diff --git a/lib/compiler.js b/lib/compiler.js
index 70459ab..3c89be0 100644
--- a/lib/compiler.js
+++ b/lib/compiler.js
@@ -85,8 +85,9 @@ module.exports = function compile(options) {
     modelsRootDir, modelsConfig, modelSources);
 
   var mixinDirs = options.mixinDirs || [];
+  var mixinSources = options.mixinSources || modelsMeta.mixins || ['./mixins'];
   var mixinInstructions = buildAllMixinInstructions(
-    appRootDir, mixinDirs, options);
+    appRootDir, mixinDirs, mixinSources, options, modelInstructions);
 
   // When executor passes the instruction to loopback methods,
   // loopback modifies the data. Since we are loading the data using `require`,
@@ -606,12 +607,48 @@ function resolveAppScriptPath(rootDir, relativePath, resolveOptions) {
   return (fixedFile === undefined ? resolvedPath : fixedFile);
 }
 
-function buildAllMixinInstructions(appRootDir, mixinDirs, options) {
+function buildAllMixinInstructions(appRootDir, mixinDirs, mixinSources, options,
+  modelInstructions) {
   var extensions = _.without(_.keys(require.extensions),
     _.keys(getExcludedExtensions()));
-  var files = options.mixins || [];
 
-  mixinDirs.forEach(function(dir) {
+  // load mixins from `options.mixins`
+  var sourceFiles = options.mixins || [];
+  var instructionsFromMixins = loadMixins(sourceFiles, options);
+
+  // load mixins from `options.mixinDirs`
+  sourceFiles = findMixinDefinitions(appRootDir, mixinDirs, extensions);
+  if (sourceFiles === undefined) return;
+  var instructionsFromMixinDirs = loadMixins(sourceFiles, options);
+
+  /* If `mixinDirs` and `mixinSources` have any directories in common,
+   * then remove the common directories from `mixinSources` */
+  mixinSources = _.difference(mixinSources, mixinDirs);
+
+  // load mixins from `options.mixinSources`
+  sourceFiles = findMixinDefinitions(appRootDir, mixinSources, extensions);
+  if (sourceFiles === undefined) return;
+  var instructionsFromMixinSources = loadMixins(sourceFiles, options);
+
+  // Fetch unique list of mixin names, used in models
+  var modelMixins = fetchMixinNamesUsedInModelInstructions(modelInstructions);
+  modelMixins = _.unique(modelMixins);
+
+  // Filter-in only mixins, that are used in models
+  instructionsFromMixinSources = filterMixinInstructionsUsingWhitelist(
+    instructionsFromMixinSources, modelMixins);
+
+  var mixins = _.assign(
+    instructionsFromMixins,
+    instructionsFromMixinDirs,
+    instructionsFromMixinSources);
+
+  return _.values(mixins);
+}
+
+function findMixinDefinitions(appRootDir, sourceDirs, extensions) {
+  var files = [];
+  sourceDirs.forEach(function(dir) {
     dir = tryResolveAppPath(appRootDir, dir);
     if (!dir) {
       debug('Skipping unknown module source dir %j', dir);
@@ -619,8 +656,12 @@ function buildAllMixinInstructions(appRootDir, mixinDirs, options) {
     }
     files = files.concat(findScripts(dir, extensions));
   });
+  return files;
+}
 
-  var mixins = files.map(function(filepath) {
+function loadMixins(sourceFiles, options) {
+  var mixinInstructions = {};
+  sourceFiles.forEach(function(filepath) {
     var dir = path.dirname(filepath);
     var ext = path.extname(filepath);
     var name = path.basename(filepath, ext);
@@ -634,10 +675,31 @@ function buildAllMixinInstructions(appRootDir, mixinDirs, options) {
       _.extend(meta, require(metafile));
     }
     meta.sourceFile = filepath;
-    return meta;
+    mixinInstructions[meta.name] = meta;
   });
 
-  return mixins;
+  return mixinInstructions;
+}
+
+function fetchMixinNamesUsedInModelInstructions(modelInstructions) {
+  return _.flatten(modelInstructions
+  .map(function(model) {
+    return model.definition && model.definition.mixins ?
+      Object.keys(model.definition.mixins) : [];
+  }));
+}
+
+function filterMixinInstructionsUsingWhitelist(instructions, includeMixins) {
+  var instructionKeys = Object.keys(instructions);
+  includeMixins = _.intersection(instructionKeys, includeMixins);
+
+  var filteredInstructions = {};
+  instructionKeys.forEach(function(mixinName) {
+    if (includeMixins.indexOf(mixinName) !== -1) {
+      filteredInstructions[mixinName] = instructions[mixinName];
+    }
+  });
+  return filteredInstructions;
 }
 
 function normalizeMixinName(str, options) {
diff --git a/test/browser.test.js b/test/browser.test.js
index 8a92f5a..44e0b7a 100644
--- a/test/browser.test.js
+++ b/test/browser.test.js
@@ -64,8 +64,7 @@ describe('browser support', function() {
   it('loads mixins', function(done) {
     var appDir = path.resolve(__dirname, './fixtures/browser-app');
     var options = {
-      appRootDir: appDir,
-      mixinDirs: ['./mixins']
+      appRootDir: appDir
     };
 
     browserifyTestApp(options, function(err, bundlePath) {
diff --git a/test/compiler.test.js b/test/compiler.test.js
index 9ed42e3..1b47db1 100644
--- a/test/compiler.test.js
+++ b/test/compiler.test.js
@@ -1016,41 +1016,175 @@ describe('compiler', function() {
     });
 
     describe('for mixins', function() {
-      function verifyMixinIsFoundViaMixinDirs(sourceFile, mixinDirs) {
-        var appJS = appdir.writeFileSync(sourceFile, '');
+      describe(' - mixinDirs', function() {
+        function verifyMixinIsFoundViaMixinDirs(sourceFile, mixinDirs) {
+          var appJS = appdir.writeFileSync(sourceFile, '');
 
-        var instructions = boot.compile({
-          appRootDir: appdir.PATH,
-          mixinDirs: mixinDirs
+          var instructions = boot.compile({
+            appRootDir: appdir.PATH,
+            mixinDirs: mixinDirs
+          });
+
+          expect(instructions.mixins[0].sourceFile).to.eql(appJS);
+        }
+
+        it('supports `mixinDirs` option', function() {
+          verifyMixinIsFoundViaMixinDirs('custom-mixins/other.js',
+            ['./custom-mixins']);
         });
 
-        expect(instructions.mixins[0].sourceFile).to.eql(appJS);
-      }
+        it('resolves relative path in `mixinDirs` option', function() {
+          verifyMixinIsFoundViaMixinDirs('custom-mixins/other.js',
+            ['./custom-mixins']);
+        });
 
-      it('supports `mixinDirs` option', function() {
-        verifyMixinIsFoundViaMixinDirs('mixins/other.js', ['./mixins']);
+        it('resolves module relative path in `mixinDirs` option', function() {
+          verifyMixinIsFoundViaMixinDirs('node_modules/custom-mixins/other.js',
+            ['custom-mixins']);
+        });
       });
 
-      it('resolves relative path in `mixinDirs` option', function() {
-        verifyMixinIsFoundViaMixinDirs('custom-mixins/vehicle.js',
-          ['./custom-mixins']);
-      });
+      describe(' - mixinSources', function() {
+        beforeEach(function() {
+          appdir.createConfigFilesSync({}, {}, {
+            Car: { dataSource: 'db' }
+          });
+          appdir.writeConfigFileSync('models/car.json', {
+            name: 'Car',
+            mixins: {'TimeStamps': {} }
+          });
+        });
+
+        function verifyMixinIsFoundViaMixinSources(sourceFile, mixinSources) {
+          var appJS = appdir.writeFileSync(sourceFile, '');
+
+          var instructions = boot.compile({
+            appRootDir: appdir.PATH,
+            mixinSources: mixinSources
+          });
+
+          expect(instructions.mixins[0].sourceFile).to.eql(appJS);
+        }
+
+        it('supports `mixinSources` option', function() {
+          verifyMixinIsFoundViaMixinSources('mixins/time-stamps.js',
+            ['./mixins']);
+        });
+
+        it('resolves relative path in `mixinSources` option', function() {
+          verifyMixinIsFoundViaMixinSources('custom-mixins/time-stamps.js',
+            ['./custom-mixins']);
+        });
+
+        it('resolves module relative path in `mixinSources` option',
+          function() {
+          verifyMixinIsFoundViaMixinSources(
+            'node_modules/custom-mixins/time-stamps.js',
+            ['custom-mixins']);
+        });
+
+        it('supports `mixins` option in `model-config.json`', function() {
+          appdir.createConfigFilesSync({}, {}, {
+            _meta: {
+              mixins: ['./custom-mixins']
+            },
+            Car: {
+              dataSource: 'db'
+            }
+          });
+
+          var appJS = appdir.writeFileSync('custom-mixins/time-stamps.js', '');
+          var instructions = boot.compile(appdir.PATH);
+          expect(instructions.mixins[0].sourceFile).to.eql(appJS);
+        });
 
-      it('resolves module relative path in `mixinDirs` option', function() {
-        verifyMixinIsFoundViaMixinDirs('node_modules/custom-mixins/vehicle.js',
-          ['custom-mixins']);
+        it('sets by default `mixinSources` to `mixins` directory', function() {
+          var appJS = appdir.writeFileSync('mixins/time-stamps.js', '');
+          var instructions = boot.compile(appdir.PATH);
+          expect(instructions.mixins[0].sourceFile).to.eql(appJS);
+        });
+
+        it('loads only mixins used by models', function() {
+          var appJS = appdir.writeFileSync('mixins/time-stamps.js', '');
+          appdir.writeFileSync('mixins/foo.js', '');
+
+          var instructions = boot.compile(appdir.PATH);
+          expect(instructions.mixins).to.have.length(1);
+          expect(instructions.mixins[0].sourceFile).to.eql(appJS);
+        });
+
+        it('loads mixins from model using mixin name in JSON file', function() {
+          var appJS = appdir.writeFileSync('mixins/time-stamps.js', '');
+          appdir.writeConfigFileSync('mixins/time-stamps.json', {
+            name: 'Timestamping'
+          });
+
+          appdir.writeConfigFileSync('models/car.json', {
+            name: 'Car',
+            mixins: {'Timestamping': {} }
+          });
+
+          var instructions = boot.compile(appdir.PATH);
+          expect(instructions.mixins).to.have.length(1);
+          expect(instructions.mixins[0].sourceFile).to.eql(appJS);
+        });
+
+        it('loads mixin only once for dirs common to mixinDirs & mixinSources',
+          function() {
+          var appJS = appdir.writeFileSync('custom-mixins/time-stamps.js', '');
+
+          var options = {
+            appRootDir: appdir.PATH,
+            mixinDirs: ['./custom-mixins'],
+            mixinSources: ['./custom-mixins']
+          };
+
+          var instructions = boot.compile(options);
+          expect(instructions.mixins).to.have.length(1);
+          expect(instructions.mixins[0].sourceFile).to.eql(appJS);
+        });
+
+        it('loads mixin from mixinSources, when it is also found in mixinDirs',
+          function() {
+          appdir.writeFileSync('mixinDir/time-stamps.js', '');
+          var appJS = appdir.writeFileSync('mixinSource/time-stamps.js', '');
+
+          var options = {
+            appRootDir: appdir.PATH,
+            mixinDirs: ['./mixinDir'],
+            mixinSources: ['./mixinSource']
+          };
+
+          var instructions = boot.compile(options);
+          expect(instructions.mixins).to.have.length(1);
+          expect(instructions.mixins[0].sourceFile).to.eql(appJS);
+        });
+
+        it('loads mixin from the most recent mixin definition', function() {
+          appdir.writeFileSync('mixins1/time-stamps.js', '');
+          var mixins2 = appdir.writeFileSync('mixins2/time-stamps.js', '');
+
+          var options = {
+            appRootDir: appdir.PATH,
+            mixinSources: ['./mixins1', './mixins2']
+          };
+
+          var instructions = boot.compile(options);
+          expect(instructions.mixins).to.have.length(1);
+          expect(instructions.mixins[0].sourceFile).to.eql(mixins2);
+        });
       });
 
       describe('name normalization', function() {
         var options;
         beforeEach(function() {
-          options = { appRootDir: appdir.PATH, mixinDirs: ['./mixins'] };
+          options = { appRootDir: appdir.PATH, mixinDirs: ['./custom-mixins'] };
 
-          appdir.writeFileSync('mixins/foo.js', '');
-          appdir.writeFileSync('mixins/time-stamps.js', '');
-          appdir.writeFileSync('mixins/camelCase.js', '');
-          appdir.writeFileSync('mixins/PascalCase.js', '');
-          appdir.writeFileSync('mixins/space name.js', '');
+          appdir.writeFileSync('custom-mixins/foo.js', '');
+          appdir.writeFileSync('custom-mixins/time-stamps.js', '');
+          appdir.writeFileSync('custom-mixins/camelCase.js', '');
+          appdir.writeFileSync('custom-mixins/PascalCase.js', '');
+          appdir.writeFileSync('custom-mixins/space name.js', '');
         });
 
         it('supports classify', function() {
@@ -1146,15 +1280,15 @@ describe('compiler', function() {
       });
 
       it('extends definition from JSON with same file name', function() {
-        var appJS = appdir.writeFileSync('mixins/foo-bar.js', '');
+        var appJS = appdir.writeFileSync('custom-mixins/foo-bar.js', '');
 
-        appdir.writeConfigFileSync('mixins/foo-bar.json', {
+        appdir.writeConfigFileSync('custom-mixins/foo-bar.json', {
           description: 'JSON file name same as JS file name' });
-        appdir.writeConfigFileSync('mixins/FooBar.json', {
+        appdir.writeConfigFileSync('custom-mixins/FooBar.json', {
           description: 'JSON file name same as normalized name of mixin' });
 
         var options = { appRootDir: appdir.PATH,
-          mixinDirs: ['./mixins'],
+          mixinDirs: ['./custom-mixins'],
           normalization: 'classify' };
         var instructions = boot.compile(options);
 
@@ -1166,7 +1300,6 @@ describe('compiler', function() {
           }
         ]);
       });
-
     });
   });
 
diff --git a/test/executor.test.js b/test/executor.test.js
index 850e46e..997c253 100644
--- a/test/executor.test.js
+++ b/test/executor.test.js
@@ -293,28 +293,39 @@ describe('executor', function() {
     });
 
     describe ('for mixins', function() {
-      it('defines mixins from instructions', function() {
-        appdir.writeFileSync('mixins/example.js',
+      var options;
+      beforeEach(function() {
+        appdir.writeFileSync('custom-mixins/example.js',
           'module.exports = ' +
           'function(Model, options) {}');
 
-        appdir.writeFileSync('mixins/time-stamps.js',
+        appdir.writeFileSync('custom-mixins/time-stamps.js',
           'module.exports = ' +
           'function(Model, options) {}');
 
-        appdir.writeConfigFileSync('mixins/time-stamps.json', {
+        appdir.writeConfigFileSync('custom-mixins/time-stamps.json', {
           name: 'Timestamping'
         });
 
-        var options = {
-          appRootDir: appdir.PATH,
-          mixinDirs: ['./mixins']
+        options = {
+          appRootDir: appdir.PATH
         };
+      });
 
+      it('defines mixins from instructions - using `mixinDirs`', function() {
+        options.mixinDirs = ['./custom-mixins'];
         boot(app, options);
 
         var modelBuilder = app.registry.modelBuilder;
+        var registry = modelBuilder.mixins.mixins;
+        expect(Object.keys(registry)).to.eql(['Example', 'Timestamping']);
+      });
 
+      it('defines mixins from instructions - using `mixinSources`', function() {
+        options.mixinSources = ['./custom-mixins'];
+        boot(app, options);
+
+        var modelBuilder = app.registry.modelBuilder;
         var registry = modelBuilder.mixins.mixins;
         expect(Object.keys(registry)).to.eql(['Example', 'Timestamping']);
       });