diff --git a/lib/ansible/inventory.py b/lib/ansible/inventory.py
index c3678d64a5..46a5edb589 100644
--- a/lib/ansible/inventory.py
+++ b/lib/ansible/inventory.py
@@ -168,6 +168,8 @@ class Inventory(object):
         hosts = []
         groups = {}
 
+        ungrouped = []
+
         for item in data:
             if type(item) == dict:
                 if "group" in item:
@@ -186,13 +188,14 @@ class Inventory(object):
                     groups[group_name] = group_hosts
                     hosts.extend(group_hosts)
 
-                # or a host
                 elif "host" in item:
                     host_name = self._parse_yaml_host(item)
                     hosts.append(host_name)
+                    ungrouped.append(host_name)
             else:
                 host_name = self._parse_yaml_host(item)
                 hosts.append(host_name)
+                ungrouped.append(host_name)
 
         # filter duplicate hosts
         output_hosts = []
@@ -200,6 +203,18 @@ class Inventory(object):
             if host not in output_hosts:
                 output_hosts.append(host)
 
+        if len(ungrouped) > 0 :
+            # hosts can be defined top-level, but also in a group
+            really_ungrouped = []
+            for host in ungrouped:
+                already_grouped = False
+                for name, group_hosts in groups.items():
+                    if host in group_hosts:
+                        already_grouped = True
+                if not already_grouped:
+                    really_ungrouped.append(host)
+            groups["ungrouped"] = really_ungrouped
+
         return output_hosts, groups
 
     def _parse_yaml_host(self, item, variables=[]):
diff --git a/test/TestInventory.py b/test/TestInventory.py
index a0b0b74d16..21cccf5fe8 100644
--- a/test/TestInventory.py
+++ b/test/TestInventory.py
@@ -51,6 +51,13 @@ class TestInventory(unittest.TestCase):
         expected_hosts=['thor', 'odin', 'loki']
         assert hosts == expected_hosts
 
+    def test_simple_ungrouped(self):
+        inventory = self.simple_inventory()
+        hosts = inventory.list_hosts("ungrouped")
+
+        expected_hosts=['jupiter', 'saturn']
+        assert hosts == expected_hosts
+
     def test_simple_combined(self):
         inventory = self.simple_inventory()
         hosts = inventory.list_hosts("norse:greek")
@@ -176,6 +183,13 @@ class TestInventory(unittest.TestCase):
         expected_hosts=['thor', 'odin', 'loki']
         assert hosts == expected_hosts
 
+    def test_simple_ungrouped(self):
+        inventory = self.yaml_inventory()
+        hosts = inventory.list_hosts("ungrouped")
+
+        expected_hosts=['jupiter']
+        assert hosts == expected_hosts
+
     def test_yaml_combined(self):
         inventory = self.yaml_inventory()
         hosts = inventory.list_hosts("norse:greek")
diff --git a/test/yaml_hosts b/test/yaml_hosts
index 95f278b91a..7568ff4bda 100644
--- a/test/yaml_hosts
+++ b/test/yaml_hosts
@@ -5,6 +5,8 @@
   vars:
   - moon: titan
 
+- zeus
+
 - group: greek
   hosts:
   - zeus