diff --git a/middleman-core/features/data.feature b/middleman-core/features/data.feature
index 6d5b06c1..0c444f3c 100644
--- a/middleman-core/features/data.feature
+++ b/middleman-core/features/data.feature
@@ -5,18 +5,23 @@ Feature: Local Data API
     Given the Server is running at "basic-data-app"
     When I go to "/data.html"
     Then I should see "One:Two"
-  
+
   Scenario: Rendering json
     Given the Server is running at "basic-data-app"
     When I go to "/data3.html"
     Then I should see "One:Two"
-    
+
   Scenario: Using data in config.rb
     Given the Server is running at "data-app"
     When I go to "/test1.html"
     Then I should see "Welcome"
-    
+
   Scenario: Using data2 in config.rb
     Given the Server is running at "data-app"
     When I go to "/test2.html"
-    Then I should see "Welcome"
\ No newline at end of file
+    Then I should see "Welcome"
+
+  Scenario: Using nested data
+    Given the Server is running at "nested-data-app"
+    When I go to "/test.html"
+    Then I should see "test:Hello"
diff --git a/middleman-core/fixtures/nested-data-app/config.rb b/middleman-core/fixtures/nested-data-app/config.rb
new file mode 100644
index 00000000..09ff69dd
--- /dev/null
+++ b/middleman-core/fixtures/nested-data-app/config.rb
@@ -0,0 +1 @@
+set :layout, false
diff --git a/middleman-core/fixtures/nested-data-app/data/examples/test.yml b/middleman-core/fixtures/nested-data-app/data/examples/test.yml
new file mode 100644
index 00000000..d4b1eeeb
--- /dev/null
+++ b/middleman-core/fixtures/nested-data-app/data/examples/test.yml
@@ -0,0 +1 @@
+title: "Hello"
diff --git a/middleman-core/fixtures/nested-data-app/source/test.html.erb b/middleman-core/fixtures/nested-data-app/source/test.html.erb
new file mode 100644
index 00000000..acd20c82
--- /dev/null
+++ b/middleman-core/fixtures/nested-data-app/source/test.html.erb
@@ -0,0 +1 @@
+<%= data.examples.map { |k, r| [k, r.title].join(":") }.join %>
diff --git a/middleman-core/lib/middleman-core/core_extensions/data.rb b/middleman-core/lib/middleman-core/core_extensions/data.rb
index c2167739..adf39216 100644
--- a/middleman-core/lib/middleman-core/core_extensions/data.rb
+++ b/middleman-core/lib/middleman-core/core_extensions/data.rb
@@ -92,19 +92,30 @@ module Middleman
         # @param [String] file The file to be re-parsed
         # @return [void]
         def touch_file(file)
-          file = File.expand_path(file, @app.root)
+          root = Pathname(@app.root)
+          full_path = root + file
           extension = File.extname(file)
           basename  = File.basename(file, extension)
 
+          data_path = full_path.relative_path_from(root + @app.config[:data_dir])
+
           if %w(.yaml .yml).include?(extension)
-            data = YAML.load_file(file)
+            data = YAML.load_file(full_path)
           elsif extension == ".json"
-            data = ActiveSupport::JSON.decode(File.read(file))
+            data = ActiveSupport::JSON.decode(full_path.read)
           else
             return
           end
 
-          @local_data[basename] = ::Middleman::Util.recursively_enhance(data)
+          data_branch = @local_data
+
+          path = data_path.to_s.split(File::SEPARATOR)[0..-2]
+          path.each do |dir|
+            data_branch[dir] ||= ::Middleman::Util.recursively_enhance({})
+            data_branch = data_branch[dir]
+          end
+
+          data_branch[basename] = ::Middleman::Util.recursively_enhance(data)
         end
 
         # Remove a given file from the internal cache
@@ -112,9 +123,21 @@ module Middleman
         # @param [String] file The file to be cleared
         # @return [void]
         def remove_file(file)
+          root = Pathname(@app.root)
+          full_path = root + file
           extension = File.extname(file)
           basename  = File.basename(file, extension)
-          @local_data.delete(basename) if @local_data.has_key?(basename)
+
+          data_path = full_path.relative_path_from(root + @app.config[:data_dir])
+
+          data_branch = @local_data
+
+          path = data_path.to_s.split(File::SEPARATOR)[0..-2]
+          path.each do |dir|
+            data_branch = data_branch[dir]
+          end
+
+          data_branch.delete(basename) if data_branch.has_key?(basename)
         end
 
         # Get a hash from either internal static data or a callback