diff --git a/ChangeLog b/ChangeLog
index f1355d1b0..0d90e0fbd 100644
--- a/ChangeLog
+++ b/ChangeLog
@@ -1,5 +1,13 @@
 2007-05-08  Stefan Monnier  <monnier@iro.umontreal.ca>
 
+	* inf-haskell.el (inferior-haskell-use-cabal): New custom var.
+	(inferior-haskell-cabal-of-buf): New fun.
+	(inferior-haskell-load-file): Use it to try and do the right thing in
+	multi-directory projects using a Cabal file.
+
+	* haskell-cabal.el (inferior-haskell-string-prefix-p)
+	(haskell-cabal-find-file): New functions.
+
 	* inf-haskell.el (inferior-haskell-string-to-strings):
 	Remove `separator' argument.  Call split string without separator arg
 	either, so that it drops null strings.
diff --git a/NEWS b/NEWS
index d78c6620e..9c1ab0de9 100644
--- a/NEWS
+++ b/NEWS
@@ -1,5 +1,10 @@
 Changes since 2.3:
 
+* inf-haskell.el looks for a Cabal file to determine the root of a project.
+  If all works well, this will make C-c C-l automatically switch to the root
+  dir, so that dependencies in other directories are automatically found.
+  If it doesn't, complain and/or set inferior-haskell-use-cabal to nil.
+
 * The new command haskell-hoogle helps you query Hoogle from Emacs.
 
 Changes since 2.2:
diff --git a/inf-haskell.el b/inf-haskell.el
index ecb31ab8b..05602a51c 100644
--- a/inf-haskell.el
+++ b/inf-haskell.el
@@ -66,6 +66,10 @@ The command can include arguments."
   "Regexps for error messages generated by inferior Haskell processes.
 The format should be the same as for `compilation-error-regexp-alist'.")
 
+(defcustom inferior-haskell-use-cabal t
+  "If non-nil, try and find a Cabal file to get the project root directory."
+  :type 'boolean)
+
 (define-derived-mode inferior-haskell-mode comint-mode "Inf-Haskell"
   "Major mode for interacting with an inferior Haskell process."
   (set (make-local-variable 'comint-prompt-regexp)
@@ -170,22 +174,40 @@ The process PROC should be associated to a comint buffer."
              (and (not (re-search-forward comint-prompt-regexp nil t))
                   (accept-process-output proc))))))
 
+(defvar inferior-haskell-cabal-buffer nil)
+
+(defun inferior-haskell-cabal-of-buf (buf)
+  (require 'haskell-cabal)
+  (with-current-buffer buf
+    (or inferior-haskell-cabal-buffer
+        (and (not (local-variable-p 'inferior-haskell-cabal-buffer))
+             (set (make-local-variable 'inferior-haskell-cabal-buffer)
+                  (haskell-cabal-find-file))))))
+
 ;;;###autoload
 (defun inferior-haskell-load-file (&optional reload)
   "Pass the current buffer's file to the inferior haskell process."
   (interactive)
   ;; Save first, so we're sure that `buffer-file-name' is non-nil afterward.
   (save-buffer)
-  (let ((file buffer-file-name)
+  (let ((buf (current-buffer))
+        (file buffer-file-name)
 	(proc (inferior-haskell-process)))
     (with-current-buffer (process-buffer proc)
-      ;; Not sure if it's useful/needed and if it actually works.
-      ;; (unless (equal (file-name-as-directory default-directory)
-      ;;                (file-name-directory file))
-      ;;   (inferior-haskell-send-string
-      ;;    proc (concat ":cd " (file-name-directory file) "\n")))
       (compilation-forget-errors)
-      (let ((parsing-end (marker-position (process-mark proc))))
+      (let ((parsing-end (marker-position (process-mark proc)))
+            cabal)
+        ;; Go to the root of the Cabal project, if applicable.
+        (when (and inferior-haskell-use-cabal
+                   (setq cabal (inferior-haskell-cabal-of-buf buf)))
+          ;; Not sure if it's useful/needed and if it actually works.
+          (unless (equal default-directory
+                         (with-current-buffer cabal default-directory))
+            (setq default-directory
+                  (with-current-buffer cabal default-directory))
+            (inferior-haskell-send-command
+             proc (concat ":cd " default-directory)))
+          (setq file (file-relative-name file)))
 	(inferior-haskell-send-command
 	 proc (if reload ":reload" (concat ":load \"" file "\"")))
 	;; Move the parsing-end marker after sending the command so