diff --git a/rhodecode/apps/repository/views/repo_permissions.py b/rhodecode/apps/repository/views/repo_permissions.py
--- a/rhodecode/apps/repository/views/repo_permissions.py
+++ b/rhodecode/apps/repository/views/repo_permissions.py
@@ -100,22 +100,16 @@ class RepoSettingsPermissionsView(RepoAp
         self.load_default_context()
 
         private_flag = str2bool(self.request.POST.get('private'))
-
+        changes = {
+            'repo_private': private_flag
+        }
         try:
             repo = RepoModel().get(self.db_repo.repo_id)
-            repo.private = private_flag
-            Session().add(repo)
-            RepoModel().grant_user_permission(
-                repo=self.db_repo, user=User.DEFAULT_USER, perm='repository.none'
-            )
-
+            RepoModel().update(repo, **changes)
             Session().commit()
 
             h.flash(_('Repository `{}` private mode set successfully').format(self.db_repo_name),
                     category='success')
-            # NOTE(dan): we change repo private mode we need to notify all USERS
-            affected_user_ids = User.get_all_user_ids()
-            PermissionModel().trigger_permission_flush(affected_user_ids)
 
         except Exception:
             log.exception("Exception during update of repository")
diff --git a/rhodecode/model/repo.py b/rhodecode/model/repo.py
--- a/rhodecode/model/repo.py
+++ b/rhodecode/model/repo.py
@@ -452,15 +452,24 @@ class RepoModel(BaseModel):
 
                     setattr(cur_repo, k, val)
 
-            new_name = cur_repo.get_new_name(kwargs['repo_name'])
-            cur_repo.repo_name = new_name
+            new_name = source_repo_name
+            if 'repo_name' in kwargs:
+                new_name = cur_repo.get_new_name(kwargs['repo_name'])
+                cur_repo.repo_name = new_name
 
-            # if private flag is set, reset default permission to NONE
-            if kwargs.get('repo_private'):
-                EMPTY_PERM = 'repository.none'
-                RepoModel().grant_user_permission(
-                    repo=cur_repo, user=User.DEFAULT_USER, perm=EMPTY_PERM
-                )
+            if 'repo_private' in kwargs:
+                # if private flag is set to True, reset default permission to NONE
+                set_private_to = kwargs.get('repo_private')
+                if set_private_to:
+                    EMPTY_PERM = 'repository.none'
+                    RepoModel().grant_user_permission(
+                        repo=cur_repo, user=User.DEFAULT_USER, perm=EMPTY_PERM
+                    )
+                if set_private_to != cur_repo.private:
+                    # NOTE(dan): we change repo private mode we need to notify all USERS
+                    # this is just by having this value set to a different value then it was before
+                    affected_user_ids = User.get_all_user_ids()
+
             if kwargs.get('repo_landing_rev'):
                 landing_rev_val = kwargs['repo_landing_rev']
                 RepoModel().set_landing_rev(cur_repo, landing_rev_val)
diff --git a/rhodecode/tests/models/test_permissions.py b/rhodecode/tests/models/test_permissions.py
--- a/rhodecode/tests/models/test_permissions.py
+++ b/rhodecode/tests/models/test_permissions.py
@@ -166,6 +166,74 @@ class TestPermissions(object):
 
         test_user_group.user = org_owner
 
+    def test_propagated_permissions_from_repo_group_to_private_repo(self, repo_name):
+        # make group
+        self.g1 = fixture.create_repo_group('TOP_LEVEL', skip_if_exists=True)
+        # both perms should be read !
+        assert group_perms(self.anon) == {
+            'TOP_LEVEL': 'group.read'
+        }
+
+        # Create repo inside the TOP_LEVEL
+        repo_name_in_group = RepoGroup.url_sep().join([self.g1.group_name, 'test_perm_on_private_repo'])
+        self.test_repo = fixture.create_repo(name=repo_name_in_group,
+                                             repo_type='hg',
+                                             repo_group=self.g1,
+                                             cur_user=self.u1,)
+        assert repo_perms(self.anon) == {
+            repo_name_in_group: 'repository.read',
+            'vcs_test_git': 'repository.read',
+            'vcs_test_hg': 'repository.read',
+            'vcs_test_svn': 'repository.read',
+        }
+        # Now change default user permissions
+        new_perm = 'repository.write'
+        perm_updates = [
+            [self.anon.user_id, new_perm, 'user']
+        ]
+        RepoGroupModel().update_permissions(
+            repo_group=self.g1, perm_updates=perm_updates, recursive='all')
+
+        Session().commit()
+        assert repo_perms(self.anon) == {
+            repo_name_in_group: new_perm,
+            'vcs_test_git': 'repository.read',
+            'vcs_test_hg': 'repository.read',
+            'vcs_test_svn': 'repository.read',
+        }
+
+        # NOW MARK repo as private
+        changes = {
+            'repo_private': True
+        }
+        repo = RepoModel().get_by_repo_name(repo_name_in_group)
+        RepoModel().update(repo, **changes)
+        Session().commit()
+
+        # Private repo sets 'none' permission for default user
+        assert repo_perms(self.anon) == {
+            repo_name_in_group: 'repository.none',
+            'vcs_test_git': 'repository.read',
+            'vcs_test_hg': 'repository.read',
+            'vcs_test_svn': 'repository.read',
+        }
+
+        # apply same logic of "updated" recursive, but now the anon permissions should be not be impacted
+        new_perm = 'repository.write'
+        perm_updates = [
+            [self.anon.user_id, new_perm, 'user']
+        ]
+        RepoGroupModel().update_permissions(
+            repo_group=self.g1, perm_updates=perm_updates, recursive='all')
+
+        Session().commit()
+        assert repo_perms(self.anon) == {
+            repo_name_in_group: 'repository.none',
+            'vcs_test_git': 'repository.read',
+            'vcs_test_hg': 'repository.read',
+            'vcs_test_svn': 'repository.read',
+        }
+
     def test_propagated_permission_from_users_group_by_explicit_perms_exist(
             self, repo_name):
         # make group