diff --git a/app/helpers/markdownify_helper.rb b/app/helpers/markdownify_helper.rb
index ef38d352d..19f6aa850 100644
--- a/app/helpers/markdownify_helper.rb
+++ b/app/helpers/markdownify_helper.rb
@@ -7,7 +7,9 @@ require 'lib/diaspora/markdownify'
 module MarkdownifyHelper
   def markdownify(message, render_options={})
     markdown_options = {
-      :autolink => true,
+      :autolink            => true,
+      :fenced_code_blocks  => true,
+      :space_after_headers => true
     }
 
     render_options[:filter_html] = true
diff --git a/app/views/status_messages/_status_message.haml b/app/views/status_messages/_status_message.haml
index 133cde0b5..c3be5bad9 100644
--- a/app/views/status_messages/_status_message.haml
+++ b/app/views/status_messages/_status_message.haml
@@ -16,4 +16,4 @@
           = link_to (image_tag photo.url(:thumb_small), :class => 'stream-photo thumb_small', 'data-small-photo' => photo.url(:thumb_medium), 'data-full-photo' => photo.url), photo_path(photo), :class => 'stream-photo-link'
 
 %p{:class => direction_for(post.text)}
-  = markdownify(post.text, :youtube_maps => post[:youtube_titles])
+  != markdownify(post.text, :youtube_maps => post[:youtube_titles])
diff --git a/lib/diaspora/markdownify.rb b/lib/diaspora/markdownify.rb
index 734e34f01..49c7665f1 100644
--- a/lib/diaspora/markdownify.rb
+++ b/lib/diaspora/markdownify.rb
@@ -1,3 +1,4 @@
+require 'erb'
 require 'uri'
 
 module Diaspora
@@ -36,13 +37,14 @@ module Diaspora
         if link =~ regex
           video_id = $1
           if @vimeo_maps[video_id]
-            title = h(CGI::unescape(@vimeo_maps[video_id]))
+            title = ERB::Util.h(CGI::unescape(@vimeo_maps[video_id]))
           else
             title = I18n.t 'application.helper.video_title.unknown'
           end
           return ' <a class="video-link" data-host="vimeo.com" data-video-id="' + 
             video_id + '" href="' + link + '" target="_blank">Vimeo: ' + title + '</a>'
         end
+        return
       end
 
       def autolink_youtube(link)
@@ -51,7 +53,7 @@ module Diaspora
           anchor = $2 || ''
 
           if @youtube_maps[video_id]
-            title = h(CGI::unescape(@youtube_maps[video_id]))
+            title = ERB::Util.h(CGI::unescape(@youtube_maps[video_id]))
           else
             title = I18n.t 'application.helper.video_title.unknown'
           end
@@ -59,6 +61,11 @@ module Diaspora
             video_id + '" data-anchor="' + anchor + 
             '" href="'+ link + '" target="_blank">Youtube: ' + title + '</a>'
         end
+        return
+      end
+
+      def block_code(text, language)
+        "<pre><code>\n#{text}</code></pre>"
       end
 
       def double_emphasis(text)
@@ -95,10 +102,19 @@ module Diaspora
           text =  Diaspora::Taggable.format_tags(text, :no_escape => true)
         end
 
+        if @newlines
+          br = linebreak
+
+          # in very clear cases, let newlines become <br /> tags
+          # Grabbed from Github flavored Markdown
+          text = text.gsub(/^[\w\<][^\n]*\n+/) do |x|
+            x =~ /\n{2}/ ? x : (x = x.strip; x << br)
+          end
+        end
+
         return "<p>#{text}</p>"
       end
 
-
       def preprocess(full_document)
         if @specialchars
           full_document = specialchars(full_document)
@@ -123,17 +139,11 @@ module Diaspora
           %Q{[#{content}](#{link}#{title_chunk})}
         end
 
-        if @newlines
-          # in very clear cases, let newlines become <br /> tags
-          # Grabbed from Github flavored Markdown
-          full_document = full_document.gsub(/^[\w\<][^\n]*\n+/) do |x|
-            x =~ /\n{2}/ ? x : (x.strip!; x << "  \n")
-          end
-        end
 
         return full_document
       end
 
+
       def single_emphasis(text)
         "<em>#{text}</em>"
       end
diff --git a/spec/helpers/markdownify_helper_spec.rb b/spec/helpers/markdownify_helper_spec.rb
index e547ff4df..1349b0033 100644
--- a/spec/helpers/markdownify_helper_spec.rb
+++ b/spec/helpers/markdownify_helper_spec.rb
@@ -39,6 +39,13 @@ describe MarkdownifyHelper do
         markdownify(full_url).should == %Q{<p><a target="_blank" href="#{full_url}">#{url}</a></p>}
       end
 
+      it "doesn't muck up code text" do
+        message = %{`puts "Hello"`}
+        markdownify(message).should =~ %r{<p><code>puts &quot;Hello&quot;</code></p>}
+        message = %Q{~~~\nA\nB\n~~~\n}
+        markdownify(message).should =~ %r{<pre><code>\nA\nB\n</code></pre>}
+      end
+
       it "doesn't double parse video links" do
         message = "http://www.vimeo.com/17449557
                    http://www.youtube.com/watch?v=0x__dDWdf23&a=GxdCwVVULXdvEBKmx_f5ywvZ0zZHHHDU&list=ML&playnext=1