diff --git a/lib/compiler.js b/lib/compiler.js
index e57af716..56b373c4 100644
--- a/lib/compiler.js
+++ b/lib/compiler.js
@@ -1,3 +1,5 @@
+var shelljs = require('shelljs');
+var shelljs_global = require('shelljs/global');
 var web3 = require('web3');
 
 Compiler = function(blockchainConfig) {
@@ -18,8 +20,31 @@ Compiler.prototype.init = function(env) {
   console.log("address is : " + primaryAddress);
 };
 
-Compiler.prototype.compile = function(source) {
-  return web3.eth.compile.solidity(source);
+Compiler.prototype.compile = function(contractFile) {
+  var cmd, result, output, json, compiled_object;
+
+  cmd = "solc --input-file " + contractFile + " --combined-json binary,json-abi";
+
+  result = exec(cmd, {silent: true});
+  output = result.output;
+
+  if (result.code === 1) {
+    throw new Error(result.output);
+  }
+
+  json = JSON.parse(output).contracts;
+  compiled_object = {}
+
+  for (var className in json) {
+    var contract = json[className];
+
+    compiled_object[className] = {};
+    compiled_object[className].code = contract.binary;
+    compiled_object[className].info = {};
+    compiled_object[className].info.abiDefinition = JSON.parse(contract["json-abi"]);
+  }
+
+  return compiled_object;
 };
 
 module.exports = Compiler;
diff --git a/lib/config/contracts.js b/lib/config/contracts.js
index 5a42e00a..ee962442 100644
--- a/lib/config/contracts.js
+++ b/lib/config/contracts.js
@@ -79,9 +79,8 @@ ContractsConfig.prototype.compileContracts = function(env) {
   // compile files
   for (j = 0; j < this.contractFiles.length; j++) {
     contractFile = this.contractFiles[j];
-    source = fs.readFileSync(contractFile).toString()
 
-    compiled_contracts = this.compiler.compile(source);
+    compiled_contracts = this.compiler.compile(contractFile);
     for (var className in compiled_contracts) {
       var contract = compiled_contracts[className];
 
diff --git a/test/compiler.js b/test/compiler.js
new file mode 100644
index 00000000..196be791
--- /dev/null
+++ b/test/compiler.js
@@ -0,0 +1,37 @@
+var Compiler = require('../lib/compiler.js');
+var assert = require('assert');
+
+describe('embark.compiler', function() {
+
+  describe('compile a file', function() {
+    var files = [
+      'test/support/contracts/simple_storage.sol'
+    ];
+
+    it("should build a correct compiled object", function() {
+      var compiler = new Compiler();
+
+      var compiledFile = compiler.compile(files[0]);
+
+      assert.equal(compiledFile.SimpleStorage.code, '606060405260405160208060f78339016040526060805190602001505b806000600050819055505b5060c28060356000396000f30060606040526000357c0100000000000000000000000000000000000000000000000000000000900480632a1afcd914604b57806360fe47b114606a5780636d4ce63c14607b576049565b005b605460045060b9565b6040518082815260200191505060405180910390f35b6079600480359060200150609a565b005b608460045060a8565b6040518082815260200191505060405180910390f35b806000600050819055505b50565b6000600060005054905060b6565b90565b6000600050548156');
+
+      assert.equal(JSON.stringify(compiledFile.SimpleStorage.info.abiDefinition), '[{"constant":true,"inputs":[],"name":"storedData","outputs":[{"name":"","type":"uint256"}],"type":"function"},{"constant":false,"inputs":[{"name":"x","type":"uint256"}],"name":"set","outputs":[],"type":"function"},{"constant":true,"inputs":[],"name":"get","outputs":[{"name":"retVal","type":"uint256"}],"type":"function"},{"inputs":[{"name":"initialValue","type":"uint256"}],"type":"constructor"}]');
+      });
+
+  });
+
+  describe('compile a file with an error', function() {
+    var files = [
+      'test/support/contracts/error.sol'
+    ];
+
+    it("throw an error", function() {
+      var compiler = new Compiler();
+
+      assert.throws(function() { compiler.compile(files[0]) }, Error);
+    });
+
+  });
+
+});
+
diff --git a/test/support/contracts/error.sol b/test/support/contracts/error.sol
new file mode 100644
index 00000000..c15c5158
--- /dev/null
+++ b/test/support/contracts/error.sol
@@ -0,0 +1,14 @@
+contract SimpleStorage {
+  uint public storedData;
+
+  function SimpleStorage(uint initialValue) {
+    storedData2 = initialValue;
+  }
+
+  function set(uint x) {
+    storedData = x;
+  }
+  function get() constant returns (uint retVal) {
+    return storedData;
+  }
+}