diff --git a/examples/base.yml b/examples/base.yml
new file mode 100644
index 0000000000..8841afb1d5
--- /dev/null
+++ b/examples/base.yml
@@ -0,0 +1,5 @@
+---
+- name: no selinux
+  action: command /usr/sbin/setenforce 0
+- name: no iptables
+  action: service name=iptables state=stopped
diff --git a/examples/handlers.yml b/examples/handlers.yml
new file mode 100644
index 0000000000..44b2b3d895
--- /dev/null
+++ b/examples/handlers.yml
@@ -0,0 +1,5 @@
+---
+- name: restart apache
+  action: service name=httpd state=restarted
+- name: restart memcached
+  action: service name=memcached state=restarted
diff --git a/examples/playbook.yml b/examples/playbook.yml
index 188e24fcd7..fc4310976d 100644
--- a/examples/playbook.yml
+++ b/examples/playbook.yml
@@ -1,6 +1,7 @@
 ---
 - hosts: '*'
   tasks:
+  - include: base.yml
   - name: configure template & module variables for future template calls
     action: setup http_port=80 max_clients=200
   - name: write the apache config file
@@ -10,5 +11,4 @@
   - name: ensure apache is running
     action: service name=httpd state=started
   handlers:
-    - name: restart apache
-    - action: service name=httpd state=restarted
+    - include: handlers.yml
diff --git a/lib/ansible/playbook.py b/lib/ansible/playbook.py
index f236a33497..e89ee67cf1 100755
--- a/lib/ansible/playbook.py
+++ b/lib/ansible/playbook.py
@@ -15,14 +15,16 @@
 # You should have received a copy of the GNU General Public License
 # along with Ansible.  If not, see <http://www.gnu.org/licenses/>.
 
+#############################################
+
 import ansible.runner
 import ansible.constants as C
 from ansible.utils import *
 import yaml
 import shlex
+import os
 
-# TODO: make a constants file rather than
-# duplicating these
+#############################################
 
 class PlayBook(object):
 
@@ -72,9 +74,43 @@ class PlayBook(object):
         # playbook file can be passed in as a path or
         # as file contents (to support API usage)
 
-        if type(playbook) == str:
-            playbook = yaml.load(file(playbook).read())
-        self.playbook = playbook
+        self.playbook = self._parse_playbook(playbook)
+
+    def _parse_playbook(self, playbook):
+        ''' load YAML file, including handling for imported files '''
+        
+        dirname  = os.path.dirname(playbook)
+        playbook = yaml.load(file(playbook).read())
+
+        for play in playbook:
+            tasks = play.get('tasks',[])
+            handlers = play.get('handlers', [])
+
+            # process tasks in this file as well as imported tasks
+            new_tasks = []
+            for task in tasks:
+               if 'include' in task:
+                   path = path_dwim(dirname, task['include'])
+                   included = yaml.load(file(path).read())
+                   for x in included:
+                       new_tasks.append(x)
+               else:
+                   new_tasks.append(task)
+            play['tasks'] = new_tasks
+
+            # process handlers as well as imported handlers
+            new_handlers = [] 
+            for handler in handlers:
+               if 'include' in handler:
+                   path = path_dwim(dirname, handler['include'])
+                   included = yaml.load(file(path).read())
+                   for x in included:
+                       new_handlers.append(x)
+               else:
+                   new_handlers.append(handler)
+            play['handlers'] = new_handlers
+
+        return playbook
         
     def run(self):
         ''' run all patterns in the playbook '''
@@ -227,7 +263,7 @@ class PlayBook(object):
             if match_name == name:
                 # flag the handler with the list of hosts
                 # it needs to be run on, it will be run later
-                if not run in x:
+                if not 'run' in x:
                     x['run'] = []
                 x['run'].append(host)
 
diff --git a/lib/ansible/utils.py b/lib/ansible/utils.py
index 5e80f8c0e8..29f37bdd22 100755
--- a/lib/ansible/utils.py
+++ b/lib/ansible/utils.py
@@ -165,4 +165,12 @@ def prepare_writeable_dir(tree):
     if not os.access(tree, os.W_OK):
         exit("Cannot write to path %s" % tree)
 
+def path_dwim(basedir, given):
+    if given.startswith("/"):
+        return given
+    elif given.startswith("~/"):
+        return os.path.expanduser(given)
+    else:
+        return os.path.join(basedir, given)
 
+