diff --git a/red/api/nodes.js b/red/api/nodes.js
index fa26e0a1e..47e42be32 100644
--- a/red/api/nodes.js
+++ b/red/api/nodes.js
@@ -59,20 +59,17 @@ module.exports = {
             comms.publish("node/added",info.nodes,false);
             if (node.module) {
                 log.audit({event: "nodes.install",module:node.module},req);
-                res.json(redNodes.getModuleInfo(node.module));
-            } else if (node.file) {
-                log.audit({event: "nodes.install",file:node.file},req);
-                res.json(info.nodes[0]);
+                res.json(info);
             }
         }).otherwise(function(err) {
             if (err.code === 404) {
-                log.audit({event: "nodes.install",module:node.module,file:node.file,error:"not_found"},req);
+                log.audit({event: "nodes.install",module:node.module,error:"not_found"},req);
                 res.status(404).end();
             } else if (err.code) {
                 log.audit({event: "nodes.install",module:node.module,error:err.code},req);
                 res.status(400).json({error:err.code, message:err.message});
             } else {
-                log.audit({event: "nodes.install",module:node.module,file:node.file,error:err.code||"unexpected_error",message:err.toString()},req);
+                log.audit({event: "nodes.install",module:node.module,error:err.code||"unexpected_error",message:err.toString()},req);
                 res.status(400).json({error:err.code||"unexpected_error", message:err.toString()});
             }
         });
diff --git a/red/nodes/registry/installer.js b/red/nodes/registry/installer.js
index 7c6740677..ba78281f0 100644
--- a/red/nodes/registry/installer.js
+++ b/red/nodes/registry/installer.js
@@ -28,37 +28,74 @@ var child_process = require('child_process');
 
 var settings;
 
+var moduleRe = /^[^/]+$/;
+var slashRe = process.platform === "win32" ? /\\|[/]/ : /[/]/;
+
 function init(_settings) {
     settings = _settings;
 }
 
+function checkModulePath(folder) {
+    var moduleName;
+    var err;
+    var fullPath = path.resolve(folder);
+    var packageFile = path.join(fullPath,'package.json');
+    if (fs.existsSync(packageFile)) {
+        var pkg = require(packageFile);
+        moduleName = pkg.name;
+        if (!pkg['node-red']) {
+            // TODO: nls
+            err = new Error("Invalid Node-RED module");
+            err.code = 'invalid_module';
+            throw err;
+        }
+    } else {
+        err = new Error("Module not found");
+        err.code = 404;
+        throw err;
+    }
+    return moduleName;
+}
+
+function checkExistingModule(module) {
+    if (registry.getModuleInfo(module)) {
+        // TODO: nls
+        var err = new Error("Module already loaded");
+        err.code = "module_already_loaded";
+        throw err;
+    }
+}
+
 function installModule(module) {
     //TODO: ensure module is 'safe'
     return when.promise(function(resolve,reject) {
-        if (/[\s;]/.test(module)) {
-            reject(new Error(log._("server.install.invalid")));
-            return;
-        }
-        if (registry.getModuleInfo(module)) {
-            // TODO: nls
-            var err = new Error("Module already loaded");
-            err.code = "module_already_loaded";
-            reject(err);
-            return;
+        var installName = module;
+
+        try {
+            if (moduleRe.test(module)) {
+                // Simple module name - assume it can be npm installed
+            } else if (slashRe.test(module)) {
+                // A path - check if there's a valid package.json
+                installName = module;
+                module = checkModulePath(module);
+            }
+            checkExistingModule(module);
+        } catch(err) {
+            return reject(err);
         }
         log.info(log._("server.install.installing",{name: module}));
 
         var installDir = settings.userDir || process.env.NODE_RED_HOME || ".";
-        var child = child_process.execFile('npm',['install','--production',module],
+        var child = child_process.execFile('npm',['install','--production',installName],
             {
                 cwd: installDir
             },
             function(err, stdin, stdout) {
                 if (err) {
-                    var lookFor404 = new RegExp(" 404 .*"+module+"$","m");
+                    var lookFor404 = new RegExp(" 404 .*"+installName+"$","m");
                     if (lookFor404.test(stdout)) {
                         log.warn(log._("server.install.install-failed-not-found",{name:module}));
-                        var e = new Error();
+                        var e = new Error("Module not found");
                         e.code = 404;
                         reject(e);
                     } else {
diff --git a/red/nodes/registry/loader.js b/red/nodes/registry/loader.js
index 5d6f84baf..265abe71f 100644
--- a/red/nodes/registry/loader.js
+++ b/red/nodes/registry/loader.js
@@ -321,34 +321,6 @@ function addModule(module) {
     }
 }
 
-function addFile(file) {
-    if (!settings.available()) {
-        throw new Error("Settings unavailable");
-    }
-    var info = registry.getNodeInfo("node-red/"+path.basename(file).replace(/^\d+-/,"").replace(/\.js$/,""));
-    if (info) {
-        var err = new Error("File already loaded");
-        err.code = "file_already_loaded";
-        return when.reject(err);
-    }
-    var nodeFiles = localfilesystem.getLocalFile(file);
-    if (nodeFiles) {
-        var fileObj = {};
-        fileObj[nodeFiles.module] = {
-            name: nodeFiles.module,
-            version: nodeFiles.version,
-            nodes: {}
-        };
-        fileObj[nodeFiles.module].nodes[nodeFiles.name] = nodeFiles;
-
-        return loadNodeFiles(fileObj);
-    } else {
-        var e = new Error();
-        e.code = 404;
-        return when.reject(e);
-    }
-}
-
 function loadNodeHelp(node,lang) {
     var dir = path.dirname(node.template);
     var base = path.basename(node.template);
@@ -385,7 +357,6 @@ module.exports = {
     init: init,
     load: load,
     addModule: addModule,
-    addFile: addFile,
     loadNodeSet: loadNodeSet,
     getNodeHelp: getNodeHelp
 }
diff --git a/test/red/api/nodes_spec.js b/test/red/api/nodes_spec.js
index ee0772ae5..f82e39a65 100644
--- a/test/red/api/nodes_spec.js
+++ b/test/red/api/nodes_spec.js
@@ -208,12 +208,11 @@ describe("nodes api", function() {
                 });
                 var getModuleInfo = sinon.stub(redNodes,'getModuleInfo');
                 getModuleInfo.onCall(0).returns(null);
-                getModuleInfo.onCall(1).returns({
-                    name:"foo",
-                    nodes:[{id:"123"}]
-                });
                 var installModule = sinon.stub(redNodes,'installModule', function() {
-                    return when.resolve({id:"123"});
+                    return when.resolve({
+                        name:"foo",
+                        nodes:[{id:"123"}]
+                    });
                 });
 
                 request(app)
diff --git a/test/red/nodes/registry/installer_spec.js b/test/red/nodes/registry/installer_spec.js
index be6b2f9a2..1e65cfa4a 100644
--- a/test/red/nodes/registry/installer_spec.js
+++ b/test/red/nodes/registry/installer_spec.js
@@ -17,6 +17,7 @@
 var should = require("should");
 var sinon = require("sinon");
 var when = require("when");
+var path = require("path");
 
 var child_process = require('child_process');
 var installer = require("../../../../red/nodes/registry/installer");
@@ -28,33 +29,25 @@ describe('nodes/registry/installer', function() {
     before(function() {
         installer.init({});
     });
+    afterEach(function() {
+        if (child_process.execFile.restore) {
+            child_process.execFile.restore();
+        }
+    })
 
     describe("installs module", function() {
-        it("rejects invalid module names", function(done) {
-            var promises = [];
-            promises.push(installer.installModule("this_wont_exist "));
-            promises.push(installer.installModule("this_wont_exist;no_it_really_wont"));
-            when.settle(promises).then(function(results) {
-                results[0].state.should.be.eql("rejected");
-                results[1].state.should.be.eql("rejected");
-                done();
-            });
-        });
-
         it("rejects when npm returns a 404", function(done) {
-            var exec = sinon.stub(child_process,"execFile",function(cmd,args,opt,cb) {
+            sinon.stub(child_process,"execFile",function(cmd,args,opt,cb) {
                 cb(new Error(),""," 404  this_wont_exist");
             });
 
             installer.installModule("this_wont_exist").otherwise(function(err) {
                 err.code.should.be.eql(404);
                 done();
-            }).finally(function() {
-                exec.restore();
             });
         });
         it("rejects with generic error", function(done) {
-            var exec = sinon.stub(child_process,"execFile",function(cmd,args,opt,cb) {
+            sinon.stub(child_process,"execFile",function(cmd,args,opt,cb) {
                 cb(new Error("test_error"),"","");
             });
 
@@ -62,13 +55,11 @@ describe('nodes/registry/installer', function() {
                 done(new Error("Unexpected success"));
             }).otherwise(function(err) {
                 done();
-            }).finally(function() {
-                exec.restore();
             });
         });
         it("succeeds when module is found", function(done) {
             var nodeInfo = {nodes:{module:"foo",types:["a"]}};
-            var exec = sinon.stub(child_process,"execFile",function(cmd,args,opt,cb) {
+            sinon.stub(child_process,"execFile",function(cmd,args,opt,cb) {
                 cb(null,"","");
             });
             var addModule = sinon.stub(registry,"addModule",function(md) {
@@ -84,10 +75,37 @@ describe('nodes/registry/installer', function() {
             }).otherwise(function(err) {
                 done(err);
             }).finally(function() {
-                exec.restore();
                 addModule.restore();
             });
         });
+        it("rejects when non-existant path is provided", function(done) {
+            var resourcesDir = path.resolve(path.join(__dirname,"..","resources","TestNodeModule","node_modules","NonExistant"));
+            installer.installModule(resourcesDir).then(function() {
+                done(new Error("Unexpected success"));
+            }).otherwise(function(err) {
+                err.code.should.eql(404);
+                done();
+            });
+        });
+        it("succeeds when path is valid node-red module", function(done) {
+            var nodeInfo = {nodes:{module:"foo",types:["a"]}};
+            var addModule = sinon.stub(registry,"addModule",function(md) {
+                return when.resolve(nodeInfo);
+            });
+            var resourcesDir = path.resolve(path.join(__dirname,"..","resources","TestNodeModule","node_modules","TestNodeModule"));
+            sinon.stub(child_process,"execFile",function(cmd,args,opt,cb) {
+                cb(null,"","");
+            });
+            installer.installModule(resourcesDir).then(function(info) {
+                info.should.eql(nodeInfo);
+                done();
+            }).otherwise(function(err) {
+                done(err);
+            }).finally(function() {
+                addModule.restore();
+            });
+        });
+
     });
     describe("uninstalls module", function() {
         it("rejects invalid module names", function(done) {
@@ -106,7 +124,7 @@ describe('nodes/registry/installer', function() {
             var removeModule = sinon.stub(registry,"removeModule",function(md) {
                 return when.resolve(nodeInfo);
             });
-            var exec = sinon.stub(child_process,"execFile",function(cmd,args,opt,cb) {
+            sinon.stub(child_process,"execFile",function(cmd,args,opt,cb) {
                 cb(new Error("test_error"),"","");
             });
 
@@ -115,7 +133,6 @@ describe('nodes/registry/installer', function() {
             }).otherwise(function(err) {
                 done();
             }).finally(function() {
-                exec.restore();
                 removeModule.restore();
             });
         });
@@ -127,7 +144,7 @@ describe('nodes/registry/installer', function() {
             var getModuleInfo = sinon.stub(registry,"getModuleInfo",function(md) {
                 return {nodes:[]};
             });
-            var exec = sinon.stub(child_process,"execFile",function(cmd,args,opt,cb) {
+            sinon.stub(child_process,"execFile",function(cmd,args,opt,cb) {
                 cb(null,"","");
             });
 
@@ -142,7 +159,6 @@ describe('nodes/registry/installer', function() {
             }).otherwise(function(err) {
                 done(err);
             }).finally(function() {
-                exec.restore();
                 removeModule.restore();
                 exists.restore();
                 getModuleInfo.restore();