diff --git a/lib/haml/precompiler.rb b/lib/haml/precompiler.rb
index f871709e..9fd13eee 100644
--- a/lib/haml/precompiler.rb
+++ b/lib/haml/precompiler.rb
@@ -1,3 +1,5 @@
+require 'strscan'
+
 module Haml
   module Precompiler
     # Designates an XHTML/XML element.
@@ -609,18 +611,29 @@ END
     end
 
     def unescape_interpolation(str)
-      first = str.index(/(^|[^\\])\#\{/)
+      scan = StringScanner.new(str.dump)
+      str = ''
 
-      return str.dump if first.nil?
-      first += 1 unless first == 0
+      while scan.scan(/(.*?)\\\#\{/)
+        str << scan.matched[0...-3]
+        str << eval("\"\\\#{#{balance_brackets(scan)}}\"")
+      end
 
-      last = str.rindex '}'
+      str + scan.rest
+    end
 
-      interpolation = str.slice!(first, last - first)
-      str.insert(first, "_haml_interpolation")
+    def balance_brackets(scanner)
+      str = ''
+      count = 1
 
-      str = str.dump
-      str.gsub("_haml_interpolation", interpolation)
+      while scanner.scan(/(.*?)[\{\}]/)
+        str << scanner.matched
+        count += 1 if scanner.matched[-1] == ?{
+        count -= 1 if scanner.matched[-1] == ?}
+        return str[0...-1] if count == 0
+      end
+
+      raise SyntaxError.new("Unbalanced brackets.")
     end
 
     # Counts the tabulation of a line.
diff --git a/test/haml/engine_test.rb b/test/haml/engine_test.rb
index 168acee8..6e28bb26 100644
--- a/test/haml/engine_test.rb
+++ b/test/haml/engine_test.rb
@@ -265,6 +265,12 @@ class EngineTest < Test::Unit::TestCase
            '"a\nb\n- fee do\nc" doesn\'t produce an exception!')
   end
 
+  def test_unbalanced_brackets
+    render('== #{1 + 5} foo #{6 + 7 bar #{8 + 9}')
+  rescue Haml::SyntaxError => e
+    assert_equal("Unbalanced brackets.", e.message)
+  end
+
   def test_no_bluecloth
     Kernel.module_eval do
       def gem_original_require_with_bluecloth(file)
diff --git a/test/haml/results/just_stuff.xhtml b/test/haml/results/just_stuff.xhtml
index 9c2dda2a..2fd02ddb 100644
--- a/test/haml/results/just_stuff.xhtml
+++ b/test/haml/results/just_stuff.xhtml
@@ -11,6 +11,12 @@ Embedded? false!
 Embedded? true!
 Embedded? true!
 Embedded? twice! true!
+Embedded? one af"t"er another!
+<p>Embedded? false!</p>
+<p>Embedded? true!</p>
+<p>Embedded? true!</p>
+<p>Embedded? twice! true!</p>
+<p>Embedded? one af"t"er another!</p>
 <div class='render'><em>wow!</em></div>
 stuff followed by whitespace
 <strong>block with whitespace</strong>
diff --git a/test/haml/templates/just_stuff.haml b/test/haml/templates/just_stuff.haml
index 28008b9e..1c1d8e01 100644
--- a/test/haml/templates/just_stuff.haml
+++ b/test/haml/templates/just_stuff.haml
@@ -12,6 +12,13 @@
 - embedded = true
 == Embedded? #{embedded}!
 == Embedded? #{"twice! #{true}"}!
+== Embedded? #{"one"} af"t"er #{"another"}!
+%p== Embedded? false!
+%p== Embedded? #{true}!
+- embedded = true
+%p== Embedded? #{embedded}!
+%p== Embedded? #{"twice! #{true}"}!
+%p== Embedded? #{"one"} af"t"er #{"another"}!
 .render= render :inline => "%em= 'wow!'", :type => :haml
 = "stuff followed by whitespace"