diff --git a/README.md b/README.md
index 056d692..f475da2 100644
--- a/README.md
+++ b/README.md
@@ -36,7 +36,7 @@ If you pass `errLogToConsole: true` into the options hash, sass errors will be l
 
 #Imports and Partials
 
-If you want to use imports or partials, you'll need to pass the `includePaths` option along to node-sass. So if you have files like this:
+gulp-sass now automatically passes along the directory of every scss file it parses as an include path for node-sass. This means that as long as you specify your includes relative to path of your scss file, everything will just work.
 
 scss/includes/_settings.scss:
 
@@ -48,7 +48,7 @@ $margin: 16px;
 scss/style.scss:
 
 ```scss
-@import "settings";
+@import "includes/settings";
 
 .content-navigation {
   border-color: $blue;
@@ -63,12 +63,3 @@ scss/style.scss:
 }
 ```
 
-Your code should look something like this:
-
-```javascript
-gulp.task('sass', function () {
-  gulp.src('./scss/*.scss')
-    .pipe(sass({includePaths: ['scss/includes']}))
-    .pipe(gulp.dest('./css'));
-});
-```
diff --git a/index.js b/index.js
index 3d5ca84..6a83761 100644
--- a/index.js
+++ b/index.js
@@ -19,6 +19,16 @@ module.exports = function (options) {
 
     opts.data = file.contents.toString();
 
+    var fileDir = path.dirname(file.path);
+
+    if (opts.includePaths && Array.isArray(opts.includePaths)) {
+      if (opts.includePaths.indexOf(fileDir) === -1) {
+        opts.includePaths.push(fileDir)
+      }
+    } else {
+      opts.includePaths = [fileDir];
+    }
+
     opts.success = function (css) {
       file.path      = ext(file.path, '.css');
       file.contents  = new Buffer(css);
diff --git a/test/scss/inheritance.scss b/test/scss/inheritance.scss
index 053670a..f3caa92 100644
--- a/test/scss/inheritance.scss
+++ b/test/scss/inheritance.scss
@@ -1,4 +1,4 @@
-@import "cats";
+@import "includes/cats";
 
 .error {
   border: #f00;
diff --git a/test/test.js b/test/test.js
index d096c93..3a440dc 100644
--- a/test/test.js
+++ b/test/test.js
@@ -67,10 +67,7 @@ test('compile multiple sass files', function (t) {
   ];
 
   t.plan(files.length * 4);
-  var stream = gsass({ 
-    includePaths: [path.join(__dirname, 'scss'), 
-                   path.join(__dirname, 'scss/includes')]
-  });
+  var stream = gsass();
 
   stream.on('data', function (cssFile) {
     t.ok(cssFile, 'cssFile exists');