diff --git a/awx/main/tasks.py b/awx/main/tasks.py
index f1d28938f5..06a5288d6e 100644
--- a/awx/main/tasks.py
+++ b/awx/main/tasks.py
@@ -1361,9 +1361,9 @@ class RunInventoryUpdate(BaseTask):
 
             vmware_opts = dict(inventory_update.source_vars_dict.items())
             if inventory_update.instance_filters:
-                inventory_update.setdefault('host_filters', inventory_update.instance_filters)
+                vmware_opts.setdefault('host_filters', inventory_update.instance_filters)
             if inventory_update.group_by:
-                inventory_update.setdefault('groupby_patterns', inventory_update.groupby_patterns)
+                vmware_opts.setdefault('groupby_patterns', inventory_update.groupby_patterns)
 
             for k,v in vmware_opts.items():
                 cp.set(section, k, unicode(v))
diff --git a/awx/settings/defaults.py b/awx/settings/defaults.py
index 35911f4c71..b283387350 100644
--- a/awx/settings/defaults.py
+++ b/awx/settings/defaults.py
@@ -663,8 +663,8 @@ VMWARE_REGIONS_BLACKLIST = []
 
 # Inventory variable name/values for determining whether a host is
 # active in vSphere.
-VMWARE_ENABLED_VAR = 'vmware_powerState'
-VMWARE_ENABLED_VALUE = 'poweredOn'
+VMWARE_ENABLED_VAR = 'guest.gueststate'
+VMWARE_ENABLED_VALUE = 'running'
 
 # Inventory variable name containing the unique instance ID.
 VMWARE_INSTANCE_ID_VAR = 'vmware_uuid'