Index: src/java/com/thoughtworks/xstream/io/binary/Token.java
===================================================================
--- src/java/com/thoughtworks/xstream/io/binary/Token.java	(revision 1688)
+++ src/java/com/thoughtworks/xstream/io/binary/Token.java	(working copy)
@@ -121,7 +121,15 @@
     }
 
     protected void writeString(DataOutput out, String string) throws IOException {
-        out.writeUTF(string);
+        if (string == null) {
+                out.writeInt(-1);
+        } else {
+                final int length = string.length();
+                out.writeInt(length);
+                if(length > 0) {
+                        out.write(string.getBytes());
+                }
+        }
     }
 
     protected long readId(DataInput in, byte idType) throws IOException {
@@ -140,8 +148,17 @@
     }
 
     protected String readString(DataInput in) throws IOException {
-        return in.readUTF();
-    }
+        final int length = in.readInt();
+        if (length == -1) {
+                return null;
+        } else if (length == 0) {
+                return "";
+        } else {
+                final byte[] buf = new byte[length];
+                in.readFully(buf);
+                return new String(buf);
+        }
+    } 
 
     public static class Formatter {
 
Index: src/test/com/thoughtworks/xstream/io/binary/TokenTest.java
===================================================================
--- src/test/com/thoughtworks/xstream/io/binary/TokenTest.java	(revision 1688)
+++ src/test/com/thoughtworks/xstream/io/binary/TokenTest.java	(working copy)
@@ -70,6 +70,15 @@
         assertEquals(9, buffer.size()); // One byte already written for token type.
         assertEquals(token, readOneToken());
     }
+    
+    public void testValueTokenSupportsStringOver65K() throws IOException {
+        StringBuffer sb = new StringBuffer();
+        for(int i=0; i<75000; i++) {
+            sb.append('X');
+        }
+        tokenFormatter.write(out, new Token.Value(sb.toString()));
+        tokenFormatter.read(new DataInputStream(new ByteArrayInputStream(buffer.toByteArray())));
+    }
 
     private Token readOneToken() throws IOException {
         return tokenFormatter.read(new DataInputStream(new ByteArrayInputStream(buffer.toByteArray())));