diff --git a/rxjava-core/src/main/java/rx/subjects/BehaviorSubject.java b/rxjava-core/src/main/java/rx/subjects/BehaviorSubject.java
new file mode 100644
index 0000000000..eb7c655414
--- /dev/null
+++ b/rxjava-core/src/main/java/rx/subjects/BehaviorSubject.java
@@ -0,0 +1,264 @@
+/**
+ * Copyright 2013 Netflix, Inc.
+ * 
+ * Licensed under the Apache License, Version 2.0 (the "License");
+ * you may not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ * 
+ * http://www.apache.org/licenses/LICENSE-2.0
+ * 
+ * Unless required by applicable law or agreed to in writing, software
+ * distributed under the License is distributed on an "AS IS" BASIS,
+ * WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+ * See the License for the specific language governing permissions and
+ * limitations under the License.
+ */
+package rx.subjects;
+
+import static org.mockito.Matchers.*;
+import static org.mockito.Mockito.*;
+
+import java.util.concurrent.ConcurrentHashMap;
+import java.util.concurrent.atomic.AtomicReference;
+
+import org.junit.Test;
+import org.mockito.Mockito;
+
+import rx.Observer;
+import rx.Subscription;
+import rx.util.AtomicObservableSubscription;
+import rx.util.SynchronizedObserver;
+import rx.util.functions.Action1;
+import rx.util.functions.Func0;
+import rx.util.functions.Func1;
+
+/**
+ * Subject that publishes the last and all subsequent events to each {@link Observer} that subscribes. 
+ * <p>
+ * Example usage:
+ * <p>
+ * <pre> {@code
+ 
+  // observer will receive all events.
+  BehaviorSubject<Object> subject = BehaviorSubject.createWithDefaultValue("default");
+  subject.subscribe(observer);
+  subject.onNext("one");
+  subject.onNext("two");
+  subject.onNext("three");
+ 
+  // observer will receive the "one", "two" and "three" events.
+  BehaviorSubject<Object> subject = BehaviorSubject.createWithDefaultValue("default");
+  subject.onNext("one");
+  subject.subscribe(observer);
+  subject.onNext("two");
+  subject.onNext("three");
+ 
+  } </pre>
+ * 
+ * @param <T>
+ */
+public class BehaviorSubject<T> extends Subject<T, T> {
+
+    /**
+     * Creates a {@link BehaviorSubject} which publishes the last and all subsequent events to each 
+     * {@link Observer} that subscribes to it.
+     *  
+     * @param defaultValue
+     *            The value which will be published to any {@link Observer} as long as the 
+     *            {@link BehaviorSubject} has not yet received any events.
+     * @return the constructed {@link BehaviorSubject}.
+     */
+    public static <T> BehaviorSubject<T> createWithDefaultValue(T defaultValue) {
+        final ConcurrentHashMap<Subscription, Observer<T>> observers = new ConcurrentHashMap<Subscription, Observer<T>>();
+
+        final AtomicReference<T> currentValue = new AtomicReference<T>(defaultValue);
+        
+        Func1<Observer<T>, Subscription> onSubscribe = new Func1<Observer<T>, Subscription>() {
+            @Override
+            public Subscription call(Observer<T> observer) {
+                final AtomicObservableSubscription subscription = new AtomicObservableSubscription();
+
+                subscription.wrap(new Subscription() {
+                    @Override
+                    public void unsubscribe() {
+                        // on unsubscribe remove it from the map of outbound observers to notify
+                        observers.remove(subscription);
+                    }
+                });
+
+                SynchronizedObserver<T> synchronizedObserver = new SynchronizedObserver<T>(observer, subscription);
+                synchronizedObserver.onNext(currentValue.get());
+
+                // on subscribe add it to the map of outbound observers to notify
+                observers.put(subscription, synchronizedObserver);
+                return subscription;
+            }
+        };
+
+        return new BehaviorSubject<T>(currentValue, onSubscribe, observers);
+    }
+
+    private final ConcurrentHashMap<Subscription, Observer<T>> observers;
+    private final AtomicReference<T> currentValue;
+
+    protected BehaviorSubject(AtomicReference<T> currentValue, Func1<Observer<T>, Subscription> onSubscribe, ConcurrentHashMap<Subscription, Observer<T>> observers) {
+        super(onSubscribe);
+        this.currentValue = currentValue;
+        this.observers = observers;
+    }
+    
+    @Override
+    public void onCompleted() {
+        for (Observer<T> observer : observers.values()) {
+            observer.onCompleted();
+        }
+    }
+
+    @Override
+    public void onError(Exception e) {
+        for (Observer<T> observer : observers.values()) {
+            observer.onError(e);
+        }
+    }
+
+    @Override
+    public void onNext(T args) {
+        currentValue.set(args);
+        for (Observer<T> observer : observers.values()) {
+            observer.onNext(args);
+        }
+    }
+
+    public static class UnitTest {
+
+        private final Exception testException = new Exception();
+
+        @Test
+        public void testThatObserverReceivesDefaultValueIfNothingWasPublished() {
+            BehaviorSubject<String> subject = BehaviorSubject.createWithDefaultValue("default");
+
+            @SuppressWarnings("unchecked")
+            Observer<String> aObserver = mock(Observer.class);
+            subject.subscribe(aObserver);
+
+            subject.onNext("one");
+            subject.onNext("two");
+            subject.onNext("three");
+
+            assertReceivedAllEvents(aObserver);
+        }
+
+        private void assertReceivedAllEvents(Observer<String> aObserver) {
+            verify(aObserver, times(1)).onNext("default");
+            verify(aObserver, times(1)).onNext("one");
+            verify(aObserver, times(1)).onNext("two");
+            verify(aObserver, times(1)).onNext("three");
+            verify(aObserver, Mockito.never()).onError(testException);
+            verify(aObserver, Mockito.never()).onCompleted();
+        }
+
+        @Test
+        public void testThatObserverDoesNotReceiveDefaultValueIfSomethingWasPublished() {
+            BehaviorSubject<String> subject = BehaviorSubject.createWithDefaultValue("default");
+
+            subject.onNext("one");
+
+            @SuppressWarnings("unchecked")
+            Observer<String> aObserver = mock(Observer.class);
+            subject.subscribe(aObserver);
+
+            subject.onNext("two");
+            subject.onNext("three");
+
+            assertDidNotReceiveTheDefaultValue(aObserver);
+        }
+
+        private void assertDidNotReceiveTheDefaultValue(Observer<String> aObserver) {
+            verify(aObserver, Mockito.never()).onNext("default");
+            verify(aObserver, times(1)).onNext("one");
+            verify(aObserver, times(1)).onNext("two");
+            verify(aObserver, times(1)).onNext("three");
+            verify(aObserver, Mockito.never()).onError(testException);
+            verify(aObserver, Mockito.never()).onCompleted();
+        }
+
+        @Test
+        public void testCompleted() {
+            BehaviorSubject<String> subject = BehaviorSubject.createWithDefaultValue("default");
+
+            @SuppressWarnings("unchecked")
+            Observer<String> aObserver = mock(Observer.class);
+            subject.subscribe(aObserver);
+
+            subject.onNext("one");
+            subject.onCompleted();
+
+            assertCompletedObserver(aObserver);
+        }
+
+        private void assertCompletedObserver(Observer<String> aObserver)
+        {
+            verify(aObserver, times(1)).onNext("default");
+            verify(aObserver, times(1)).onNext("one");
+            verify(aObserver, Mockito.never()).onError(any(Exception.class));
+            verify(aObserver, times(1)).onCompleted();
+        }
+
+        @Test
+        public void testCompletedAfterError() {
+            BehaviorSubject<String> subject = BehaviorSubject.createWithDefaultValue("default");
+
+            @SuppressWarnings("unchecked")
+            Observer<String> aObserver = mock(Observer.class);
+            subject.subscribe(aObserver);
+
+            subject.onNext("one");
+            subject.onError(testException);
+            subject.onNext("two");
+            subject.onCompleted();
+
+            assertErrorObserver(aObserver);
+        }
+
+        private void assertErrorObserver(Observer<String> aObserver)
+        {
+            verify(aObserver, times(1)).onNext("default");
+            verify(aObserver, times(1)).onNext("one");
+            verify(aObserver, times(1)).onError(testException);
+        }
+        
+        @Test
+        public void testUnsubscribe()
+        {
+            UnsubscribeTester.test(new Func0<BehaviorSubject<String>>()
+            {
+                @Override
+                public BehaviorSubject<String> call()
+                {
+                    return BehaviorSubject.createWithDefaultValue("default");
+                }
+            }, new Action1<BehaviorSubject<String>>()
+            {
+                @Override
+                public void call(BehaviorSubject<String> DefaultSubject)
+                {
+                    DefaultSubject.onCompleted();
+                }
+            }, new Action1<BehaviorSubject<String>>()
+            {
+                @Override
+                public void call(BehaviorSubject<String> DefaultSubject)
+                {
+                    DefaultSubject.onError(new Exception());
+                }
+            }, new Action1<BehaviorSubject<String>>()
+            {
+                @Override
+                public void call(BehaviorSubject<String> DefaultSubject)
+                {
+                    DefaultSubject.onNext("one");
+                }
+            });
+        }
+    }
+}