diff --git a/lib/cmd/install.js b/lib/cmd/install.js
index 07d43d0dbf..1d4da904db 100644
--- a/lib/cmd/install.js
+++ b/lib/cmd/install.js
@@ -8,6 +8,7 @@ var logger = require('../logger')
 var installMultiple = require('../install_multiple')
 var config = require('../config')
 var save = require('../save')
+var linkPeers = require('../install/link_peers')
 
 /*
  * Perform
@@ -20,9 +21,10 @@ function run (cli) {
   var installType
 
   return readPkgUp()
-    .then(pkg_ => { pkg = pkg_ })
+    .then(_ => { pkg = _ })
     .then(_ => updateContext(pkg.path))
     .then(_ => install())
+    .then(_ => linkPeers(pkg, ctx.store, ctx.installs))
 
   function install () {
     installType = cli.input && cli.input.length ? 'named' : 'general'
diff --git a/lib/fs/unsymlink.js b/lib/fs/unsymlink.js
new file mode 100644
index 0000000000..d3a0480bda
--- /dev/null
+++ b/lib/fs/unsymlink.js
@@ -0,0 +1,16 @@
+var fs = require('mz/fs')
+
+/*
+ * Removes a symlink
+ */
+
+module.exports = function unsymlink (path) {
+  return fs.lstat(path)
+  .then(stat => {
+    if (stat.isSymbolicLink()) return fs.unlink(path)
+    throw new Error('Can\'t unlink ' + path)
+  })
+  .catch(err => {
+    if (err.code !== 'ENOENT') throw err
+  })
+}
diff --git a/lib/install/link_peers.js b/lib/install/link_peers.js
new file mode 100644
index 0000000000..093e1eb511
--- /dev/null
+++ b/lib/install/link_peers.js
@@ -0,0 +1,39 @@
+var Promise = require('../promise')
+var mkdirp = require('../mkdirp')
+var unsymlink = require('../fs/unsymlink')
+var relSymlink = require('../rel_symlink')
+var join = require('path').join
+var semver = require('semver')
+
+/*
+ * Links into `.store/node_modules`
+ */
+
+module.exports = function linkPeers (pkg, store, installs) {
+  var peers = {}
+  var roots = {}
+
+  Object.keys(installs).forEach(name => {
+    var pkgData = installs[name]
+    var realname = pkgData.name
+
+    if (pkgData.keypath.length === 0) {
+      roots[realname] = pkgData
+    } else if (!peers[realname] ||
+      semver.gt(pkgData.version, peers[realname].version)) {
+      peers[realname] = pkgData
+    }
+  })
+
+  var modules = join(store, 'node_modules')
+  return mkdirp(modules)
+    .then(_ => Promise.all(Object.keys(roots).map(name =>
+      unsymlink(join(modules, roots[name].name))
+    )))
+    .then(_ => Promise.all(Object.keys(peers).map(name =>
+      relSymlink(
+        join('..', peers[name].fullname),
+        join(modules, peers[name].name))
+    )))
+}
+
diff --git a/test/index.js b/test/index.js
index b9e0ed5973..c009fa982c 100644
--- a/test/index.js
+++ b/test/index.js
@@ -4,7 +4,8 @@ var fs = require('fs')
 var prepare = require('./support/prepare')
 var install = require('../lib/cmd/install')
 require('./support/sepia')
-var stat
+
+var stat, _
 
 test('eslint', require('tape-eslint')())
 
@@ -30,7 +31,7 @@ test('no dependencies (lodash)', function (t) {
   prepare()
   install({ input: ['lodash@4.0.0'], flags: { quiet: true } })
   .then(function () {
-    var _ = require(join(process.cwd(), 'node_modules', 'lodash'))
+    _ = require(join(process.cwd(), 'node_modules', 'lodash'))
     t.ok(typeof _ === 'function', '_ is available')
     t.ok(typeof _.clone === 'function', '_.clone is available')
     t.end()
@@ -41,7 +42,7 @@ test('scoped modules without version spec (@rstacruz/tap-spec)', function (t) {
   prepare()
   install({ input: ['@rstacruz/tap-spec'], flags: { quiet: true } })
   .then(function () {
-    var _ = require(join(process.cwd(), 'node_modules', '@rstacruz/tap-spec'))
+    _ = require(join(process.cwd(), 'node_modules', '@rstacruz/tap-spec'))
     t.ok(typeof _ === 'function', 'tap-spec is available')
     t.end()
   }, t.end)
@@ -51,7 +52,7 @@ test('scoped modules with versions (@rstacruz/tap-spec@4.1.1)', function (t) {
   prepare()
   install({ input: ['@rstacruz/tap-spec@4.1.1'], flags: { quiet: true } })
   .then(function () {
-    var _ = require(join(process.cwd(), 'node_modules', '@rstacruz/tap-spec'))
+    _ = require(join(process.cwd(), 'node_modules', '@rstacruz/tap-spec'))
     t.ok(typeof _ === 'function', 'tap-spec is available')
     t.end()
   }, t.end)
@@ -61,7 +62,7 @@ test('scoped modules (@rstacruz/tap-spec@*)', function (t) {
   prepare()
   install({ input: ['@rstacruz/tap-spec@*'], flags: { quiet: true } })
   .then(function () {
-    var _ = require(join(process.cwd(), 'node_modules', '@rstacruz/tap-spec'))
+    _ = require(join(process.cwd(), 'node_modules', '@rstacruz/tap-spec'))
     t.ok(typeof _ === 'function', 'tap-spec is available')
     t.end()
   }, t.end)
@@ -71,7 +72,7 @@ test('multiple scoped modules (@rstacruz/...)', function (t) {
   prepare()
   install({ input: ['@rstacruz/tap-spec@*', '@rstacruz/travis-encrypt@*'], flags: { quiet: true } })
   .then(function () {
-    var _ = require(join(process.cwd(), 'node_modules', '@rstacruz/tap-spec'))
+    _ = require(join(process.cwd(), 'node_modules', '@rstacruz/tap-spec'))
     t.ok(typeof _ === 'function', 'tap-spec is available')
     _ = require(join(process.cwd(), 'node_modules', '@rstacruz/travis-encrypt'))
     t.ok(typeof _ === 'function', 'travis-encrypt is available')
@@ -215,3 +216,38 @@ test('multiple save to package.json with `exact` versions (@rstacruz/tap-spec &
     t.end()
   }, t.end)
 })
+
+test('flattening symlinks (minimatch@3.0.0)', function (t) {
+  prepare()
+  install({ input: ['minimatch@3.0.0'], flags: { quiet: true } })
+  .then(function () {
+    stat = fs.lstatSync(join(process.cwd(), 'node_modules', '.store', 'node_modules', 'balanced-match'))
+    t.ok(stat.isSymbolicLink(), 'balanced-match is linked into store node_modules')
+
+    _ = exists(join(process.cwd(), 'node_modules', 'balanced-match'))
+    t.ok(!_, 'balanced-match is not linked into main node_modules')
+    t.end()
+  }, t.end)
+})
+
+test('flattening symlinks (minimatch + balanced-match)', function (t) {
+  prepare()
+  install({ input: ['minimatch@3.0.0'], flags: { quiet: true } })
+  .then(_ => install({ input: ['balanced-match@^0.3.0'], flags: { quiet: true } }))
+  .then(function () {
+    _ = exists(join(process.cwd(), 'node_modules', '.store', 'node_modules', 'balanced-match'))
+    t.ok(!_, 'balanced-match is removed from store node_modules')
+
+    _ = exists(join(process.cwd(), 'node_modules', 'balanced-match'))
+    t.ok(_, 'balanced-match now in main node_modules')
+    t.end()
+  }, t.end)
+})
+
+function exists (path) {
+  try {
+    return fs.statSync(path)
+  } catch (err) {
+    if (err.code !== 'ENOENT') throw err
+  }
+}