diff --git a/spec/app/edit-session-spec.coffee b/spec/app/edit-session-spec.coffee
index 2bdc18d68..cfcc7e61e 100644
--- a/spec/app/edit-session-spec.coffee
+++ b/spec/app/edit-session-spec.coffee
@@ -1056,12 +1056,25 @@ describe "EditSession", ->
           expect(buffer.lineForRow(1)).toBe '  var sort = function(it) {'
 
     describe ".insertTab()", ->
-      describe "if 'softTabs' is true (the default)", ->
-        it "inserts the value of 'tabText' into the buffer", ->
-          tabRegex = new RegExp("^#{editSession.tabText}")
-          expect(buffer.lineForRow(0)).not.toMatch(tabRegex)
-          editSession.insertTab()
-          expect(buffer.lineForRow(0)).toMatch(tabRegex)
+      describe "when nothing is selected", ->
+        describe "if 'softTabs' is true (the default)", ->
+          it "inserts the value of 'tabText' into the buffer", ->
+            tabRegex = new RegExp("^#{editSession.tabText}")
+            expect(buffer.lineForRow(0)).not.toMatch(tabRegex)
+            editSession.insertTab()
+            expect(buffer.lineForRow(0)).toMatch(tabRegex)
+
+        describe "when auto-indent is on and there is no text after the cursor", ->
+          it "properly indents the line", ->
+            buffer.insert([7, 0], "  \n")
+            editSession.tabText = "  "
+            editSession.setCursorBufferPosition [7, 2]
+            editSession.setAutoIndent(true)
+            editSession.insertTab()
+            buffer.logLines()
+            expect(buffer.lineForRow(7)).toMatch /^\s+$/
+            expect(buffer.lineForRow(7).length).toBe 6
+            expect(editSession.getCursorBufferPosition()).toEqual [7, 6]
 
       describe "if editSession.softTabs is false", ->
         it "inserts a tab character into the buffer", ->
diff --git a/src/app/edit-session.coffee b/src/app/edit-session.coffee
index 6f2ececfe..cc2556d2a 100644
--- a/src/app/edit-session.coffee
+++ b/src/app/edit-session.coffee
@@ -131,7 +131,12 @@ class EditSession
 
   insertTab: ->
     if @getSelection().isEmpty()
-      if @softTabs
+      whitespaceMatch = @lineForBufferRow(@getCursorBufferPosition().row).match /^\s*$/
+      if @autoIndent and whitespaceMatch
+        indentation = @indentationForRow(@getCursorBufferPosition().row)
+        @getSelection().selectLine()
+        @insertText(indentation)
+      else if @softTabs
         @insertText(@tabText)
       else
         @insertText('\t')
@@ -225,6 +230,9 @@ class EditSession
   largestFoldStartingAtScreenRow: (screenRow) ->
     @displayBuffer.largestFoldStartingAtScreenRow(screenRow)
 
+  indentationForRow: (row) ->
+    @tokenizedBuffer.indentationForRow(row)
+
   autoIndentTextAfterBufferPosition: (text, bufferPosition) ->
     return { text } unless @autoIndent
     @tokenizedBuffer.autoIndentTextAfterBufferPosition(text, bufferPosition)
diff --git a/src/app/tokenized-buffer.coffee b/src/app/tokenized-buffer.coffee
index 80649b8e4..15dc42a02 100644
--- a/src/app/tokenized-buffer.coffee
+++ b/src/app/tokenized-buffer.coffee
@@ -48,6 +48,11 @@ class TokenizedBuffer
     else
       null
 
+  indentationForRow: (row) ->
+    state = @stateForRow(row)
+    previousRowText = @buffer.lineForRow(row - 1)
+    @aceMode.getNextLineIndent(state, previousRowText, @tabText)
+
   autoIndentTextAfterBufferPosition: (text, bufferPosition) ->
     { row, column} = bufferPosition
     state = @stateForRow(row)