diff --git a/test/integration/Makefile b/test/integration/Makefile
index 8f2e880305..28f7224eb9 100644
--- a/test/integration/Makefile
+++ b/test/integration/Makefile
@@ -21,7 +21,7 @@ VAULT_PASSWORD_FILE = vault-password
 
 CONSUL_RUNNING := $(shell python consul_running.py)
 
-all: parsing test_var_precedence unicode test_templating_settings environment non_destructive destructive includes pull check_mode test_hash test_handlers test_group_by test_vault test_tags test_lookup_paths no_log
+all: parsing test_var_precedence unicode test_templating_settings environment non_destructive destructive includes blocks pull check_mode test_hash test_handlers test_group_by test_vault test_tags test_lookup_paths no_log
 
 parsing:
 	ansible-playbook bad_parsing.yml -i $(INVENTORY) -e @$(VARS_FILE) $(CREDENTIALS_ARG) -vvv $(TEST_FLAGS) --tags prepare,common,scenario5
@@ -127,6 +127,13 @@ test_tags:
 	# Skip one tag
 	[ "$$(ansible-playbook --list-tasks --skip-tags tag test_tags.yml -i $(INVENTORY) -e @$(VARS_FILE) $(CREDENTIALS_ARG) -v $(TEST_FLAGS) | fgrep Task_with | xargs)" = "Task_with_always_tag TAGS: [always] Task_without_tag TAGS: []" ]
 
+blocks:
+	# remove old output log
+	rm -f block_test.out
+	# run test
+	ansible-playbook -vv test_blocks/main.yml | tee block_test.out
+	# ensure each test ran
+	[ "$$(grep 'TEST COMPLETE' block_test.out | wc -l)" == "$$(egrep '^[0-9]+ plays in' block_test.out | cut -f1 -d' ')" ]
 
 cloud: amazon rackspace azure
 
diff --git a/test/integration/block_test.out b/test/integration/block_test.out
new file mode 100644
index 0000000000..7ba056ae58
--- /dev/null
+++ b/test/integration/block_test.out
@@ -0,0 +1,63 @@
+Using /etc/ansible/ansible.cfg as config file
+2 plays in test_blocks/main.yml
+
+PLAY [simple block test] *******************************************************
+
+TASK [setup] *******************************************************************
+ok: [localhost]
+
+TASK [set block tasks run flag] ************************************************
+ok: [localhost] => {"ansible_facts": {"block_tasks_run": true}, "changed": false}
+
+TASK [fail in tasks] ***********************************************************
+fatal: [localhost]: FAILED! => {"changed": false, "failed": true, "msg": "Failed as requested from task"}
+
+TASK [set block rescue run flag] ***********************************************
+ok: [localhost] => {"ansible_facts": {"block_rescue_run": true}, "changed": false}
+
+TASK [fail in rescue] **********************************************************
+fatal: [localhost]: FAILED! => {"changed": false, "failed": true, "msg": "Failed as requested from task"}
+
+TASK [set block always run flag] ***********************************************
+ok: [localhost] => {"ansible_facts": {"block_always_run": true}, "changed": false}
+
+TASK [set nested block always run flag] ****************************************
+ok: [localhost] => {"ansible_facts": {"nested_block_always_run": true}, "changed": false}
+
+TASK [fail in always] **********************************************************
+fatal: [localhost]: FAILED! => {"changed": false, "failed": true, "msg": "Failed as requested from task"}
+
+TASK [assert] ******************************************************************
+ok: [localhost] => {"changed": false, "msg": "all assertions passed"}
+
+TASK [debug] *******************************************************************
+ok: [localhost] => {
+    "msg": "TEST COMPLETE"
+}
+
+PLAY [block with includes] *****************************************************
+
+TASK [setup] *******************************************************************
+ok: [localhost]
+
+TASK [include fail.yml in tasks] ***********************************************
+included: /data/devel/ansible/test/integration/test_blocks/fail.yml for localhost
+
+TASK [fail] ********************************************************************
+fatal: [localhost]: FAILED! => {"changed": false, "failed": true, "msg": "failed from tasks"}
+
+TASK [set_fact] ****************************************************************
+ok: [localhost] => {"ansible_facts": {"rescue_run_after_include_fail": true}, "changed": false}
+
+TASK [include fail.yml in rescue] **********************************************
+included: /data/devel/ansible/test/integration/test_blocks/fail.yml for localhost
+
+TASK [fail] ********************************************************************
+fatal: [localhost]: FAILED! => {"changed": false, "failed": true, "msg": "failed from rescue"}
+
+TASK [set_fact] ****************************************************************
+ok: [localhost] => {"ansible_facts": {"always_run_after_include_fail_in_rescue": true}, "changed": false}
+
+PLAY RECAP *********************************************************************
+localhost                  : ok=12   changed=0    unreachable=0    failed=3   
+
diff --git a/test/integration/test_blocks/block_test.out b/test/integration/test_blocks/block_test.out
new file mode 100644
index 0000000000..7c17d0094b
--- /dev/null
+++ b/test/integration/test_blocks/block_test.out
@@ -0,0 +1,57 @@
+Using /etc/ansible/ansible.cfg as config file
+2 plays in test.yml
+
+PLAY [simple block test] *******************************************************
+
+TASK [setup] *******************************************************************
+ok: [localhost]
+
+TASK [set block tasks run flag] ************************************************
+ok: [localhost] => {"ansible_facts": {"block_tasks_run": true}, "changed": false}
+
+TASK [fail in tasks] ***********************************************************
+fatal: [localhost]: FAILED! => {"changed": false, "failed": true, "msg": "Failed as requested from task"}
+
+TASK [set block rescue run flag] ***********************************************
+ok: [localhost] => {"ansible_facts": {"block_rescue_run": true}, "changed": false}
+
+TASK [fail in rescue] **********************************************************
+fatal: [localhost]: FAILED! => {"changed": false, "failed": true, "msg": "Failed as requested from task"}
+
+TASK [set block always run flag] ***********************************************
+ok: [localhost] => {"ansible_facts": {"block_always_run": true}, "changed": false}
+
+TASK [set nested block always run flag] ****************************************
+ok: [localhost] => {"ansible_facts": {"nested_block_always_run": true}, "changed": false}
+
+TASK [fail in always] **********************************************************
+fatal: [localhost]: FAILED! => {"changed": false, "failed": true, "msg": "Failed as requested from task"}
+
+TASK [assert] ******************************************************************
+ok: [localhost] => {"changed": false, "msg": "all assertions passed"}
+
+TASK [debug] *******************************************************************
+ok: [localhost] => {
+    "msg": "TEST COMPLETE"
+}
+
+PLAY [block with includes] *****************************************************
+
+TASK [setup] *******************************************************************
+ok: [localhost]
+
+TASK [include fail.yml in tasks] ***********************************************
+included: /root/testing/test_blocks/fail.yml for localhost
+
+TASK [fail] ********************************************************************
+fatal: [localhost]: FAILED! => {"changed": false, "failed": true, "msg": "failed from tasks"}
+
+TASK [set_fact] ****************************************************************
+ok: [localhost] => {"ansible_facts": {"rescue_run_after_include_fail": true}, "changed": false}
+
+TASK [set_fact] ****************************************************************
+ok: [localhost] => {"ansible_facts": {"always_run_after_include_fail_in_rescue": true}, "changed": false}
+
+PLAY RECAP *********************************************************************
+localhost                  : ok=11   changed=0    unreachable=0    failed=2   
+
diff --git a/test/integration/test_blocks/fail.yml b/test/integration/test_blocks/fail.yml
new file mode 100644
index 0000000000..ca8575a907
--- /dev/null
+++ b/test/integration/test_blocks/fail.yml
@@ -0,0 +1 @@
+- fail: msg="{{msg}}"
diff --git a/test/integration/test_blocks/main.yml b/test/integration/test_blocks/main.yml
new file mode 100644
index 0000000000..1e0641ba00
--- /dev/null
+++ b/test/integration/test_blocks/main.yml
@@ -0,0 +1,101 @@
+- name: simple block test
+  hosts: localhost
+  gather_facts: yes
+  vars:
+    block_tasks_run: false
+    block_rescue_run: false
+    block_always_run: false
+    nested_block_always_run: false
+    tasks_run_after_failure: false
+    rescue_run_after_failure: false
+    always_run_after_failure: false
+  tasks:
+  - block:
+    - name: set block tasks run flag
+      set_fact:
+        block_tasks_run: true
+    - name: fail in tasks
+      fail:
+    - name: tasks flag should not be set after failure
+      set_fact:
+        tasks_run_after_failure: true
+    rescue:
+    - name: set block rescue run flag
+      set_fact:
+        block_rescue_run: true
+    - name: fail in rescue
+      fail:
+    - name: tasks flag should not be set after failure in rescue
+      set_fact:
+        rescue_run_after_failure: true
+    always:
+    - name: set block always run flag
+      set_fact:
+        block_always_run: true
+    - block:
+      - meta: noop
+      always:
+      - name: set nested block always run flag
+        set_fact:
+          nested_block_always_run: true
+      - name: fail in always
+        fail:
+      - name: tasks flag should not be set after failure in always
+        set_fact:
+          always_run_after_failure: true
+    - meta: clear_host_errors
+
+  post_tasks:
+  - assert:
+      that:
+      - block_tasks_run
+      - block_rescue_run
+      - block_always_run
+      - nested_block_always_run
+      - not tasks_run_after_failure
+      - not rescue_run_after_failure
+      - not always_run_after_failure
+  - debug: msg="TEST COMPLETE"
+
+- name: block with includes
+  hosts: localhost
+  gather_facts: yes
+  vars:
+    rescue_run_after_include_fail: false
+    always_run_after_include_fail_in_rescue: false
+    tasks_run_after_failure: false
+    rescue_run_after_failure: false
+    always_run_after_failure: false
+  tasks:
+  - block:
+    - name: include fail.yml in tasks
+      include: fail.yml
+      args:
+        msg: "failed from tasks"
+    - name: tasks flag should not be set after failure
+      set_fact:
+        tasks_run_after_failure: true
+    rescue:
+    - set_fact:
+        rescue_run_after_include_fail: true
+    - name: include fail.yml in rescue
+      include: fail.yml
+      args:
+        msg: "failed from rescue"
+    - name: tasks flag should not be set after failure in rescue
+      set_fact:
+        rescue_run_after_failure: true
+    always:
+    - set_fact:
+        always_run_after_include_fail_in_rescue: true
+    - meta: clear_host_errors
+
+  post_tasks:
+  - assert:
+      that:
+      - rescue_run_after_include_fail
+      - always_run_after_include_fail_in_rescue
+      - not tasks_run_after_failure
+      - not rescue_run_after_failure
+      - not always_run_after_failure
+  - debug: msg="TEST COMPLETE"
diff --git a/test/integration/test_blocks/nested_fail.yml b/test/integration/test_blocks/nested_fail.yml
new file mode 100644
index 0000000000..31ae870e37
--- /dev/null
+++ b/test/integration/test_blocks/nested_fail.yml
@@ -0,0 +1,3 @@
+- include: fail.yml
+  args:
+    msg: "nested {{msg}}"
diff --git a/test/integration/test_blocks/nested_nested_fail.yml b/test/integration/test_blocks/nested_nested_fail.yml
new file mode 100644
index 0000000000..e9a050fb98
--- /dev/null
+++ b/test/integration/test_blocks/nested_nested_fail.yml
@@ -0,0 +1,3 @@
+- include: nested_fail.yml
+  args:
+    msg: "nested {{msg}}"