diff --git a/src/components/autocomplete/autocomplete.scss b/src/components/autocomplete/autocomplete.scss
index 04c1dc9d601..fe908b624ed 100644
--- a/src/components/autocomplete/autocomplete.scss
+++ b/src/components/autocomplete/autocomplete.scss
@@ -201,6 +201,10 @@ md-autocomplete {
   z-index: $z-index-tooltip;
 }
 
+.md-virtual-repeat-container.md-not-found {
+  height: 48px;
+}
+
 .md-autocomplete-suggestions {
   margin: 0;
   list-style: none;
diff --git a/src/components/autocomplete/js/autocompleteDirective.js b/src/components/autocomplete/js/autocompleteDirective.js
index bd7233b5def..7d60117cc2b 100644
--- a/src/components/autocomplete/js/autocompleteDirective.js
+++ b/src/components/autocomplete/js/autocompleteDirective.js
@@ -178,6 +178,7 @@ function MdAutocomplete () {
               ng-mouseup="$mdAutocompleteCtrl.mouseUp()"\
               ng-hide="$mdAutocompleteCtrl.hidden"\
               class="md-autocomplete-suggestions-container md-whiteframe-z1"\
+              ng-class="{ \'md-not-found\': $mdAutocompleteCtrl.notFoundVisible() }"\
               role="presentation">\
             <ul class="md-autocomplete-suggestions"\
                 ng-class="::menuClass"\