diff --git a/examples/playbooks/loop_with_items.yml b/examples/playbooks/loop_with_items.yml
new file mode 100644
index 0000000000..a7533d6adf
--- /dev/null
+++ b/examples/playbooks/loop_with_items.yml
@@ -0,0 +1,30 @@
+---
+# this is an example of how to run repeated task elements over lists
+# of items, for example, installing multiple packages or configuring
+# multiple users
+
+- hosts: all
+  user: root
+
+  tasks:
+
+  - name: install $item
+    action: yum pkg=$item state=installed
+    with_items:
+       - cobbler
+       - httpd
+
+  - name: configure user $item
+    action: user name=$item state=present groups=wheel
+    with_items:
+       - testuser1
+       - testuser2
+
+  - name: remove user $item
+    action: user name=$item state=absent
+    with_items:
+        - testuser1
+        - testuser2
+
+
+
diff --git a/lib/ansible/playbook.py b/lib/ansible/playbook.py
index 7757caafa2..ba5115d02d 100755
--- a/lib/ansible/playbook.py
+++ b/lib/ansible/playbook.py
@@ -163,7 +163,30 @@ class PlayBook(object):
                     self._include_tasks(play, task, dirname, new_tasks)
                 else:
                     new_tasks.append(task)
-            play['tasks'] = new_tasks
+
+            # now new_tasks contains a list of tasks, but tasks may contain
+            # lists of with_items to loop over.  Do that.
+            # TODO: refactor into subfunction
+            new_tasks2 = []
+            for task in new_tasks:
+                if 'with_items' in task:
+                    for item in task['with_items']:
+                        produced_task = {}
+                        name    = task.get('name', task.get('action', 'unnamed task'))
+                        action  = task.get('action', None)
+                        only_if = task.get('only_if', None)
+                        if action is None:
+                            raise errors.AnsibleError('action is required')
+                        produced_task = task.copy()
+                        produced_task['action'] = utils.template(action, dict(item=item))
+                        produced_task['name'] = utils.template(name, dict(item=item))
+                        if only_if:
+                            produced_task['only_if'] = utils.template(only_if, dict(item=item))
+                        new_tasks2.append(produced_task)
+                else:
+                    new_tasks2.append(task)
+
+            play['tasks'] = new_tasks2
 
             # process handlers as well as imported handlers
             new_handlers = []