diff --git a/popcorn.js b/popcorn.js
index b4c759e82..bf5004c9f 100644
--- a/popcorn.js
+++ b/popcorn.js
@@ -1378,7 +1378,7 @@
       //  Storing the plugin natives
       var natives = options._natives = {},
           compose = "",
-          defaults, originalOpts, manifestOpts, mergedSetupOpts;
+          originalOpts, manifestOpts;
 
       Popcorn.extend( natives, setup );
 
@@ -1401,9 +1401,6 @@
         args[ 1 ]._running && natives.end.apply( this, args );
       }, natives._teardown );
 
-      // Check for previously set default options
-      defaults = this.options.defaults && this.options.defaults[ options._natives && options._natives.type ];
-
       // default to an empty string if no effect exists
       // split string into an array of effects
       options.compose = options.compose && options.compose.split( " " ) || [];
@@ -1454,25 +1451,21 @@
         };
       }
 
-      // Merge with defaults if they exist, make sure per call is prioritized
-      mergedSetupOpts = defaults ? Popcorn.extend( {}, defaults, options ) :
-                          options;
-
       // Resolves 239, 241, 242
-      if ( !mergedSetupOpts.target ) {
+      if ( !options.target ) {
 
         //  Sometimes the manifest may be missing entirely
         //  or it has an options object that doesn't have a `target` property
         manifestOpts = "options" in manifest && manifest.options;
 
-        mergedSetupOpts.target = manifestOpts && "target" in manifestOpts && manifestOpts.target;
+        options.target = manifestOpts && "target" in manifestOpts && manifestOpts.target;
       }
 
       // Trigger _setup method if exists
-      options._natives._setup && options._natives._setup.call( this, mergedSetupOpts );
+      options._natives._setup && options._natives._setup.call( this, options );
 
       // Create new track event for this instance
-      Popcorn.addTrackEvent( this, Popcorn.extend( mergedSetupOpts, options ) );
+      Popcorn.addTrackEvent( this, Popcorn.extend( options, options ) );
 
       //  Future support for plugin event definitions
       //  for all of the native events
@@ -1494,8 +1487,13 @@
     //  Extend Popcorn.p with new named definition
     //  Assign new named definition
     Popcorn.p[ name ] = plugin[ name ] = function( options ) {
-      return pluginFn.call( this, isfn ? definition.call( this, options ) : definition,
-                                  options );
+    
+      // Merge with defaults if they exist, make sure per call is prioritized
+      var defaults = ( this.options.defaults && this.options.defaults[ name ] ) || {},
+          mergedSetupOpts = Popcorn.extend( {}, defaults, options );
+      
+      return pluginFn.call( this, isfn ? definition.call( this, mergedSetupOpts ) : definition,
+                                  mergedSetupOpts );
     };
 
     //  Push into the registry
diff --git a/test/popcorn.unit.js b/test/popcorn.unit.js
index 0f9972084..03b94854f 100644
--- a/test/popcorn.unit.js
+++ b/test/popcorn.unit.js
@@ -1630,13 +1630,13 @@ test( "Manifest removal", function() {
 
 test( "Configurable Defaults", function() {
 
-  var expects = 13,
+  var expects = 14,
       count = 0,
       p;
 
   function plus() {
     if ( ++count === expects ) {
-      [ "configurable", "multiconfig", "overridden" ].forEach(function( val ) {
+      [ "configurable", "multiconfig", "overridden", "funtionInitDefaults" ].forEach(function( val ) {
         Popcorn.removePlugin( val );
         delete Popcorn.manifest[ val ];
       });
@@ -1723,6 +1723,17 @@ test( "Configurable Defaults", function() {
     };
   });
 
+  Popcorn.plugin( "funtionInitDefaults", function( options ) {
+
+    equal( options.defaultItem, "foo bar", "defaults work inside auto setup function" );
+    plus();
+
+    return {
+      start: Popcorn.nop,
+      end: Popcorn.nop
+    };
+  });
+
   p = Popcorn( "#video", {
             defaults: {
               overridden: {
@@ -1731,6 +1742,12 @@ test( "Configurable Defaults", function() {
             }
           });
 
+  p.defaults( "funtionInitDefaults", {
+    defaultItem: "foo bar"
+  });
+          
+  p.funtionInitDefaults({});
+
   p.defaults( "configurable", {
 
     // set a default element target id