diff --git a/CHANGELOG.md b/CHANGELOG.md
index e8fe184a8ee1c..6f10331a02eba 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -4,6 +4,11 @@
 
 - [Previous Changelogs](https://github.com/eclipse-theia/theia/tree/master/doc/changelogs/)
 
+## v1.34.0 - 01/26/2023
+
+- [plugin] added support for `isTransient` of `TerminalOptions` and `ExternalTerminalOptions` VS Code API [#12055](https://github.com/eclipse-theia/theia/pull/12055) - Contributed on behalf of STMicroelectronics
+- [terminal] added support for preference `terminal.integrated.enablePersistentSessions` to allow disabling restoring terminals on reload [#12055](https://github.com/eclipse-theia/theia/pull/12055) - Contributed on behalf of STMicroelectronics
+
 ## v1.33.0 - 12/20/2022
 
 - [application-package] added support for declaring extensions as peer dependencies [#11808](https://github.com/eclipse-theia/theia/pull/11808)
diff --git a/packages/plugin-ext/src/main/browser/terminal-main.ts b/packages/plugin-ext/src/main/browser/terminal-main.ts
index 54e2edf88453d..435fd1e684b34 100644
--- a/packages/plugin-ext/src/main/browser/terminal-main.ts
+++ b/packages/plugin-ext/src/main/browser/terminal-main.ts
@@ -137,7 +137,8 @@ export class TerminalServiceMainImpl implements TerminalServiceMain, TerminalLin
                 attributes: options.attributes,
                 hideFromUser: options.hideFromUser,
                 location: this.getTerminalLocation(options, parentId),
-                isPseudoTerminal
+                isPseudoTerminal,
+                isTransient: options.isTransient
             });
             if (options.message) {
                 terminal.writeLine(options.message);
diff --git a/packages/plugin/src/theia.d.ts b/packages/plugin/src/theia.d.ts
index 12ac09beb6562..cbe6d3c1ca307 100644
--- a/packages/plugin/src/theia.d.ts
+++ b/packages/plugin/src/theia.d.ts
@@ -3006,6 +3006,12 @@ export module '@theia/plugin' {
          */
         location?: TerminalLocation | TerminalEditorLocationOptions | TerminalSplitLocationOptions;
 
+        /**
+         * Opt-out of the default terminal persistence on restart and reload.
+         * This will only take effect when `terminal.integrated.enablePersistentSessions` is enabled.
+         */
+        isTransient?: boolean;
+
         /**
          * Terminal attributes. Can be useful to apply some implementation specific information.
          */
@@ -3077,6 +3083,12 @@ export module '@theia/plugin' {
          * The {@link TerminalLocation} or {@link TerminalEditorLocationOptions} or {@link TerminalSplitLocationOptions} for the terminal.
          */
         location?: TerminalLocation | TerminalEditorLocationOptions | TerminalSplitLocationOptions;
+
+        /**
+         * Opt-out of the default terminal persistence on restart and reload.
+         * This will only take effect when `terminal.integrated.enablePersistentSessions` is enabled.
+         */
+        isTransient?: boolean;
     }
 
     /**
diff --git a/packages/terminal/src/browser/base/terminal-widget.ts b/packages/terminal/src/browser/base/terminal-widget.ts
index e355f8312e6ae..1cbcc1351ff9f 100644
--- a/packages/terminal/src/browser/base/terminal-widget.ts
+++ b/packages/terminal/src/browser/base/terminal-widget.ts
@@ -231,4 +231,9 @@ export interface TerminalWidgetOptions {
     readonly hideFromUser?: boolean;
 
     readonly location?: TerminalLocationOptions;
+
+    /**
+     * When enabled, the terminal will not be persisted across window reloads.
+     */
+    readonly isTransient?: boolean;
 }
diff --git a/packages/terminal/src/browser/terminal-preferences.ts b/packages/terminal/src/browser/terminal-preferences.ts
index 48913d1676a8b..f1baaf31b83bb 100644
--- a/packages/terminal/src/browser/terminal-preferences.ts
+++ b/packages/terminal/src/browser/terminal-preferences.ts
@@ -153,6 +153,11 @@ export const TerminalConfigSchema: PreferenceSchema = {
                 nls.localize('theia/terminal/confirmCloseChildren', 'Confirm if there are any terminals that have child processes.'),
             ],
             default: 'never'
+        },
+        'terminal.integrated.enablePersistentSessions': {
+            type: 'boolean',
+            description: nls.localizeByDefault('Persist terminal sessions for the workspace across window reloads.'),
+            default: true
         }
     }
 };
@@ -181,7 +186,8 @@ export interface TerminalConfiguration {
     'terminal.integrated.shellArgs.windows': string[],
     'terminal.integrated.shellArgs.osx': string[],
     'terminal.integrated.shellArgs.linux': string[],
-    'terminal.integrated.confirmOnExit': ConfirmOnExitType
+    'terminal.integrated.confirmOnExit': ConfirmOnExitType,
+    'terminal.integrated.enablePersistentSessions': boolean
 }
 
 type FontWeight = 'normal' | 'bold' | '100' | '200' | '300' | '400' | '500' | '600' | '700' | '800' | '900';
diff --git a/packages/terminal/src/browser/terminal-widget-impl.ts b/packages/terminal/src/browser/terminal-widget-impl.ts
index b05ffe8dad995..937e89cddacc5 100644
--- a/packages/terminal/src/browser/terminal-widget-impl.ts
+++ b/packages/terminal/src/browser/terminal-widget-impl.ts
@@ -407,6 +407,11 @@ export class TerminalWidgetImpl extends TerminalWidget implements StatefulWidget
         return this.options.hideFromUser ?? false;
     }
 
+    get transient(): boolean {
+        // The terminal is transient if session persistence is disabled or it's explicitly marked as transient
+        return !this.preferences['terminal.integrated.enablePersistentSessions'] || !!this.options.isTransient;
+    }
+
     onDispose(onDispose: () => void): void {
         this.toDispose.push(Disposable.create(onDispose));
     }
@@ -421,15 +426,15 @@ export class TerminalWidgetImpl extends TerminalWidget implements StatefulWidget
 
     storeState(): object {
         this.closeOnDispose = false;
-        if (this.options.isPseudoTerminal) {
+        if (this.transient || this.options.isPseudoTerminal) {
             return {};
         }
         return { terminalId: this.terminalId, titleLabel: this.title.label };
     }
 
     restoreState(oldState: object): void {
-        // pseudo terminal can not restore
-        if (this.options.isPseudoTerminal) {
+        // transient terminals and pseudo terminals are not restored
+        if (this.transient || this.options.isPseudoTerminal) {
             this.dispose();
             return;
         }