diff --git a/features/instance_vars.feature b/features/instance_vars.feature
new file mode 100644
index 00000000..dd6bcdee
--- /dev/null
+++ b/features/instance_vars.feature
@@ -0,0 +1,20 @@
+Feature: Instance Vars
+  In order to share data with layouts and partials via instance variables
+
+  Scenario: Setting an instance var in a template should be visible in its layout
+    Given the Server is running at "instance-vars-app"
+    When I go to "/instance-var-set.html"
+    Then I should see "Var is 100"
+
+  Scenario: Setting an instance var in a template should be visible in a partial
+    Given the Server is running at "instance-vars-app"
+    When I go to "/instance-var-set.html"
+    Then I should see "My var is here!"
+
+  Scenario: Setting an instance var in one file should not be visible in another
+    Given the Server is running at "instance-vars-app"
+    When I go to "/instance-var-set.html"
+    When I go to "/no-instance-var.html"
+    Then I should see "No var..."
+  
+    
\ No newline at end of file
diff --git a/fixtures/instance-vars-app/config.rb b/fixtures/instance-vars-app/config.rb
new file mode 100644
index 00000000..e69de29b
diff --git a/fixtures/instance-vars-app/source/_vartial.erb b/fixtures/instance-vars-app/source/_vartial.erb
new file mode 100644
index 00000000..cdf13355
--- /dev/null
+++ b/fixtures/instance-vars-app/source/_vartial.erb
@@ -0,0 +1,5 @@
+<% if @my_var %>
+  My var is here!
+<% else %>
+  No var...
+<% end %>
diff --git a/fixtures/instance-vars-app/source/instance-var-set.html.erb b/fixtures/instance-vars-app/source/instance-var-set.html.erb
new file mode 100644
index 00000000..d785330f
--- /dev/null
+++ b/fixtures/instance-vars-app/source/instance-var-set.html.erb
@@ -0,0 +1,2 @@
+<% @my_var = 100 %>
+<%= partial 'vartial' %>
diff --git a/fixtures/instance-vars-app/source/layout.erb b/fixtures/instance-vars-app/source/layout.erb
new file mode 100644
index 00000000..cbc7ac71
--- /dev/null
+++ b/fixtures/instance-vars-app/source/layout.erb
@@ -0,0 +1,3 @@
+Var is <%= @my_var %>
+
+<%= yield %>
\ No newline at end of file
diff --git a/fixtures/instance-vars-app/source/no-instance-var.html.erb b/fixtures/instance-vars-app/source/no-instance-var.html.erb
new file mode 100644
index 00000000..bcb8a396
--- /dev/null
+++ b/fixtures/instance-vars-app/source/no-instance-var.html.erb
@@ -0,0 +1 @@
+<%= partial 'vartial' %>
diff --git a/lib/middleman/core_extensions/rendering.rb b/lib/middleman/core_extensions/rendering.rb
index e5d587df..4de11543 100644
--- a/lib/middleman/core_extensions/rendering.rb
+++ b/lib/middleman/core_extensions/rendering.rb
@@ -40,8 +40,12 @@ module Middleman::CoreExtensions::Rendering
 
       @current_engine, engine_was = engine, @current_engine
       
+      # Use a dup of self as a context so that instance variables set within 
+      # the template don't persist for other templates.
+      context = self.dup
+
       while ::Tilt[path]
-        content = render_individual_file(path, locs, opts)
+        content = render_individual_file(path, locs, opts, context)
         path = File.basename(path, File.extname(path))
         cache.set([:raw_template, path], content)
       end
@@ -49,7 +53,7 @@ module Middleman::CoreExtensions::Rendering
       needs_layout = !%w(.js .css .txt).include?(extension)
       
       if needs_layout && layout_path = fetch_layout(engine, opts)
-        content = render_individual_file(layout_path, locs, opts) { content }
+        content = render_individual_file(layout_path, locs, opts, context) { content }
       end
         
       content
@@ -92,14 +96,14 @@ module Middleman::CoreExtensions::Rendering
       end
 
       if found_partial
-        render_individual_file(found_partial, locals, options, &block)
+        render_individual_file(found_partial, locals, options, self, &block)
       else
         raise ::Middleman::CoreExtensions::Rendering::TemplateNotFound, "Could not locate partial: #{data}"
       end
     end
 
     # @private
-    def render_individual_file(path, locs = {}, opts = {}, &block)
+    def render_individual_file(path, locs = {}, opts = {}, context, &block)
       path = path.to_s
       
       @_out_buf, _buf_was = "", @_out_buf
@@ -116,7 +120,7 @@ module Middleman::CoreExtensions::Rendering
         ::Tilt.new(path, 1, options) { body }
       end
 
-      template.render(self, locs, &block)
+      template.render(context, locs, &block)
     ensure  
       @_out_buf = _buf_was
     end
@@ -239,4 +243,4 @@ module Middleman::CoreExtensions::Rendering
       end
     end
   end
-end
\ No newline at end of file
+end