diff --git a/CHANGES b/CHANGES
index 5d85ad3f..2ea68708 100644
--- a/CHANGES
+++ b/CHANGES
@@ -1,5 +1,7 @@
 = 1.4.0 / Not Yet Released
 
+ * Add support for Yajl templates. (Jamie Hodge)
+
  * No longer include Sinatra::Delegator in Object, instead extend the main
    object only. (Konstantin Haase)
 
diff --git a/Gemfile b/Gemfile
index 9cbb80a9..f8b9679e 100644
--- a/Gemfile
+++ b/Gemfile
@@ -42,6 +42,7 @@ gem 'maruku'
 gem 'creole'
 gem 'markaby'
 gem 'radius'
+gem 'yajl-ruby'
 
 if RUBY_ENGINE == 'jruby'
   gem 'nokogiri', '!= 1.5.0'
diff --git a/README.rdoc b/README.rdoc
index 681f6c69..1c72c15a 100644
--- a/README.rdoc
+++ b/README.rdoc
@@ -514,6 +514,21 @@ Dependency::        {coffee-script}[https://github.com/josh/ruby-coffee-script]
 File Extensions::   <tt>.coffee</tt>
 Example::           <tt>coffee :index</tt>
 
+=== Yajl Templates
+
+Dependency::        {yajl-ruby}[https://github.com/brianmario/yajl-ruby]
+File Extensions::   <tt>.yajl</tt>
+Example::           <tt>yajl :index, :locals => { :key => 'qux' }, :callback => 'present', :variable => 'resource' </tt>
+
+The template source is evaluated as a Ruby string, and the resulting json variable is converted #to_json.
+
+  json = { :foo => 'bar' }
+  json[:baz] = key
+
+The <tt>:callback</tt> and <tt>:variable</tt> options can be used to decorate the rendered object.
+
+  var resource = {"foo":"bar","baz":"qux"}; present(resource);
+
 === Embedded Templates
 
   get '/' do
diff --git a/lib/sinatra/base.rb b/lib/sinatra/base.rb
index 7cd0825d..dc4a7de2 100644
--- a/lib/sinatra/base.rb
+++ b/lib/sinatra/base.rb
@@ -603,6 +603,11 @@ module Sinatra
       render :creole, template, options, locals
     end
 
+    def yajl(template, options={}, locals={})
+      options[:default_content_type] = :json
+      render :yajl, template, options, locals
+    end
+
     # Calls the given block for every possible template file in views,
     # named name.ext, where ext is registered on engine.
     def find_template(views, name, engine)
diff --git a/test/views/hello.yajl b/test/views/hello.yajl
new file mode 100644
index 00000000..68ef6a6c
--- /dev/null
+++ b/test/views/hello.yajl
@@ -0,0 +1 @@
+json = { :yajl => "hello" }
\ No newline at end of file
diff --git a/test/yajl_test.rb b/test/yajl_test.rb
new file mode 100644
index 00000000..546ee5a3
--- /dev/null
+++ b/test/yajl_test.rb
@@ -0,0 +1,80 @@
+require File.expand_path('../helper', __FILE__)
+
+begin
+require 'yajl'
+
+class YajlTest < Test::Unit::TestCase
+  def yajl_app(&block)
+    mock_app {
+      set :views, File.dirname(__FILE__) + '/views'
+      get '/', &block
+    }
+    get '/'
+  end
+
+  it 'renders inline Yajl strings' do
+    yajl_app { yajl 'json = { :foo => "bar" }' }
+    assert ok?
+    assert_body '{"foo":"bar"}'
+  end
+
+  it 'renders .yajl files in views path' do
+    yajl_app { yajl :hello }
+    assert ok?
+    assert_body '{"yajl":"hello"}'
+  end
+
+  it 'raises error if template not found' do
+    mock_app {
+      get('/') { yajl :no_such_template }
+    }
+    assert_raise(Errno::ENOENT) { get('/') }
+  end
+
+  it 'accepts a :locals option' do
+    yajl_app {
+      locals = { :object => { :foo => 'bar' } }
+      yajl 'json = object', :locals => locals
+    }
+    assert ok?
+    assert_body '{"foo":"bar"}'
+  end
+
+  it 'accepts a :scope option' do
+    yajl_app {
+      scope = { :object => { :foo => 'bar' } }
+      yajl 'json = self[:object]', :scope => scope
+    }
+    assert ok?
+    assert_body '{"foo":"bar"}'
+  end
+
+  it 'decorates the json with a callback' do
+    yajl_app {
+      yajl 'json = { :foo => "bar" }', { :callback => 'baz' }
+    }
+    assert ok?
+    assert_body 'baz({"foo":"bar"});'
+  end
+
+  it 'decorates the json with a variable' do
+    yajl_app {
+      yajl 'json = { :foo => "bar" }', { :variable => 'qux' }
+    }
+    assert ok?
+    assert_body 'var qux = {"foo":"bar"};'
+  end
+
+  it 'decorates the json with a callback and a variable' do
+    yajl_app {
+      yajl 'json = { :foo => "bar" }',
+        { :callback => 'baz', :variable => 'qux' }
+    }
+    assert ok?
+    assert_body 'var qux = {"foo":"bar"}; baz(qux);'
+  end
+end
+
+rescue LoadError
+  warn "#{$!.to_s}: skipping yajl tests"
+end