diff --git a/CHANGES b/CHANGES
index 3490f0e2..7336c377 100644
--- a/CHANGES
+++ b/CHANGES
@@ -11,6 +11,10 @@ Codename to be decided, release date to be announced.
 - fixed a bug with subdomains that was caused by the inability to
   specify the server name.  The server name can now be set with
   the `SERVER_NAME` config key.
+- autoescaping is no longer active for all templates.  Instead it
+  is only active for ``.html``, ``.htm``, ``.xml`` and ``.xhtml``.
+  Inside templates this behaviour can be changed with the
+  ``autoescape`` tag.
 
 Version 0.4
 -----------
diff --git a/docs/quickstart.rst b/docs/quickstart.rst
index a4858f1c..e1fdce51 100644
--- a/docs/quickstart.rst
+++ b/docs/quickstart.rst
@@ -414,6 +414,13 @@ Markup(u'<blink>hacker</blink>')
 >>> Markup('<em>Marked up</em> &raquo; HTML').striptags()
 u'Marked up \xbb HTML'
 
+.. versionchanged:: 0.5
+
+   Autoescaping is no longer enabled for all templates.  The following
+   extensions for templates trigger autoescaping: ``.html``, ``.htm``,
+   ``.xml``, ``.xhtml``.  Templates loaded from string will have
+   autoescaping disabled.
+
 .. [#] Unsure what that :class:`~flask.g` object is? It's something you
    can store information on yourself, check the documentation of that
    object (:class:`~flask.g`) and the :ref:`sqlite3` for more
diff --git a/flask.py b/flask.py
index 9c720ef0..c55838dc 100644
--- a/flask.py
+++ b/flask.py
@@ -788,6 +788,15 @@ class Config(dict):
         return '<%s %s>' % (self.__class__.__name__, dict.__repr__(self))
 
 
+def _select_autoescape(filename):
+    """Returns `True` if autoescaping should be active for the given
+    template name.
+    """
+    if filename is None:
+        return False
+    return filename.endswith(('.html', '.htm', '.xml', '.xhtml'))
+
+
 class Flask(_PackageBoundObject):
     """The flask object implements a WSGI application and acts as the central
     object.  It is passed the name of the module or package of the
@@ -920,7 +929,7 @@ class Flask(_PackageBoundObject):
 
     #: Options that are passed directly to the Jinja2 environment.
     jinja_options = ImmutableDict(
-        autoescape=True,
+        autoescape=_select_autoescape,
         extensions=['jinja2.ext.autoescape', 'jinja2.ext.with_']
     )
 
@@ -1018,13 +1027,8 @@ class Flask(_PackageBoundObject):
         #: The Jinja2 environment.  It is created from the
         #: :attr:`jinja_options` and the loader that is returned
         #: by the :meth:`create_jinja_loader` function.
-        self.jinja_env = Environment(loader=self.create_jinja_loader(),
-                                     **self.jinja_options)
-        self.jinja_env.globals.update(
-            url_for=url_for,
-            get_flashed_messages=get_flashed_messages
-        )
-        self.jinja_env.filters['tojson'] = _tojson_filter
+        self.jinja_env = self.create_jinja_environment()
+        self.init_jinja_globals()
 
     @property
     def logger(self):
@@ -1061,6 +1065,15 @@ class Flask(_PackageBoundObject):
             self._logger = logger
             return logger
 
+    def create_jinja_environment(self):
+        """Creates the Jinja2 environment based on :attr:`jinja_options`
+        and :meth:`create_jinja_loader`.
+
+        .. versionadded:: 0.5
+        """
+        return Environment(loader=self.create_jinja_loader(),
+                           **self.jinja_options)
+
     def create_jinja_loader(self):
         """Creates the Jinja loader.  By default just a package loader for
         the configured package is returned that looks up templates in the
@@ -1071,6 +1084,19 @@ class Flask(_PackageBoundObject):
             return FileSystemLoader(os.path.join(self.root_path, 'templates'))
         return PackageLoader(self.import_name)
 
+    def init_jinja_globals(self):
+        """Callde directly after the environment was created to inject
+        some defaults (like `url_for`, `get_flashed_messages` and the
+        `tojson` filter.
+
+        .. versionadded:: 0.5
+        """
+        self.jinja_env.globals.update(
+            url_for=url_for,
+            get_flashed_messages=get_flashed_messages
+        )
+        self.jinja_env.filters['tojson'] = _tojson_filter
+
     def update_template_context(self, context):
         """Update the template context with some commonly used variables.
         This injects request, session and g into the template context.
diff --git a/tests/flask_tests.py b/tests/flask_tests.py
index 1c5dc729..4309f214 100644
--- a/tests/flask_tests.py
+++ b/tests/flask_tests.py
@@ -461,6 +461,14 @@ class TemplatingTestCase(unittest.TestCase):
             '<p>Hello World!'
         ]
 
+    def test_no_escaping(self):
+        app = flask.Flask(__name__)
+        with app.test_request_context():
+            assert flask.render_template_string('{{ foo }}',
+                foo='<test>') == '<test>'
+            assert flask.render_template('mail.txt', foo='<test>') \
+                == '<test> Mail'
+
     def test_macros(self):
         app = flask.Flask(__name__)
         with app.test_request_context():
diff --git a/tests/templates/mail.txt b/tests/templates/mail.txt
new file mode 100644
index 00000000..d6cb92ea
--- /dev/null
+++ b/tests/templates/mail.txt
@@ -0,0 +1 @@
+{{ foo}} Mail