diff --git a/SolidityEndToEndTest.cpp b/SolidityEndToEndTest.cpp
index 80e9aed46..22db67ddb 100644
--- a/SolidityEndToEndTest.cpp
+++ b/SolidityEndToEndTest.cpp
@@ -1650,6 +1650,127 @@ BOOST_AUTO_TEST_CASE(constructor_argument_overriding)
 	BOOST_CHECK(callContractFunction("getA()") == encodeArgs(3));
 }
 
+BOOST_AUTO_TEST_CASE(function_modifier)
+{
+	char const* sourceCode = R"(
+		contract C {
+			function getOne() nonFree returns (uint r) { return 1; }
+			modifier nonFree { if (msg.value > 0) _ }
+		}
+	)";
+	compileAndRun(sourceCode);
+	BOOST_CHECK(callContractFunction("getOne()") == encodeArgs(0));
+	BOOST_CHECK(callContractFunctionWithValue("getOne()", 1) == encodeArgs(1));
+}
+
+BOOST_AUTO_TEST_CASE(function_modifier_local_variables)
+{
+	char const* sourceCode = R"(
+		contract C {
+			modifier mod1 { var a = 1; var b = 2; _ }
+			modifier mod2(bool a) { if (a) return; else _ }
+			function f(bool a) mod1 mod2(a) returns (uint r) { return 3; }
+		}
+	)";
+	compileAndRun(sourceCode);
+	BOOST_CHECK(callContractFunction("f(bool)", true) == encodeArgs(0));
+	BOOST_CHECK(callContractFunction("f(bool)", false) == encodeArgs(3));
+}
+
+BOOST_AUTO_TEST_CASE(function_modifier_loop)
+{
+	char const* sourceCode = R"(
+		contract C {
+			modifier repeat(uint count) { for (var i = 0; i < count; ++i) _ }
+			function f() repeat(10) returns (uint r) { r += 1; }
+		}
+	)";
+	compileAndRun(sourceCode);
+	BOOST_CHECK(callContractFunction("f()") == encodeArgs(10));
+}
+
+BOOST_AUTO_TEST_CASE(function_modifier_multi_invocation)
+{
+	char const* sourceCode = R"(
+		contract C {
+			modifier repeat(bool twice) { if (twice) _ _ }
+			function f(bool twice) repeat(twice) returns (uint r) { r += 1; }
+		}
+	)";
+	compileAndRun(sourceCode);
+	BOOST_CHECK(callContractFunction("f(bool)", false) == encodeArgs(1));
+	BOOST_CHECK(callContractFunction("f(bool)", true) == encodeArgs(2));
+}
+
+BOOST_AUTO_TEST_CASE(function_modifier_multi_with_return)
+{
+	// Here, the explicit return prevents the second execution
+	char const* sourceCode = R"(
+		contract C {
+			modifier repeat(bool twice) { if (twice) _ _ }
+			function f(bool twice) repeat(twice) returns (uint r) { r += 1; return r; }
+		}
+	)";
+	compileAndRun(sourceCode);
+	BOOST_CHECK(callContractFunction("f(bool)", false) == encodeArgs(1));
+	BOOST_CHECK(callContractFunction("f(bool)", true) == encodeArgs(1));
+}
+
+BOOST_AUTO_TEST_CASE(function_modifier_overriding)
+{
+	char const* sourceCode = R"(
+		contract A {
+			function f() mod returns (bool r) { return true; }
+			modifier mod { _ }
+		}
+		contract C is A {
+			modifier mod { }
+		}
+	)";
+	compileAndRun(sourceCode);
+	BOOST_CHECK(callContractFunction("f()") == encodeArgs(false));
+}
+
+BOOST_AUTO_TEST_CASE(function_modifier_calling_functions_in_creation_context)
+{
+	char const* sourceCode = R"(
+		contract A {
+			uint data;
+			function A() mod1 { f1(); }
+			function f1() mod2 { data |= 0x1; }
+			function f2() { data |= 0x20; }
+			function f3() { }
+			modifier mod1 { f2(); _ }
+			modifier mod2 { f3(); }
+			function getData() returns (uint r) { return data; }
+		}
+		contract C is A {
+			modifier mod1 { f4(); _ }
+			function f3() { data |= 0x300; }
+			function f4() { data |= 0x4000; }
+		}
+	)";
+	compileAndRun(sourceCode);
+	BOOST_CHECK(callContractFunction("getData()") == encodeArgs(0x4300));
+}
+
+BOOST_AUTO_TEST_CASE(function_modifier_for_constructor)
+{
+	char const* sourceCode = R"(
+		contract A {
+			uint data;
+			function A() mod1 { data |= 2; }
+			modifier mod1 { data |= 1; _ }
+			function getData() returns (uint r) { return data; }
+		}
+		contract C is A {
+			modifier mod1 { data |= 4; _ }
+		}
+	)";
+	compileAndRun(sourceCode);
+	BOOST_CHECK(callContractFunction("getData()") == encodeArgs(4 | 2));
+}
+
 BOOST_AUTO_TEST_SUITE_END()
 
 }
diff --git a/SolidityExpressionCompiler.cpp b/SolidityExpressionCompiler.cpp
index d50dc253e..06c252db3 100644
--- a/SolidityExpressionCompiler.cpp
+++ b/SolidityExpressionCompiler.cpp
@@ -118,8 +118,11 @@ bytes compileFirstExpression(const string& _sourceCode, vector<vector<string>> _
 			CompilerContext context;
 			for (vector<string> const& function: _functions)
 				context.addFunction(dynamic_cast<FunctionDefinition const&>(resolveDeclaration(function, resolver)));
+			unsigned parametersSize = _localVariables.size(); // assume they are all one slot on the stack
+			context.adjustStackOffset(parametersSize);
 			for (vector<string> const& variable: _localVariables)
-				context.addVariable(dynamic_cast<VariableDeclaration const&>(resolveDeclaration(variable, resolver)));
+				context.addVariable(dynamic_cast<VariableDeclaration const&>(resolveDeclaration(variable, resolver)),
+									parametersSize--);
 
 			ExpressionCompiler::compileExpression(context, *extractor.getExpression());
 
diff --git a/SolidityNameAndTypeResolution.cpp b/SolidityNameAndTypeResolution.cpp
index 079da0a11..3720b3cde 100644
--- a/SolidityNameAndTypeResolution.cpp
+++ b/SolidityNameAndTypeResolution.cpp
@@ -479,6 +479,7 @@ BOOST_AUTO_TEST_CASE(implicit_derived_to_base_conversion)
 	)";
 	BOOST_CHECK_NO_THROW(parseTextAndResolveNames(text));
 }
+
 BOOST_AUTO_TEST_CASE(implicit_base_to_derived_conversion)
 {
 	char const* text = R"(
@@ -490,6 +491,99 @@ BOOST_AUTO_TEST_CASE(implicit_base_to_derived_conversion)
 	BOOST_CHECK_THROW(parseTextAndResolveNames(text), TypeError);
 }
 
+BOOST_AUTO_TEST_CASE(function_modifier_invocation)
+{
+	char const* text = R"(
+		contract B {
+			function f() mod1(2, true) mod2("0123456") { }
+			modifier mod1(uint a, bool b) { if (b) _ }
+			modifier mod2(string7 a) { while (a == "1234567") _ }
+		}
+	)";
+	BOOST_CHECK_NO_THROW(parseTextAndResolveNames(text));
+}
+
+BOOST_AUTO_TEST_CASE(invalid_function_modifier_type)
+{
+	char const* text = R"(
+		contract B {
+			function f() mod1(true) { }
+			modifier mod1(uint a) { if (a > 0) _ }
+		}
+	)";
+	BOOST_CHECK_THROW(parseTextAndResolveNames(text), TypeError);
+}
+
+BOOST_AUTO_TEST_CASE(function_modifier_invocation_parameters)
+{
+	char const* text = R"(
+		contract B {
+			function f(uint8 a) mod1(a, true) mod2(r) returns (string7 r) { }
+			modifier mod1(uint a, bool b) { if (b) _ }
+			modifier mod2(string7 a) { while (a == "1234567") _ }
+		}
+	)";
+	BOOST_CHECK_NO_THROW(parseTextAndResolveNames(text));
+}
+
+BOOST_AUTO_TEST_CASE(function_modifier_invocation_local_variables)
+{
+	char const* text = R"(
+		contract B {
+			function f() mod(x) { uint x = 7; }
+			modifier mod(uint a) { if (a > 0) _ }
+		}
+	)";
+	BOOST_CHECK_NO_THROW(parseTextAndResolveNames(text));
+}
+
+BOOST_AUTO_TEST_CASE(legal_modifier_override)
+{
+	char const* text = R"(
+		contract A { modifier mod(uint a) {} }
+		contract B is A { modifier mod(uint a) {} }
+	)";
+	BOOST_CHECK_NO_THROW(parseTextAndResolveNames(text));
+}
+
+BOOST_AUTO_TEST_CASE(illegal_modifier_override)
+{
+	char const* text = R"(
+		contract A { modifier mod(uint a) {} }
+		contract B is A { modifier mod(uint8 a) {} }
+	)";
+	BOOST_CHECK_THROW(parseTextAndResolveNames(text), TypeError);
+}
+
+BOOST_AUTO_TEST_CASE(modifier_overrides_function)
+{
+	char const* text = R"(
+		contract A { modifier mod(uint a) {} }
+		contract B is A { function mod(uint a) {} }
+	)";
+	BOOST_CHECK_THROW(parseTextAndResolveNames(text), TypeError);
+}
+
+BOOST_AUTO_TEST_CASE(function_overrides_modifier)
+{
+	char const* text = R"(
+		contract A { function mod(uint a) {} }
+		contract B is A { modifier mod(uint a) {} }
+	)";
+	BOOST_CHECK_THROW(parseTextAndResolveNames(text), TypeError);
+}
+
+BOOST_AUTO_TEST_CASE(modifier_returns_value)
+{
+	char const* text = R"(
+		contract A {
+			function f(uint a) mod(2) returns (uint r) {}
+			modifier mod(uint a) { return 7; }
+		}
+	)";
+	BOOST_CHECK_THROW(parseTextAndResolveNames(text), TypeError);
+}
+
 BOOST_AUTO_TEST_SUITE_END()
 
 }
diff --git a/SolidityParser.cpp b/SolidityParser.cpp
index 91e571306..e331b9c6d 100644
--- a/SolidityParser.cpp
+++ b/SolidityParser.cpp
@@ -540,6 +540,43 @@ BOOST_AUTO_TEST_CASE(contract_multiple_inheritance_with_arguments)
 	BOOST_CHECK_NO_THROW(parseText(text));
 }
 
+BOOST_AUTO_TEST_CASE(placeholder_in_function_context)
+{
+	char const* text = "contract c {\n"
+					   "  function fun() returns (uint r) {\n"
+					   "    var _ = 8;\n"
+					   "    return _ + 1;"
+					   "  }\n"
+					   "}\n";
+	BOOST_CHECK_NO_THROW(parseText(text));
+}
+
+BOOST_AUTO_TEST_CASE(modifier)
+{
+	char const* text = "contract c {\n"
+					   "  modifier mod { if (msg.sender == 0) _ }\n"
+					   "}\n";
+	BOOST_CHECK_NO_THROW(parseText(text));
+}
+
+BOOST_AUTO_TEST_CASE(modifier_arguments)
+{
+	char const* text = "contract c {\n"
+					   "  modifier mod(uint a) { if (msg.sender == a) _ }\n"
+					   "}\n";
+	BOOST_CHECK_NO_THROW(parseText(text));
+}
+
+BOOST_AUTO_TEST_CASE(modifier_invocation)
+{
+	char const* text = "contract c {\n"
+					   "  modifier mod1(uint a) { if (msg.sender == a) _ }\n"
+					   "  modifier mod2 { if (msg.sender == 2) _ }\n"
+					   "  function f() mod1(7) mod2 { }\n"
+					   "}\n";
+	BOOST_CHECK_NO_THROW(parseText(text));
+}
+
 BOOST_AUTO_TEST_SUITE_END()
 
 }