxDrawOutline(out, GetOutlineColor(heldItem, true), position, sprite);
+		DrawItem(heldItem, out, position, sprite);
 	} else {
 		ClxDraw(out, position, sprite);
 	}
diff --git a/Source/inv.cpp b/Source/inv.cpp
index 3a52b2366..8350fc7aa 100644
--- a/Source/inv.cpp
+++ b/Source/inv.cpp
@@ -320,9 +320,8 @@ int FindSlotUnderCursor(Point cursorPosition, Size itemSize)
 void CheckInvPaste(Player &player, Point cursorPosition)
 {
 	Size itemSize = GetInventorySize(player.HoldItem);
-	Size cursSize = GetInvItemSize(player.HoldItem._iCurs);
 
-	int slot = FindSlotUnderCursor(cursorPosition - Displacement(cursSize / 2), itemSize);
+	int slot = FindSlotUnderCursor(cursorPosition, itemSize);
 	if (slot == NUM_XY_SLOTS)
 		return;
 
@@ -555,6 +554,8 @@ void CheckInvPaste(Player &player, Point cursorPosition)
 	}
 	CalcPlrInv(player, true);
 	if (&player == MyPlayer) {
+		if (player.HoldItem.isEmpty() && !IsHardwareCursor())
+			SetCursorPos(MousePosition + Displacement { itemSize * INV_SLOT_HALF_SIZE_PX });
 		NewCursor(player.HoldItem);
 	}
 }
@@ -818,6 +819,11 @@ void CheckInvCut(Player &player, Point cursorPosition, bool automaticMove, bool
 				holdItem.clear();
 			} else {
 				NewCursor(holdItem);
+				if (!IsHardwareCursor() && !dropItem) {
+					// For a hardware cursor, we set the "hot point" to the center of the item instead.
+					Size cursSize = GetInvItemSize(holdItem._iCurs + CURSOR_FIRSTITEM);
+					SetCursorPos(cursorPosition - Displacement(cursSize / 2));
+				}
 			}
 		}
 	}