diff --git a/bundlerepository/src/main/java/org/apache/felix/bundlerepository/Referral.java b/bundlerepository/src/main/java/org/apache/felix/bundlerepository/Referral.java
new file mode 100644
index 0000000..ad34c76
--- /dev/null
+++ b/bundlerepository/src/main/java/org/apache/felix/bundlerepository/Referral.java
@@ -0,0 +1,52 @@
+/* 
+ * Licensed to the Apache Software Foundation (ASF) under one
+ * or more contributor license agreements.  See the NOTICE file
+ * distributed with this work for additional information
+ * regarding copyright ownership.  The ASF licenses this file
+ * to you under the Apache License, Version 2.0 (the
+ * "License"); you may not use this file except in compliance
+ * with the License.  You may obtain a copy of the License at
+ *
+ *   http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied.  See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package org.apache.felix.bundlerepository;
+
+public class Referral
+{
+    private int m_depth = 1;
+    private String m_url;
+
+    public int getDepth()
+    {
+        return m_depth;
+    }
+
+    public String getUrl()
+    {
+        return m_url;
+    }
+
+    public void setUrl(String url)
+    {
+        m_url = url;
+    }
+
+    public void setDepth(String depth)
+    {
+        try
+        {
+            m_depth = Integer.parseInt(depth);
+        }
+        catch (NumberFormatException nfe)
+        {
+            // don't care, and don't change current value
+        }
+    }
+}
\ No newline at end of file
diff --git a/bundlerepository/src/main/java/org/apache/felix/bundlerepository/RepositoryAdminImpl.java b/bundlerepository/src/main/java/org/apache/felix/bundlerepository/RepositoryAdminImpl.java
index beb0a5b..9d8151c 100644
--- a/bundlerepository/src/main/java/org/apache/felix/bundlerepository/RepositoryAdminImpl.java
+++ b/bundlerepository/src/main/java/org/apache/felix/bundlerepository/RepositoryAdminImpl.java
@@ -20,10 +20,21 @@
 
 import java.net.MalformedURLException;
 import java.net.URL;
-import java.util.*;
+import java.util.ArrayList;
+import java.util.Arrays;
+import java.util.Comparator;
+import java.util.HashMap;
+import java.util.List;
+import java.util.Map;
+import java.util.StringTokenizer;
 
-import org.osgi.framework.*;
-import org.osgi.service.obr.*;
+import org.osgi.framework.BundleContext;
+import org.osgi.framework.Filter;
+import org.osgi.framework.InvalidSyntaxException;
+import org.osgi.service.obr.Repository;
+import org.osgi.service.obr.RepositoryAdmin;
+import org.osgi.service.obr.Resolver;
+import org.osgi.service.obr.Resource;
 
 public class RepositoryAdminImpl implements RepositoryAdmin
 {
@@ -35,8 +46,7 @@
     // Reusable comparator for sorting resources by name.
     private Comparator m_nameComparator = new ResourceComparator();
 
-    private static final String DEFAULT_REPOSITORY_URL =
-        "http://oscar-osgi.sourceforge.net/obr2/repository.xml";
+    private static final String DEFAULT_REPOSITORY_URL = "http://oscar-osgi.sourceforge.net/obr2/repository.xml";
     public static final String REPOSITORY_URL_PROP = "obr.repository.url";
     public static final String EXTERN_REPOSITORY_TAG = "extern-repositories";
 
@@ -45,7 +55,12 @@
         m_context = context;
     }
 
-    public synchronized Repository addRepository(URL url) throws Exception
+    public Repository addRepository(URL url) throws Exception
+    {
+        return addRepository(url, Integer.MAX_VALUE);
+    }
+
+    public synchronized Repository addRepository(URL url, int hopCount) throws Exception
     {
         if (!m_urlList.contains(url))
         {
@@ -55,7 +70,7 @@
         // If the repository URL is a duplicate, then we will just
         // replace the existing repository object with a new one,
         // which is effectively the same as refreshing the repository.
-        Repository repo = new RepositoryImpl(url);
+        Repository repo = new RepositoryImpl(this, url, hopCount);
         m_repoMap.put(url, repo);
         return repo;
     }
@@ -98,7 +113,7 @@
             initialize();
         }
 
-        Filter filter =  null;
+        Filter filter = null;
         try
         {
             filter = m_context.createFilter(filterExpr);
@@ -181,7 +196,7 @@
             URL url = (URL) m_urlList.get(i);
             try
             {
-                Repository repo = new RepositoryImpl(url);
+                Repository repo = new RepositoryImpl(this, url);
                 if (repo != null)
                 {
                     m_repoMap.put(url, repo);
@@ -189,10 +204,8 @@
             }
             catch (Exception ex)
             {
-                System.err.println(
-                    "RepositoryAdminImpl: Exception creating repository - " + ex);
-                System.err.println(
-                    "RepositoryAdminImpl: Ignoring repository " + url);
+                System.err.println("RepositoryAdminImpl: Exception creating repository - " + ex);
+                System.err.println("RepositoryAdminImpl: Ignoring repository " + url);
             }
         }
     }
diff --git a/bundlerepository/src/main/java/org/apache/felix/bundlerepository/RepositoryImpl.java b/bundlerepository/src/main/java/org/apache/felix/bundlerepository/RepositoryImpl.java
index aed0524..1c01ef7 100644
--- a/bundlerepository/src/main/java/org/apache/felix/bundlerepository/RepositoryImpl.java
+++ b/bundlerepository/src/main/java/org/apache/felix/bundlerepository/RepositoryImpl.java
@@ -1,4 +1,4 @@
-/* 
+/*
  * Licensed to the Apache Software Foundation (ASF) under one
  * or more contributor license agreements.  See the NOTICE file
  * distributed with this work for additional information
@@ -18,19 +18,28 @@
  */
 package org.apache.felix.bundlerepository;
 
-import java.io.*;
+import java.io.BufferedReader;
+import java.io.IOException;
+import java.io.InputStream;
+import java.io.InputStreamReader;
 import java.lang.reflect.Method;
-import java.net.*;
+import java.net.URL;
+import java.net.URLConnection;
+import java.security.AccessController;
+import java.security.PrivilegedActionException;
+import java.security.PrivilegedExceptionAction;
 import java.text.ParseException;
 import java.text.SimpleDateFormat;
 import java.util.Arrays;
 import java.util.zip.ZipEntry;
 import java.util.zip.ZipInputStream;
-import java.security.*;
 
 import org.apache.felix.bundlerepository.metadataparser.XmlCommonHandler;
 import org.apache.felix.bundlerepository.metadataparser.kxmlsax.KXml2SAXParser;
-import org.osgi.service.obr.*;
+import org.osgi.service.obr.Capability;
+import org.osgi.service.obr.Repository;
+import org.osgi.service.obr.Requirement;
+import org.osgi.service.obr.Resource;
 
 public class RepositoryImpl implements Repository
 {
@@ -38,13 +47,20 @@
     private long m_lastmodified = 0;
     private URL m_url = null;
     private Resource[] m_resources = null;
-    private int m_hopCount = 1;
+    private Referral[] m_referrals = null;
+    private RepositoryAdminImpl m_repoAdmin = null;
 
     // Reusable comparator for sorting resources by name.
     private ResourceComparator m_nameComparator = new ResourceComparator();
 
-    public RepositoryImpl(URL url) throws Exception
+    public RepositoryImpl(RepositoryAdminImpl repoAdmin, URL url) throws Exception
     {
+        this(repoAdmin, url, Integer.MAX_VALUE);
+    }
+
+    public RepositoryImpl(RepositoryAdminImpl repoAdmin, URL url, final int hopCount) throws Exception
+    {
+        m_repoAdmin = repoAdmin;
         m_url = url;
         try
         {
@@ -52,12 +68,12 @@
             {
                 public Object run() throws Exception
                 {
-                    parseRepositoryFile(m_hopCount);
+                    parseRepositoryFile(hopCount);
                     return null;
                 }
             });
-        } 
-        catch (PrivilegedActionException ex) 
+        }
+        catch (PrivilegedActionException ex)
         {
             throw (Exception) ex.getCause();
         }
@@ -86,7 +102,8 @@
         // Add to resource array.
         if (m_resources == null)
         {
-            m_resources = new Resource[] { resource };
+            m_resources = new Resource[]
+                { resource };
         }
         else
         {
@@ -99,6 +116,28 @@
         Arrays.sort(m_resources, m_nameComparator);
     }
 
+    public Referral[] getReferrals()
+    {
+        return m_referrals;
+    }
+
+    public void addReferral(Referral referral) throws Exception
+    {
+        // Add to resource array.
+        if (m_referrals == null)
+        {
+            m_referrals = new Referral[]
+                { referral };
+        }
+        else
+        {
+            Referral[] newResources = new Referral[m_referrals.length + 1];
+            System.arraycopy(m_referrals, 0, newResources, 0, m_referrals.length);
+            newResources[m_referrals.length] = referral;
+            m_referrals = newResources;
+        }
+    }
+
     public String getName()
     {
         return m_name;
@@ -128,7 +167,7 @@
 
     /**
      * Default setter method when setting parsed data from the XML file,
-     * which currently ignores everything. 
+     * which currently ignores everything.
     **/
     protected Object put(Object key, Object value)
     {
@@ -138,26 +177,23 @@
 
     private void parseRepositoryFile(int hopCount) throws Exception
     {
-// TODO: OBR - Implement hop count.
         InputStream is = null;
         BufferedReader br = null;
 
         try
         {
-            // Do it the manual way to have a chance to 
+            // Do it the manual way to have a chance to
             // set request properties as proxy auth (EW).
-            URLConnection conn = m_url.openConnection(); 
+            URLConnection conn = m_url.openConnection();
 
             // Support for http proxy authentication
             String auth = System.getProperty("http.proxyAuth");
             if ((auth != null) && (auth.length() > 0))
             {
-                if ("http".equals(m_url.getProtocol()) ||
-                    "https".equals(m_url.getProtocol()))
+                if ("http".equals(m_url.getProtocol()) || "https".equals(m_url.getProtocol()))
                 {
                     String base64 = Util.base64Encode(auth);
-                    conn.setRequestProperty(
-                        "Proxy-Authorization", "Basic " + base64);
+                    conn.setRequestProperty("Proxy-Authorization", "Basic " + base64);
                 }
             }
 
@@ -178,13 +214,14 @@
             else
             {
                 is = conn.getInputStream();
-            } 
+            }
 
             if (is != null)
             {
                 // Create the parser Kxml
                 XmlCommonHandler handler = new XmlCommonHandler();
-                Object factory = new Object() {
+                Object factory = new Object()
+                {
                     public RepositoryImpl newInstance()
                     {
                         return RepositoryImpl.this;
@@ -192,15 +229,16 @@
                 };
 
                 // Get default setter method for Repository.
-                Method repoSetter = RepositoryImpl.class.getDeclaredMethod(
-                    "put", new Class[] { Object.class, Object.class });
+                Method repoSetter = RepositoryImpl.class.getDeclaredMethod("put", new Class[]
+                    { Object.class, Object.class });
 
                 // Get default setter method for Resource.
-                Method resSetter = ResourceImpl.class.getDeclaredMethod(
-                    "put", new Class[] { Object.class, Object.class });
+                Method resSetter = ResourceImpl.class.getDeclaredMethod("put", new Class[]
+                    { Object.class, Object.class });
 
                 // Map XML tags to types.
                 handler.addType("repository", factory, Repository.class, repoSetter);
+                handler.addType("referral", Referral.class, null, null);
                 handler.addType("resource", ResourceImpl.class, Resource.class, resSetter);
                 handler.addType("category", CategoryImpl.class, null, null);
                 handler.addType("require", RequirementImpl.class, Requirement.class, null);
@@ -212,6 +250,21 @@
                 KXml2SAXParser parser;
                 parser = new KXml2SAXParser(br);
                 parser.parseXML(handler);
+
+                // resolve referrals
+                hopCount--;
+                if (hopCount > 0 && m_referrals != null)
+                {
+                    for (int i = 0; i < m_referrals.length; i++)
+                    {
+                        Referral referral = m_referrals[i];
+
+                        URL url = new URL(getURL(), referral.getUrl());
+                        hopCount = (referral.getDepth() > hopCount) ? hopCount : referral.getDepth();
+
+                        m_repoAdmin.addRepository(url, hopCount);
+                    }
+                }
             }
             else
             {
@@ -223,7 +276,8 @@
         {
             try
             {
-                if (is != null) is.close();
+                if (is != null)
+                    is.close();
             }
             catch (IOException ex)
             {
@@ -231,4 +285,4 @@
             }
         }
     }
-}
+}
\ No newline at end of file
diff --git a/bundlerepository/src/test/java/org/apache/felix/bundlerepository/RepositoryImplTest.java b/bundlerepository/src/test/java/org/apache/felix/bundlerepository/RepositoryImplTest.java
new file mode 100644
index 0000000..367ff68
--- /dev/null
+++ b/bundlerepository/src/test/java/org/apache/felix/bundlerepository/RepositoryImplTest.java
@@ -0,0 +1,244 @@
+/*
+ * Licensed to the Apache Software Foundation (ASF) under one
+ * or more contributor license agreements.  See the NOTICE file
+ * distributed with this work for additional information
+ * regarding copyright ownership.  The ASF licenses this file
+ * to you under the Apache License, Version 2.0 (the
+ * "License"); you may not use this file except in compliance
+ * with the License.  You may obtain a copy of the License at
+ *
+ *   http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied.  See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package org.apache.felix.bundlerepository;
+
+import java.io.File;
+import java.io.InputStream;
+import java.net.URL;
+import java.util.Dictionary;
+
+import junit.framework.TestCase;
+
+import org.osgi.framework.Bundle;
+import org.osgi.framework.BundleContext;
+import org.osgi.framework.BundleListener;
+import org.osgi.framework.Filter;
+import org.osgi.framework.FrameworkListener;
+import org.osgi.framework.ServiceListener;
+import org.osgi.framework.ServiceReference;
+import org.osgi.framework.ServiceRegistration;
+import org.osgi.service.obr.Repository;
+import org.osgi.service.obr.Resource;
+
+public class RepositoryImplTest extends TestCase
+{
+
+    public void testReferral1() throws Exception
+    {
+
+        URL url = getClass().getResource("/referral1_repository.xml");
+
+        RepositoryAdminImpl repoAdmin = createRepositoryAdmin();
+        RepositoryImpl repo = (RepositoryImpl) repoAdmin.addRepository(url);
+        Referral[] refs = repo.getReferrals();
+
+        assertNotNull("Expect referrals", refs);
+        assertTrue("Expect one referral", refs.length == 1);
+
+        // <referral depth="1" url="referred.xml" />
+        assertEquals(1, refs[0].getDepth());
+        assertEquals("referred.xml", refs[0].getUrl());
+
+        // expect two resources
+        Resource[] res = repoAdmin.discoverResources(null);
+        assertNotNull("Expect Resource", res);
+        assertEquals("Expect two resources", 2, res.length);
+
+        // first resource is from the referral1_repository.xml
+        assertEquals("6", res[0].getId());
+        assertEquals("referral1_repository", res[0].getRepository().getName());
+
+        // second resource is from the referred.xml
+        assertEquals("99", res[1].getId());
+        assertEquals("referred", res[1].getRepository().getName());
+    }
+
+    public void testReferral2() throws Exception
+    {
+
+        URL url = getClass().getResource("/referral1_repository.xml");
+
+        RepositoryAdminImpl repoAdmin = createRepositoryAdmin();
+        RepositoryImpl repo = (RepositoryImpl) repoAdmin.addRepository(url, 1);
+        Referral[] refs = repo.getReferrals();
+
+        assertNotNull("Expect referrals", refs);
+        assertTrue("Expect one referral", refs.length == 1);
+
+        // <referral depth="1" url="referred.xml" />
+        assertEquals(1, refs[0].getDepth());
+        assertEquals("referred.xml", refs[0].getUrl());
+
+        // expect one resource (referral is not followed
+        Resource[] res = repoAdmin.discoverResources(null);
+        assertNotNull("Expect Resource", res);
+        assertEquals("Expect one resource", 1, res.length);
+
+        // first resource is from the referral1_repository.xml
+        assertEquals("6", res[0].getId());
+        assertEquals("referral1_repository", res[0].getRepository().getName());
+    }
+
+    private RepositoryAdminImpl createRepositoryAdmin()
+    {
+        RepositoryAdminImpl repoAdmin = new RepositoryAdminImpl(new MockBundleContext());
+
+        // force initialization && remove all initial repositories
+        Repository[] repos = repoAdmin.listRepositories();
+        for (int i = 0; repos != null && i < repos.length; i++)
+        {
+            repoAdmin.removeRepository(repos[i].getURL());
+        }
+
+        return repoAdmin;
+    }
+
+    private static class MockBundleContext implements BundleContext
+    {
+
+        public void addBundleListener(BundleListener arg0)
+        {
+        }
+
+        public void addFrameworkListener(FrameworkListener arg0)
+        {
+        }
+
+        public void addServiceListener(ServiceListener arg0)
+        {
+        }
+
+        public void addServiceListener(ServiceListener arg0, String arg1)
+        {
+        }
+
+        public Filter createFilter(String arg0)
+        {
+            // returns a match-all filter always
+            return new Filter()
+            {
+                public boolean matchCase(Dictionary arg0)
+                {
+                    return true;
+                }
+
+                public boolean match(Dictionary arg0)
+                {
+                    return true;
+                }
+
+                public boolean match(ServiceReference arg0)
+                {
+                    return true;
+                }
+            };
+        }
+
+        public ServiceReference[] getAllServiceReferences(String arg0, String arg1)
+        {
+            return null;
+        }
+
+        public Bundle getBundle()
+        {
+            return null;
+        }
+
+        public Bundle getBundle(long arg0)
+        {
+            return null;
+        }
+
+        public Bundle[] getBundles()
+        {
+            return null;
+        }
+
+        public File getDataFile(String arg0)
+        {
+            return null;
+        }
+
+        public String getProperty(String name)
+        {
+            if (RepositoryAdminImpl.REPOSITORY_URL_PROP.equals(name))
+            {
+                URL url = getClass().getResource("/referred.xml");
+                if (url != null)
+                {
+                    return url.toExternalForm();
+                }
+            }
+
+            return null;
+        }
+
+        public Object getService(ServiceReference arg0)
+        {
+            return null;
+        }
+
+        public ServiceReference getServiceReference(String arg0)
+        {
+            return null;
+        }
+
+        public ServiceReference[] getServiceReferences(String arg0, String arg1)
+        {
+            return null;
+        }
+
+        public Bundle installBundle(String arg0)
+        {
+            return null;
+        }
+
+        public Bundle installBundle(String arg0, InputStream arg1)
+        {
+            return null;
+        }
+
+        public ServiceRegistration registerService(String[] arg0, Object arg1, Dictionary arg2)
+        {
+            return null;
+        }
+
+        public ServiceRegistration registerService(String arg0, Object arg1, Dictionary arg2)
+        {
+            return null;
+        }
+
+        public void removeBundleListener(BundleListener arg0)
+        {
+        }
+
+        public void removeFrameworkListener(FrameworkListener arg0)
+        {
+        }
+
+        public void removeServiceListener(ServiceListener arg0)
+        {
+        }
+
+        public boolean ungetService(ServiceReference arg0)
+        {
+            return false;
+        }
+    }
+}
diff --git a/bundlerepository/src/test/resources/referral1_repository.xml b/bundlerepository/src/test/resources/referral1_repository.xml
new file mode 100644
index 0000000..26e640f
--- /dev/null
+++ b/bundlerepository/src/test/resources/referral1_repository.xml
@@ -0,0 +1,9 @@
+<repository lastmodified="20061215121044.644" name="referral1_repository">
+    <referral depth="1" url="referred.xml" />
+
+    <resource id="6" presentationname="0_telnetd"
+        symbolicname="com.softsell.open.osgi.telnetd"
+        uri="http://oscar-osgi.sf.net/obr2/telnetd/telnetd.jar"
+        version="1.0.0" />
+        
+</repository>
\ No newline at end of file
diff --git a/bundlerepository/src/test/resources/referred.xml b/bundlerepository/src/test/resources/referred.xml
new file mode 100644
index 0000000..19ad608
--- /dev/null
+++ b/bundlerepository/src/test/resources/referred.xml
@@ -0,0 +1,8 @@
+<repository lastmodified="20061215121044.644" name="referred">
+
+    <resource id="99" presentationname="1_referredSample"
+        symbolicname="org.sample.referred"
+        uri="referredSample.jar"
+        version="1.0.0" />
+        
+</repository>
\ No newline at end of file