diff --git a/lib/tags/spaceless.js b/lib/tags/spaceless.js
index e0e10668..32f3fdc4 100644
--- a/lib/tags/spaceless.js
+++ b/lib/tags/spaceless.js
@@ -15,20 +15,12 @@ var utils = require('../utils');
  *
  */
 exports.compile = function (compiler, args, content, parents, options, blockName) {
-  function stripWhitespace(tokens) {
-    return utils.map(tokens, function (token) {
-      if (token.content || typeof token !== 'string') {
-        token.content = stripWhitespace(token.content);
-        return token;
-      }
+  var out = compiler(content, parents, options, blockName);
+  out += '_output = _output.replace(/^\\s+/, "")\n' +
+         '  .replace(/>\\s+</g, "><")\n' +
+         '  .replace(/\\s+$/, "");\n';
 
-      return token.replace(/^\s+/, '')
-        .replace(/>\s+</g, '><')
-        .replace(/\s+$/, '');
-    });
-  }
-
-  return compiler(stripWhitespace(content), parents, options, blockName);
+  return out;
 };
 
 exports.parse = function (str, line, parser) {
diff --git a/tests/tags/spaceless.test.js b/tests/tags/spaceless.test.js
index 9207739a..165da6ee 100644
--- a/tests/tags/spaceless.test.js
+++ b/tests/tags/spaceless.test.js
@@ -7,8 +7,8 @@ var cases = [
   { c: '{% spaceless %} <p> foo </p> <p>bar</p> {% endspaceless %}', e: '<p> foo </p><p>bar</p>' },
   { c: '{% spaceless %}{% if true %}<p></p> <p></p>{% endif %}{% endspaceless %}', e: '<p></p><p></p>' },
   { c: '{% spaceless %}{% if false %}{% else %}<p></p> <p></p>{% endif %}{% endspaceless %}', e: '<p></p><p></p>' },
-  { c: '{% spaceless %}{% macro foo %}<p></p> <p></p>{% endmacro %}{% endspaceless %}{{ foo() }}', e: '<p></p><p></p>' },
-  { c: '{% macro foo %}<p></p> <p></p>{% endmacro %}{% spaceless %}{{ foo() }}{% endspaceless %}', e: '<p></p> <p></p>' }
+  { c: '{% spaceless %}{% macro foo %}<p></p> <p></p>{% endmacro %}{% endspaceless %}{{ foo() }}', e: '<p></p> <p></p>' },
+  { c: '{% macro foo %}<p></p> <p></p>{% endmacro %}{% spaceless %}{{ foo() }}{% endspaceless %}', e: '<p></p><p></p>' }
 ];
 
 describe('Tag: spaceless', function () {