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The opacity option of the Gnome terminal in Ubuntu had a neat behavior, which showed the desktop wallpaper instead of the other windows behind it.

Has anyone been able to make Mac Terminal, or an alternative terminal app, do this? I know you can set a terminal wallpaper, which squashes and stretches with the terminal window. Thanks!

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Reset to default
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This can be done simply by typing this command in the terminal:

" defaults write com.apple.terminal TerminalOpaqueness '0.85' "

Without the quotes of course.

You can adjust the opaqueness level to whatever you like

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    The OP specifically wants to see the desktop wallpaper, not other windows behind the Terminal window. This is just a round-about way of changing the Opacity setting under Preferences > Settings.
    – tubedogg
    Aug 27, 2013 at 1:21

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