diff --git a/lib/util.js b/lib/util.js
index 06df4f7..3e09040 100644
--- a/lib/util.js
+++ b/lib/util.js
@@ -13,8 +13,8 @@ double quoted string with double quotes escaped.
 Usage: interpolate(JSON.stringify(some_string) )
 */
 exports.interpolate = function interpolate(str) {
-	return str.replace(/(\\)?#{(.*)}/g, function(match, escaped, code) {
-		return escaped ? str : "\"+((__.z=" + code.replace(/\\"/g, '"') +
+	return str.replace(/(\\)?#{([^}]*)}/g, function(match, escaped, code) {
+		return escaped ? match : "\"+((__.z=" + code.replace(/\\"/g, '"') +
 			") == null ? '' : __.z)+\"";
 	});
 };
diff --git a/test/output/interpolate.html b/test/output/interpolate.html
new file mode 100644
index 0000000..af38d82
--- /dev/null
+++ b/test/output/interpolate.html
@@ -0,0 +1,5 @@
+<p>The author of Blade is Blake Miner</p><p>But no one really cares much
+I dunno because Jade is cool, too. I don't hate.
+Jade is cool, too. I don't hate.
+and because \#{escaped}
+and because TJ is the freakin' man, and everyone should know it</p>
\ No newline at end of file
diff --git a/test/templates/interpolate.blade b/test/templates/interpolate.blade
new file mode 100644
index 0000000..02475e3
--- /dev/null
+++ b/test/templates/interpolate.blade
@@ -0,0 +1,6 @@
+p The author of Blade is #{author}
+p But no one really cares much
+	| I dunno #{why} #{Jade}
+	| #{Jade}
+	| and because \#{escaped}
+	| and because TJ is #{TJ}