diff --git a/src/lib/radio/radio.spec.ts b/src/lib/radio/radio.spec.ts
index 1925c4efac01..5ff9427ba1af 100644
--- a/src/lib/radio/radio.spec.ts
+++ b/src/lib/radio/radio.spec.ts
@@ -285,6 +285,29 @@ describe('MdRadio', () => {
       expect(groupInstance.value).toBe('water');
       expect(changeSpy).not.toHaveBeenCalled();
     });
+
+    it(`should update checked status if changed value to radio group's value`, () => {
+      let changeSpy = jasmine.createSpy('radio-group change listener');
+      groupInstance.change.subscribe(changeSpy);
+      groupInstance.value = 'apple';
+
+      expect(changeSpy).not.toHaveBeenCalled();
+      expect(groupInstance.value).toBe('apple');
+      expect(groupInstance.selected).toBeFalsy('expect group selected to be null');
+      expect(radioInstances[0].checked).toBeFalsy('should not select the first button');
+      expect(radioInstances[1].checked).toBeFalsy('should not select the second button');
+      expect(radioInstances[2].checked).toBeFalsy('should not select the third button');
+
+      radioInstances[0].value = 'apple';
+
+      fixture.detectChanges();
+
+      expect(groupInstance.selected).toBe(
+        radioInstances[0], 'expect group selected to be first button');
+      expect(radioInstances[0].checked).toBeTruthy('expect group select the first button');
+      expect(radioInstances[1].checked).toBeFalsy('should not select the second button');
+      expect(radioInstances[2].checked).toBeFalsy('should not select the third button');
+    });
   });
 
   describe('group with ngModel', () => {
diff --git a/src/lib/radio/radio.ts b/src/lib/radio/radio.ts
index 6203a69aef27..2e94696561af 100644
--- a/src/lib/radio/radio.ts
+++ b/src/lib/radio/radio.ts
@@ -127,6 +127,13 @@ export class MdRadioGroup implements AfterContentInit, ControlValueAccessor {
       this._value = newValue;
 
       this._updateSelectedRadioFromValue();
+      this._checkSelectedRadioButton();
+    }
+  }
+
+  _checkSelectedRadioButton() {
+    if (this.selected && !this._selected.checked) {
+      this._selected.checked = true;
     }
   }
 
@@ -139,9 +146,7 @@ export class MdRadioGroup implements AfterContentInit, ControlValueAccessor {
     this._selected = selected;
     this.value = selected ? selected.value : null;
 
-    if (selected && !selected.checked) {
-      selected.checked = true;
-    }
+    this._checkSelectedRadioButton();
   }
 
   /**
@@ -180,14 +185,13 @@ export class MdRadioGroup implements AfterContentInit, ControlValueAccessor {
     let isAlreadySelected = this._selected != null && this._selected.value == this._value;
 
     if (this._radios != null && !isAlreadySelected) {
-      let matchingRadio = this._radios.filter(radio => radio.value == this._value)[0];
-
-      if (matchingRadio) {
-        this.selected = matchingRadio;
-      } else if (this.value == null) {
-        this.selected = null;
-        this._radios.forEach(radio => { radio.checked = false; });
-      }
+      this._selected = null;
+      this._radios.forEach(radio => {
+        radio.checked = this.value == radio.value;
+        if (radio.checked) {
+          this._selected = radio;
+        }
+      });
     }
   }
 
@@ -303,19 +307,21 @@ export class MdRadioButton implements OnInit {
   }
 
   set checked(newCheckedState: boolean) {
-    this._checked = newCheckedState;
-
-    if (newCheckedState && this.radioGroup && this.radioGroup.value != this.value) {
-      this.radioGroup.selected = this;
-    } else if (!newCheckedState && this.radioGroup && this.radioGroup.value == this.value) {
-      // When unchecking the selected radio button, update the selected radio
-      // property on the group.
-      this.radioGroup.selected = null;
-    }
+    if (this._checked != newCheckedState) {
+      this._checked = newCheckedState;
+
+      if (newCheckedState && this.radioGroup && this.radioGroup.value != this.value) {
+        this.radioGroup.selected = this;
+      } else if (!newCheckedState && this.radioGroup && this.radioGroup.value == this.value) {
+        // When unchecking the selected radio button, update the selected radio
+        // property on the group.
+        this.radioGroup.selected = null;
+      }
 
-    if (newCheckedState) {
-      // Notify all radio buttons with the same name to un-check.
-      this.radioDispatcher.notify(this.id, this.name);
+      if (newCheckedState) {
+        // Notify all radio buttons with the same name to un-check.
+        this.radioDispatcher.notify(this.id, this.name);
+      }
     }
   }
 
@@ -327,10 +333,17 @@ export class MdRadioButton implements OnInit {
 
   set value(value: any) {
     if (this._value != value) {
-      if (this.radioGroup != null && this.checked) {
-        this.radioGroup.value = value;
-      }
       this._value = value;
+      if (this.radioGroup != null) {
+        if (!this.checked) {
+          // Update checked when the value changed to match the radio group's value
+          this.checked = this.radioGroup.value == value;
+        }
+        if (this.checked) {
+          this.radioGroup.selected = this;
+        }
+      }
+
     }
   }