diff --git a/test/test.html b/test/test.html
index c174ea0a6..1ac56f9be 100644
--- a/test/test.html
+++ b/test/test.html
@@ -30,5 +30,12 @@
     find the intersection of two thousand-element arrays in one second.
   </h2>
   <br />
+
+  <script type="text/html" id="template">
+      <%
+      if (data) { data += 12345; }; %>
+      <li><%= data %></li>
+  </script>a
+
 </body>
 </html>
diff --git a/test/utility.js b/test/utility.js
index 94f225a80..fdd9b5cec 100644
--- a/test/utility.js
+++ b/test/utility.js
@@ -87,6 +87,9 @@ $(document).ready(function() {
     var withNewlinesAndTabs = _.template('This\n\t\tis: <%= x %>.\n\tok.\nend.');
     equals(withNewlinesAndTabs({x: 'that'}), 'This\n\t\tis: that.\n\tok.\nend.');
 
+    var fromHTML = _.template($('#template').html());
+    equals(fromHTML({data : 12345}).replace(/\s/g, ''), '<li>24690</li>');
+
     _.templateSettings = {
       evaluate    : /\{\{(.+?)\}\}/g,
       interpolate : /\{\{=(.+?)\}\}/g
diff --git a/underscore.js b/underscore.js
index 3c1d4d844..31b0b060e 100644
--- a/underscore.js
+++ b/underscore.js
@@ -623,8 +623,8 @@
   // By default, Underscore uses ERB-style template delimiters, change the
   // following template settings to use alternative delimiters.
   _.templateSettings = {
-    evaluate    : /<%(.+?)%>/gm,
-    interpolate : /<%=(.+?)%>/gm
+    evaluate    : /<%([\s\S]+?)%>/g,
+    interpolate : /<%=([\s\S]+?)%>/g
   };
 
   // JavaScript templating a-la ERB, pilfered from John Resig's