diff --git a/browser/base/content/customizeToolbar.css b/browser/base/content/customizeToolbar.css
index 19f0f6040e30..0b0e0886807f 100644
--- a/browser/base/content/customizeToolbar.css
+++ b/browser/base/content/customizeToolbar.css
@@ -23,11 +23,6 @@
 
 */
 
-.paletteRow {
-  padding-top: 8px;
-  padding-bottom: 8px;
-}
-
 #cloned-bar-container {
   margin: 5px;
 }
@@ -37,10 +32,15 @@
   margin:0px 15px 10px 15px;
 }
 
-toolbarpaletteitem {
+#cloneToolbar > toolbarpaletteitem {
   border-left: 2px solid transparent;
 }
 
-toolbarpaletteitem[dragactive] {
+#cloneToolbar > toolbarpaletteitem[dragactive] {
   border-left: 2px solid black;
 }
+
+#palette-box > hbox > toolbarpaletteitem {
+  padding-top: 8px;
+  padding-bottom: 8px;
+}
diff --git a/browser/base/content/customizeToolbar.js b/browser/base/content/customizeToolbar.js
index c14f0bddf3c6..03d92286c3e5 100644
--- a/browser/base/content/customizeToolbar.js
+++ b/browser/base/content/customizeToolbar.js
@@ -325,7 +325,7 @@ var toolbarDNDObserver = {
 var paletteDNDObserver = {
   onDragOver: function(aEvent, aFlavour, aDragSession)
   {
-    aDragSession.canDrop = !gDraggingFromPalette;
+    aDragSession.canDrop = !gDraggingFromPalette && aEvent.target.localName != "hbox";
   },
   onDrop: function(aEvent, aXferData, aDragSession)
   {
@@ -368,7 +368,7 @@ var paletteDNDObserver = {
  
     // Now insertBefore |item| in the right place.
     var target = aEvent.target;
-    
+
     if (target == palette) {
       target = palette.lastChild.lastChild;
       if (target.localName != "spacer") {