diff --git a/lib/template.dart b/lib/template.dart
index aa8a7a8..32736d0 100644
--- a/lib/template.dart
+++ b/lib/template.dart
@@ -95,11 +95,12 @@
 	_Renderer(this._root,
 	    this._sink,
 	    this._values,
-	    this._stack,
+	    List stack,
 	    this._lenient,
 	    this._htmlEscapeValues,
 	    this._partialResolver,
-	    this._templateName);
+	    this._templateName)
+    : _stack = new List.from(stack); 
 	
 	_Renderer.partial(_Renderer renderer, _Template partial)
       : this(partial._root,
@@ -111,6 +112,16 @@
           renderer._partialResolver,
           renderer._templateName);
 
+	 _Renderer.subtree(_Renderer renderer, _Node node, StringSink sink)
+       : this(node,
+           sink,
+           renderer._values,
+           renderer._stack,
+           renderer._lenient,
+           renderer._htmlEscapeValues,
+           renderer._partialResolver,
+           renderer._templateName);
+	
 	final _Node _root;
   final StringSink _sink;
   final _values;
@@ -179,7 +190,7 @@
 		}
 		return object;
 	}
-
+	
 	// Returns the property of the given object by name. For a map,
 	// which contains the key name, this is object[name]. For other
 	// objects, this is object.name or object.name(). If no property
@@ -213,7 +224,10 @@
 	}
 
 	_renderVariable(node, {bool escape : true}) {
-		final value = _resolveValue(node.value);
+		var value = _resolveValue(node.value);
+		
+		if (value is Function) value = value('');
+		
 		if (value == _NO_SUCH_PROPERTY) {
 			if (!_lenient)
 				throw new MustacheFormatException(
@@ -234,23 +248,41 @@
 		_stack.removeLast();
 	}
 
+	String _renderSubtree(node) {
+	  var sink = new StringBuffer();
+	  var renderer = new _Renderer.subtree(this, node, sink);
+	  renderer.render();
+	  return sink.toString();
+	}
+	
 	_renderSection(node) {
-		final value = _resolveValue(node.value);
+		var value = _resolveValue(node.value);
+    
 		if (value == null) {
 			// Do nothing.
+		
 		} else if (value is Iterable) {
 			value.forEach((v) => _renderSectionWithValue(node, v));
+		
 		} else if (value is Map) {
 			_renderSectionWithValue(node, value);
+		
 		} else if (value == true) {
 			_renderSectionWithValue(node, value);
+		
 		} else if (value == false) {
 			// Do nothing.
+		
 		} else if (value == _NO_SUCH_PROPERTY) {
 			if (!_lenient)
 				throw new MustacheFormatException(
 				  'Value was missing, section: ${node.value}',
 					_templateName, node.line, node.column);
+		
+		} else if (value is Function) {
+         var output = _renderSubtree(node);
+         _write(value(output));
+		
 		} else {
 			throw new MustacheFormatException(
 			  'Invalid value type for section, '
@@ -261,13 +293,17 @@
 	}
 
 	_renderInvSection(node) {
-		final value = _resolveValue(node.value);
+		var value = _resolveValue(node.value);
+    
 		if (value == null) {
 			_renderSectionWithValue(node, null);
+		
 		} else if ((value is Iterable && value.isEmpty) || value == false) {
 			_renderSectionWithValue(node, value);
+		
 		} else if (value == true || value is Map || value is Iterable) {
 			// Do nothing.
+		
 		} else if (value == _NO_SUCH_PROPERTY) {
 			if (_lenient) {
 				_renderSectionWithValue(node, null);
@@ -276,6 +312,15 @@
 				    'Value was missing, inverse-section: ${node.value}',
 				    _templateName, node.line, node.column);
 			}
+    
+		} else if (value is Function) {
+      var output = _renderSubtree(node);
+      if (value(output) != false) {
+        // FIXME not sure what to output here, result of function or template 
+        // output?
+        _write(output);
+      }
+
 		} else {
 			throw new MustacheFormatException(
 			  'Invalid value type for inverse section, '
diff --git a/test/mustache_test.dart b/test/mustache_test.dart
index 94dae11..55df9da 100644
--- a/test/mustache_test.dart
+++ b/test/mustache_test.dart
@@ -311,6 +311,41 @@
     
 	});
 
+  group('Lambdas', () {
+    
+    _lambdaTest({template, lambda, output}) =>
+        expect(parse(template).renderString({'lambda': lambda}), equals(output));
+    
+    test('basic', () {
+      _lambdaTest(
+          template: 'Hello, {{lambda}}!',
+          lambda: (_) => 'world',
+          output: 'Hello, world!');
+    });
+
+    test('escaping', () {
+      _lambdaTest(
+          template: '<{{lambda}}{{{lambda}}}',
+          lambda: (_) => '>',
+          output: '<&gt;>');
+    });
+
+    test('sections', () {
+      _lambdaTest(
+          template: '{{#lambda}}FILE{{/lambda}} != {{#lambda}}LINE{{/lambda}}',
+          lambda: (s) => '__${s}__',
+          output: '__FILE__ != __LINE__');
+    });
+
+    test('inverted sections truthy', () {
+      var template = '<{{^lambda}}{{static}}{{/lambda}}>';
+      var values = {'lambda': (_) => false, 'static': 'static'};
+      var output = '<>';
+      expect(parse(template).renderString(values), equals(output));
+    });
+        
+  });
+	
 	group('Other', () {
 		test('Standalone line', () {
 			var val = parse('|\n{{#bob}}\n{{/bob}}\n|').renderString({'bob': []});