diff --git a/src/parser.js b/src/parser.js
index b0ce1769..6aac3d79 100644
--- a/src/parser.js
+++ b/src/parser.js
@@ -1202,6 +1202,7 @@ var Parser = Object.extend({
                                                                   data)]));
             }
             else if(tok.type === lexer.TOKEN_BLOCK_START) {
+                this.dropLeadingWhitespace = false;
                 var n = this.parseStatement();
                 if(!n) {
                     break;
@@ -1211,12 +1212,16 @@ var Parser = Object.extend({
             else if(tok.type === lexer.TOKEN_VARIABLE_START) {
                 var e = this.parseExpression();
                 this.advanceAfterVariableEnd();
+                this.dropLeadingWhitespace = false;
                 buf.push(new nodes.Output(tok.lineno, tok.colno, [e]));
             }
-            else if(tok.type !== lexer.TOKEN_COMMENT) {
+            else if(tok.type === lexer.TOKEN_COMMENT) {
+              this.dropLeadingWhitespace = false;
+            } else {
                 // Ignore comments, otherwise this should be an error
                 this.fail('Unexpected token at top-level: ' +
                                 tok.type, tok.lineno, tok.colno);
+
             }
         }
 
diff --git a/tests/compiler.js b/tests/compiler.js
index d3959e58..5f6b3d21 100644
--- a/tests/compiler.js
+++ b/tests/compiler.js
@@ -1223,5 +1223,25 @@
             finish(done);
         });
 
+
+        it('should control whitespaces correctly', function(done) {
+            equal(
+              '{% if true -%}{{"hello"}} {{"world"}}{% endif %}',
+              'hello world'
+            );
+
+            equal(
+              '{% if true -%}{% if true %} {{"hello"}} {{"world"}}'
+                + '{% endif %}{% endif %}',
+              ' hello world'
+            );
+
+            equal(
+              '{% if true -%}{# comment #} {{"hello"}}{% endif %}',
+              ' hello'
+            );
+
+            finish(done);
+        });
     });
 })();
diff --git a/tests/parser.js b/tests/parser.js
index 0427902e..4bb9bf9e 100644
--- a/tests/parser.js
+++ b/tests/parser.js
@@ -583,6 +583,46 @@
                      [nodes.Symbol, 'y']]],
                    [nodes.Output,
                     [nodes.TemplateData, 'hi \n']]]);
+
+            isAST(parser.parse('{% if x -%}{{y}} {{z}}{% endif %}'),
+                  [nodes.Root,
+                   [nodes.If,
+                    [nodes.Symbol, 'x'],
+                    [nodes.NodeList,
+                     [nodes.Output,
+                      [nodes.Symbol, 'y']],
+                     [nodes.Output,
+                      // the value of TemplateData should be ' ' instead of ''
+                      [nodes.TemplateData, ' ']],
+                     [nodes.Output,
+                      [nodes.Symbol, 'z']]]]]);
+
+            isAST(parser.parse('{% if x -%}{% if y %} {{z}}{% endif %}{% endif %}'),
+                [nodes.Root,
+                 [nodes.If,
+                  [nodes.Symbol, 'x'],
+                  [nodes.NodeList,
+                   [nodes.If,
+                    [nodes.Symbol, 'y'],
+                    [nodes.NodeList,
+                      [nodes.Output,
+                        // the value of TemplateData should be ' ' instead of ''
+                       [nodes.TemplateData, ' ']],
+                      [nodes.Output,
+                       [nodes.Symbol, 'z']]
+                      ]]]]]);
+
+            isAST(parser.parse('{% if x -%}{# comment #} {{z}}{% endif %}'),
+                 [nodes.Root,
+                  [nodes.If,
+                   [nodes.Symbol, 'x'],
+                   [nodes.NodeList,
+                    [nodes.Output,
+                     // the value of TemplateData should be ' ' instead of ''
+                     [nodes.TemplateData, ' ']],
+                    [nodes.Output,
+                     [nodes.Symbol, 'z']]]]]);
+
         });
 
         it('should throw errors', function() {