diff --git a/dll/win32/shell32/folders/CFSFolder.cpp b/dll/win32/shell32/folders/CFSFolder.cpp
index 95ba3b95f6c..93cacdd1e2f 100644
--- a/dll/win32/shell32/folders/CFSFolder.cpp
+++ b/dll/win32/shell32/folders/CFSFolder.cpp
@@ -307,7 +307,7 @@ HRESULT CFSExtractIcon_CreateInstance(IShellFolder * psf, LPCITEMIDLIST pidl, RE
                 ILGetDisplayNameExW(psf, pidl, wTemp, ILGDN_FORPARSING);
                 icon_idx = 0;
 
-                INT ret = ExtractIconExW(wTemp, -1, NULL, NULL, 0);
+                INT ret = PrivateExtractIconsW(wTemp, 0, 0, 0, NULL, NULL, 0, 0);
                 if (ret <= 0)
                 {
                     StringCbCopyW(wTemp, sizeof(wTemp), swShell32Name);
diff --git a/win32ss/user/user32/misc/exticon.c b/win32ss/user/user32/misc/exticon.c
index 33f8f19b15f..00e9357987b 100644
--- a/win32ss/user/user32/misc/exticon.c
+++ b/win32ss/user/user32/misc/exticon.c
@@ -283,7 +283,12 @@ static UINT ICO_ExtractIconExW(
 	UINT cxDesired,
 	UINT cyDesired,
 	UINT *pIconId,
+#ifdef __REACTOS__
+	UINT flags,
+    BOOL fUser32)
+#else
 	UINT flags)
+#endif
 {
 	UINT		ret = 0;
 	UINT		cx1, cx2, cy1, cy2;
@@ -576,6 +581,16 @@ static UINT ICO_ExtractIconExW(
 
 #ifdef __REACTOS__
                     icon = CreateIconFromResourceEx(imageData, cbTotal, sig == 1, 0x00030000, cx[index], cy[index], flags);
+
+                    /* This function is called from two difference code paths.
+                     * One is from Shell32 using the ExtractIconEx function.
+                     * The other is from User32 using PrivateExtractIcons.
+                     * Based on W2K3SP2 testing, the count of icons returned
+                     * is zero (0) for PNG ones using ExtractIconEx and
+                     * one (1) for PNG icons using PrivateExtractIcons. 
+                     * This handles the difference for these .ico files.*/
+                     if (fUser32 && (sig == 1))
+                        iconCount = 1;
 #else
                     icon = CreateIconFromResourceEx(imageData, entry->icHeader.biSizeImage, sig == 1, 0x00030000, cx[index], cy[index], flags);
 #endif
@@ -773,7 +788,12 @@ UINT WINAPI PrivateExtractIconsW (
 	{
 	  WARN("Uneven number %d of icons requested for small and large icons!\n", nIcons);
 	}
-	return ICO_ExtractIconExW(lpwstrFile, phicon, nIndex, nIcons, sizeX, sizeY, pIconId, flags);
+#ifdef __REACTOS__
+    return ICO_ExtractIconExW(lpwstrFile, phicon, nIndex, nIcons, sizeX, sizeY,
+                              pIconId, flags, TRUE);
+#else
+    return ICO_ExtractIconExW(lpwstrFile, phicon, nIndex, nIcons, sizeX, sizeY, pIconId, flags);
+#endif
 }
 
 /***********************************************************************
@@ -825,7 +845,12 @@ UINT WINAPI PrivateExtractIconExW (
 
 	if (nIndex == -1)
 	  /* get the number of icons */
-	  return ICO_ExtractIconExW(lpwstrFile, NULL, 0, 0, 0, 0, NULL, LR_DEFAULTCOLOR);
+#ifdef __REACTOS__
+      return ICO_ExtractIconExW(lpwstrFile, NULL, 0, 0, 0, 0, NULL,
+                                LR_DEFAULTCOLOR, FALSE);
+#else
+      return ICO_ExtractIconExW(lpwstrFile, NULL, 0, 0, 0, 0, NULL, LR_DEFAULTCOLOR);
+#endif
 
 	if (nIcons == 1 && phIconSmall && phIconLarge)
 	{
@@ -835,8 +860,15 @@ UINT WINAPI PrivateExtractIconExW (
 	  cxsmicon = GetSystemMetrics(SM_CXSMICON);
 	  cysmicon = GetSystemMetrics(SM_CYSMICON);
 
+#ifdef __REACTOS__
+          ret = ICO_ExtractIconExW(lpwstrFile, hIcon, nIndex, 2,
+                                   cxicon | (cxsmicon<<16),
+                                   cyicon | (cysmicon<<16), NULL,
+                                   LR_DEFAULTCOLOR, FALSE);
+#else
           ret = ICO_ExtractIconExW(lpwstrFile, hIcon, nIndex, 2, cxicon | (cxsmicon<<16),
 	                           cyicon | (cysmicon<<16), NULL, LR_DEFAULTCOLOR);
+#endif
 	  *phIconLarge = hIcon[0];
 	  *phIconSmall = hIcon[1];
  	  return ret;
@@ -847,16 +879,26 @@ UINT WINAPI PrivateExtractIconExW (
 	  /* extract n small icons */
 	  cxsmicon = GetSystemMetrics(SM_CXSMICON);
 	  cysmicon = GetSystemMetrics(SM_CYSMICON);
-	  ret = ICO_ExtractIconExW(lpwstrFile, phIconSmall, nIndex, nIcons, cxsmicon,
-	                           cysmicon, NULL, LR_DEFAULTCOLOR);
+#ifdef __REACTOS__
+      ret = ICO_ExtractIconExW(lpwstrFile, phIconSmall, nIndex, nIcons, cxsmicon,
+                               cysmicon, NULL, LR_DEFAULTCOLOR, FALSE);
+#else
+      ret = ICO_ExtractIconExW(lpwstrFile, phIconSmall, nIndex, nIcons, cxsmicon,
+                               cysmicon, NULL, LR_DEFAULTCOLOR);
+#endif
 	}
        if (phIconLarge)
 	{
 	  /* extract n large icons */
 	  cxicon = GetSystemMetrics(SM_CXICON);
 	  cyicon = GetSystemMetrics(SM_CYICON);
+#ifdef __REACTOS__
          ret = ICO_ExtractIconExW(lpwstrFile, phIconLarge, nIndex, nIcons, cxicon,
-	                           cyicon, NULL, LR_DEFAULTCOLOR);
+                                  cyicon, NULL, LR_DEFAULTCOLOR, FALSE);
+#else
+         ret = ICO_ExtractIconExW(lpwstrFile, phIconLarge, nIndex, nIcons, cxicon,
+                                  cyicon, NULL, LR_DEFAULTCOLOR);
+#endif
 	}
 	return ret;
 }