diff --git a/src/Makefile.am b/src/Makefile.am
index a3cd46ca27..7d12719ac4 100644
--- a/src/Makefile.am
+++ b/src/Makefile.am
@@ -1,4 +1,4 @@
-bin_PROGRAMS = nix
+bin_PROGRAMS = nix fix
 check_PROGRAMS = test
 
 AM_CXXFLAGS = -DSYSTEM=\"@host@\" -Wall -I..
@@ -6,6 +6,9 @@ AM_CXXFLAGS = -DSYSTEM=\"@host@\" -Wall -I..
 nix_SOURCES = nix.cc shared.cc
 nix_LDADD = libnix.a -ldb_cxx-4 -lATerm
 
+fix_SOURCES = fix.cc shared.cc
+fix_LDADD = libnix.a -ldb_cxx-4 -lATerm
+
 TESTS = test
 
 test_SOURCES = test.cc
diff --git a/src/eval.cc b/src/eval.cc
index 4f4d419f5e..354ecb6cc7 100644
--- a/src/eval.cc
+++ b/src/eval.cc
@@ -145,9 +145,7 @@ string printTerm(ATerm t)
 }
 
 
-/* Throw an exception with an error message containing the given
-   aterm. */
-static Error badTerm(const format & f, ATerm t)
+Error badTerm(const format & f, ATerm t)
 {
     return Error(format("%1%, in `%2%'") % f.str() % printTerm(t));
 }
@@ -176,7 +174,7 @@ static ATerm termFromHash(const Hash & hash)
 }
 
 
-static Hash writeTerm(ATerm t)
+Hash writeTerm(ATerm t)
 {
     string path = nixStore + "/tmp.nix"; /* !!! */
     if (!ATwriteToNamedTextFile(t, path.c_str()))
@@ -217,18 +215,19 @@ static FState realise(RStatus & status, FState fs)
         return realise(status, termFromHash(parseHash(s1)));
     }
     
-    else if (ATmatch(fs, "File(<str>, <term>, [<list>])", &s1, &content, &refs)) {
+    else if (ATmatch(fs, "Path(<str>, <term>, [<list>])", &s1, &content, &refs)) {
         string path(s1);
 
         msg(format("realising atomic path %1%") % path);
         Nest nest(true);
 
-        if (path[0] != '/') throw Error("absolute path expected: " + path);
+        if (path[0] != '/')
+            throw Error(format("path `%1% is not absolute") % path);
 
         /* Realise referenced paths. */
         ATermList refs2 = ATempty;
         while (!ATisEmpty(refs)) {
-            refs2 = ATappend(refs2, realise(status, ATgetFirst(refs)));
+            refs2 = ATinsert(refs2, realise(status, ATgetFirst(refs)));
             refs = ATgetNext(refs);
         }
         refs2 = ATreverse(refs2);
@@ -238,7 +237,7 @@ static FState realise(RStatus & status, FState fs)
         Hash hash = parseHash(s1);
 
         /* Normal form. */
-        ATerm nf = ATmake("File(<str>, <term>, <term>)",
+        ATerm nf = ATmake("Path(<str>, <term>, <term>)",
             path.c_str(), content, refs2);
 
         /* Register the normal form. */
@@ -261,7 +260,7 @@ static FState realise(RStatus & status, FState fs)
 
         /* Do we know a path with that hash?  If so, copy it. */
         string path2 = queryFromStore(hash);
-        copyFile(path2, path);
+        copyPath(path2, path);
 
         return nf;
     }
@@ -279,7 +278,7 @@ static FState realise(RStatus & status, FState fs)
         /* Realise inputs. */
         ATermList ins2 = ATempty;
         while (!ATisEmpty(ins)) {
-            ins2 = ATappend(ins2, realise(status, ATgetFirst(ins)));
+            ins2 = ATinsert(ins2, realise(status, ATgetFirst(ins)));
             ins = ATgetNext(ins);
         }
         ins2 = ATreverse(ins2);
@@ -289,7 +288,7 @@ static FState realise(RStatus & status, FState fs)
         while (!ATisEmpty(bnds)) {
             ATerm bnd = ATgetFirst(bnds);
             if (!ATmatch(bnd, "(<str>, <str>)", &s1, &s2))
-                throw badTerm("string expected", bnd);
+                throw badTerm("tuple of strings expected", bnd);
             env[s1] = s2;
             bnds = ATgetNext(bnds);
         }
@@ -322,7 +321,7 @@ static FState realise(RStatus & status, FState fs)
         setDB(nixDB, dbRefs, outHash, outPath);
 
         /* Register the normal form of fs. */
-        FState nf = ATmake("File(<str>, Hash(<str>), <term>)",
+        FState nf = ATmake("Path(<str>, Hash(<str>), <term>)",
             outPath.c_str(), ((string) outHash).c_str(), ins2);
         Hash nfHash = writeTerm(nf);
         setDB(nixDB, dbSuccessors, hashTerm(fs), nfHash);
diff --git a/src/eval.hh b/src/eval.hh
index 553c7c40b2..b04588e7b3 100644
--- a/src/eval.hh
+++ b/src/eval.hh
@@ -15,9 +15,9 @@ using namespace std;
    A Nix file system state expression, or FState, describes a
    (partial) state of the file system.
 
-     File : Path * Content * [FState] -> FState
+     Path : Path * Content * [FState] -> FState
 
-   File(path, content, refs) specifies a file object (its full path
+   Path(path, content, refs) specifies a file object (its full path
    and contents), along with all file objects referenced by it (that
    is, that it has pointers to).  We assume that all files are
    self-referential.  This prevents us from having to deal with
@@ -66,8 +66,15 @@ FState realiseFState(FState fs);
 /* Return a canonical textual representation of an expression. */
 string printTerm(ATerm t);
 
+/* Throw an exception with an error message containing the given
+   aterm. */
+Error badTerm(const format & f, ATerm t);
+
 /* Hash an aterm. */
 Hash hashTerm(ATerm t);
 
+/* Write an aterm to the Nix store directory, and return its hash. */
+Hash writeTerm(ATerm t);
+
 
 #endif /* !__EVAL_H */
diff --git a/src/fix.cc b/src/fix.cc
new file mode 100644
index 0000000000..cb42aca6b7
--- /dev/null
+++ b/src/fix.cc
@@ -0,0 +1,266 @@
+#include <map>
+#include <iostream>
+
+#include "globals.hh"
+#include "eval.hh"
+#include "values.hh"
+#include "shared.hh"
+
+
+typedef ATerm Expr;
+
+
+static Expr evalFile(string fileName);
+
+
+static bool isFState(Expr e, string & path)
+{
+    char * s1, * s2, * s3;
+    Expr e1, e2;
+    if (ATmatch(e, "Path(<str>, <term>, [<list>])", &s1, &e1, &e2)) {
+        path = s1;
+        return true;
+    }
+    else if (ATmatch(e, "Derive(<str>, <str>, [<list>], <str>, [<list>])",
+                   &s1, &s2, &e1, &s3, &e2))
+    {
+        path = s3;
+        return true;
+    }
+    else if (ATmatch(e, "Include(<str>)", &s1))
+    {
+        string fn = queryFromStore(parseHash(s1));
+        return isFState(evalFile(fn), path);
+    }
+    else return false;
+}
+
+
+static Expr substExpr(string x, Expr rep, Expr e)
+{
+    char * s;
+    Expr e2;
+
+    if (ATmatch(e, "Var(<str>)", &s))
+        if (x == s)
+            return rep;
+        else
+            return e;
+
+    if (ATmatch(e, "Lam(<str>, <term>)", &s, &e2))
+        if (x == s)
+            return e;
+    /* !!! unfair substitutions */
+
+    /* Generically substitute in subterms. */
+
+    if (ATgetType(e) == AT_APPL) {
+        AFun fun = ATgetAFun(e);
+        int arity = ATgetArity(fun);
+        ATermList args = ATempty;
+
+        for (int i = arity - 1; i >= 0; i--)
+            args = ATinsert(args, substExpr(x, rep, ATgetArgument(e, i)));
+        
+        return (ATerm) ATmakeApplList(fun, args);
+    }
+
+    if (ATgetType(e) == AT_LIST) {
+        ATermList in = (ATermList) e;
+        ATermList out = ATempty;
+
+        while (!ATisEmpty(in)) {
+            out = ATinsert(out, substExpr(x, rep, ATgetFirst(in)));
+            in = ATgetNext(in);
+        }
+
+        return (ATerm) ATreverse(out);
+    }
+
+    throw badTerm("do not know how to substitute", e);
+}
+
+
+static Expr substExprMany(ATermList formals, ATermList args, Expr body)
+{
+    char * s;
+    Expr e;
+
+    /* !!! check args against formals */
+
+    while (!ATisEmpty(args)) {
+        ATerm tup = ATgetFirst(args);
+        if (!ATmatch(tup, "(<str>, <term>)", &s, &e))
+            throw badTerm("expected an argument tuple", tup);
+
+        body = substExpr(s, e, body);
+
+        args = ATgetNext(args);
+    }
+    
+    return body;
+}
+
+
+static Expr evalExpr(Expr e)
+{
+    char * s1;
+    Expr e1, e2, e3, e4;
+    ATermList bnds;
+
+    /* Normal forms. */
+    if (ATmatch(e, "<str>", &s1) ||
+        ATmatch(e, "Function([<list>], <term>)", &e1, &e2))
+        return e;
+
+    string dummy;
+    if (isFState(e, dummy)) return e;
+
+    /* Application. */
+    if (ATmatch(e, "App(<term>, [<list>])", &e1, &e2)) {
+        e1 = evalExpr(e1);
+        if (!ATmatch(e1, "Function([<list>], <term>)", &e3, &e4))
+            throw badTerm("expecting a function", e1);
+        return evalExpr(substExprMany((ATermList) e3, (ATermList) e2, e4));
+    }
+
+    /* Fix inclusion. */
+    if (ATmatch(e, "IncludeFix(<str>)", &s1)) {
+        string fileName(s1);
+        return evalFile(s1);
+    }
+
+    /* Relative files. */
+    if (ATmatch(e, "Relative(<str>)", &s1)) {
+        string srcPath = s1;
+        string dstPath;
+        Hash hash;
+        addToStore(srcPath, dstPath, hash);
+        return ATmake("Path(<str>, Hash(<str>), [])",
+            dstPath.c_str(), ((string) hash).c_str());
+    }
+
+    /* Packages are transformed into Derive fstate expressions. */
+    if (ATmatch(e, "Package([<list>])", &bnds)) {
+
+        /* Evaluate the bindings and put them in a map. */
+        map<string, ATerm> bndMap;
+        bndMap["platform"] = ATmake("<str>", SYSTEM);
+        while (!ATisEmpty(bnds)) {
+            ATerm bnd = ATgetFirst(bnds);
+            if (!ATmatch(bnd, "(<str>, <term>)", &s1, &e1))
+                throw badTerm("binding expected", bnd);
+            bndMap[s1] = evalExpr(e1);
+            bnds = ATgetNext(bnds);
+        }
+
+        /* Gather information for building the Derive expression. */
+        ATermList ins = ATempty, env = ATempty;
+        string builder, id;
+        bnds = ATempty;
+
+        for (map<string, ATerm>::iterator it = bndMap.begin();
+             it != bndMap.end(); it++)
+        {
+            string key = it->first;
+            ATerm value = it->second;
+
+            string path;
+            if (isFState(value, path)) {
+                ins = ATinsert(ins, value);
+                env = ATinsert(env, ATmake("(<str>, <str>)",
+                    key.c_str(), path.c_str()));
+                if (key == "build") builder = path;
+            }
+            else if (ATmatch(value, "<str>", &s1)) {
+                if (key == "id") id = s1;
+                env = ATinsert(env, 
+                    ATmake("(<str>, <str>)", key.c_str(), s1));
+            }
+            else throw badTerm("invalid package argument", value);
+
+            bnds = ATinsert(bnds, 
+                ATmake("(<str>, <term>)", key.c_str(), value));
+        }
+
+        /* Hash the normal form to produce a unique but deterministic
+           path name for this package. */
+        ATerm nf = ATmake("Package(<term>)", ATreverse(bnds));
+        debug(printTerm(nf));
+        Hash hash = hashTerm(nf);
+
+        if (builder == "")
+            throw badTerm("no builder specified", nf);
+        
+        if (id == "")
+            throw badTerm("no package identifier specified", nf);
+        
+        string out = nixStore + "/" + ((string) hash).c_str() + "-" + id;
+
+        env = ATinsert(env, ATmake("(<str>, <str>)", "out", out.c_str()));
+
+        /* Construct the result. */
+        e = ATmake("Derive(<str>, <str>, <term>, <str>, <term>)",
+            SYSTEM, builder.c_str(), ins, out.c_str(), env);
+        debug(printTerm(e));
+
+        /* Write the resulting term into the Nix store directory. */
+        Hash eHash = writeTerm(e);
+
+        return ATmake("Include(<str>)", ((string) eHash).c_str());
+    }
+
+    /* Barf. */
+    throw badTerm("invalid expression", e);
+}
+
+
+static Strings searchPath;
+
+
+static Expr evalFile(string fileName)
+{
+    Expr e = ATreadFromNamedFile(fileName.c_str());
+    if (!e) throw Error(format("cannot read aterm `%1%'") % fileName);
+    return evalExpr(e);
+}
+
+
+void run(Strings args)
+{
+    Strings files;
+
+    searchPath.push_back(".");
+    
+    for (Strings::iterator it = args.begin();
+         it != args.end(); )
+    {
+        string arg = *it++;
+
+        if (arg == "--includedir" || arg == "-I") {
+            if (it == args.end())
+                throw UsageError(format("argument required in `%1%'") % arg);
+            searchPath.push_back(*it++);
+        }
+        else if (arg[0] == '-')
+            throw UsageError(format("unknown flag `%1%`") % arg);
+        else
+            files.push_back(arg);
+    }
+
+    if (files.empty()) throw UsageError("no files specified");
+
+    for (Strings::iterator it = files.begin();
+         it != files.end(); it++)
+    {
+        Expr e = evalFile(*it);
+        char * s;
+        if (ATmatch(e, "Include(<str>)", &s)) {
+            cout << format("%1%\n") % s;
+        } 
+        else throw badTerm("top level is not a package", e);
+    }
+}
+
+
+string programId = "fix";
diff --git a/src/test.cc b/src/test.cc
index 639bd5ccf5..3851ef8676 100644
--- a/src/test.cc
+++ b/src/test.cc
@@ -120,17 +120,17 @@ void runTests()
         ATmake("Foo(123)"));
 
     string builder1fn = absPath("./test-builder-1.sh");
-    Hash builder1h = hashFile(builder1fn);
+    Hash builder1h = hashPath(builder1fn);
 
     string fn1 = nixValues + "/builder-1.sh";
-    Expr e1 = ATmake("File(<str>, ExtFile(<str>, <str>), [])", 
+    Expr e1 = ATmake("Path(<str>, ExtFile(<str>, <str>), [])", 
         fn1.c_str(),
         builder1h.c_str(),
         builder1fn.c_str());
     eval(fNormalise, e1);
 
     string fn2 = nixValues + "/refer.txt";
-    Expr e2 = ATmake("File(<str>, Regular(<str>), [<term>])",
+    Expr e2 = ATmake("Path(<str>, Regular(<str>), [<term>])",
         fn2.c_str(),
         ("I refer to " + fn1).c_str(),
         e1);
@@ -144,14 +144,14 @@ void runTests()
     addToStore("./test-builder-1.sh", builder1fn, builder1h);
 
     FState fs1 = ATmake(
-        "File(<str>, Hash(<str>), [])", 
+        "Path(<str>, Hash(<str>), [])", 
         builder1fn.c_str(),
         ((string) builder1h).c_str());
     realise(fs1);
     realise(fs1);
 
     FState fs2 = ATmake(
-        "File(<str>, Hash(<str>), [])", 
+        "Path(<str>, Hash(<str>), [])", 
         (builder1fn + "_bla").c_str(),
         ((string) builder1h).c_str());
     realise(fs2);
diff --git a/src/values.cc b/src/values.cc
index fe65b977ea..5db04036c4 100644
--- a/src/values.cc
+++ b/src/values.cc
@@ -34,7 +34,7 @@ struct CopySource : RestoreSource
 };
 
 
-void copyFile(string src, string dst)
+void copyPath(string src, string dst)
 {
     /* Unfortunately C++ doesn't support coprocedures, so we have no
        nice way to chain CopySink and CopySource together.  Instead we
@@ -99,7 +99,7 @@ void addToStore(string srcPath, string & dstPath, Hash & hash)
     string baseName = baseNameOf(srcPath);
     dstPath = nixStore + "/" + (string) hash + "-" + baseName;
 
-    copyFile(srcPath, dstPath);
+    copyPath(srcPath, dstPath);
 
     setDB(nixDB, dbRefs, hash, dstPath);
 }
diff --git a/src/values.hh b/src/values.hh
index 79ef48671f..b96fa30ba8 100644
--- a/src/values.hh
+++ b/src/values.hh
@@ -8,7 +8,7 @@
 using namespace std;
 
 
-void copyFile(string src, string dst);
+void copyPath(string src, string dst);
 
 /* Copy a file to the nixStore directory and register it in dbRefs.
    Return the hash code of the value. */