diff --git a/karma.conf.js b/karma.conf.js
index a859e34edb..613930ae45 100644
--- a/karma.conf.js
+++ b/karma.conf.js
@@ -2,23 +2,73 @@
 var webpack = require('webpack');
 var path = require('path');
 
+/*
+ * It's a pain to have to wait for webpack to build everything; however it's
+ * the easiest way to load our dependencies from node_modules.
+ */
 module.exports = function (config) {
     config.set({
-        browsers: ['Chrome'],
-        singleRun: true,
+        // frameworks to use
+        // available frameworks: https://npmjs.org/browse/keyword/karma-adapter
         frameworks: ['mocha'],
+
+        // list of files / patterns to load in the browser
         files: [
-            'tests/tests.js'
+            'test/tests.js'
         ],
+
+        // preprocess matching files before serving them to the browser
+        // available preprocessors:
+        // https://npmjs.org/browse/keyword/karma-preprocessor
         preprocessors: {
-            'tests/tests.js': ['webpack', 'sourcemap']
+            'test/tests.js': ['webpack', 'sourcemap']
         },
-        reporters: ['dots'],
+
+        // test results reporter to use
+        // possible values: 'dots', 'progress'
+        // available reporters: https://npmjs.org/browse/keyword/karma-reporter
+        reporters: ['progress'],
+
+        // web server port
+        port: 9876,
+
+        // enable / disable colors in the output (reporters and logs)
+        colors: true,
+
+        // level of logging
+        // possible values: config.LOG_DISABLE || config.LOG_ERROR ||
+        // config.LOG_WARN || config.LOG_INFO || config.LOG_DEBUG
+        logLevel: config.LOG_INFO,
+
+        // enable / disable watching file and executing tests whenever any file
+        // changes
+        autoWatch: true,
+
+        // start these browsers
+        // available browser launchers:
+        // https://npmjs.org/browse/keyword/karma-launcher
+        browsers: [
+            'Chrome',
+            //'PhantomJS',
+        ],
+
+        // Continuous Integration mode
+        // if true, Karma captures browsers, runs the tests and exits
+        singleRun: true,
+
+        // Concurrency level
+        // how many browser should be started simultaneous
+        concurrency: Infinity,
+
         webpack: {
             module: {
                 loaders: [
                     { test: /\.json$/, loader: "json" },
-                    { test: /\.js$/, loader: "babel", include: path.resolve('./src') },
+                    { test: /\.js$/, loader: "babel",
+                      include: [path.resolve('./src'),
+                                path.resolve('./test'),
+                               ],
+                    },
                 ],
                 noParse: [
                     // don't parse the languages within highlight.js. They
@@ -32,6 +82,8 @@ module.exports = function (config) {
             resolve: {
                 alias: {
                     'matrix-react-sdk': path.resolve('src/index.js'),
+                    // todo: make this go via an include path?
+                    'test-component-index': path.resolve('test/test-component-index.js'),
                 },
             },
         },
diff --git a/test/components/structures/MatrixChat-test.js b/test/components/structures/MatrixChat-test.js
new file mode 100644
index 0000000000..4d5c368873
--- /dev/null
+++ b/test/components/structures/MatrixChat-test.js
@@ -0,0 +1,22 @@
+var React = require('react');
+var TestUtils = require('react-addons-test-utils');
+var expect = require('expect');
+
+var sdk = require('matrix-react-sdk');
+var MatrixChat;
+
+describe('MatrixChat', function () {
+    before(function() {
+        MatrixChat = sdk.getComponent('structures.MatrixChat');
+    });
+    
+    it('gives a login panel by default', function () {
+        var res = TestUtils.renderIntoDocument(
+                <MatrixChat config={{}}/>
+        );
+
+        // we expect a single <Login> component
+        TestUtils.findRenderedComponentWithType(
+            res, sdk.getComponent('structures.login.Login'));
+    });
+});
diff --git a/tests/tests.js b/test/tests.js
similarity index 86%
rename from tests/tests.js
rename to test/tests.js
index 5a2a44909b..f5b9c36199 100644
--- a/tests/tests.js
+++ b/test/tests.js
@@ -5,7 +5,7 @@
 
 // this is a handly place to make sure the sdk has been skinned
 var sdk = require("matrix-react-sdk");
-sdk.loadSkin(require('../src/component-index'));
+sdk.loadSkin(require('test-component-index'));
 
 var context = require.context('.', true, /-test\.jsx?$/);
 context.keys().forEach(context);
diff --git a/tests/components/structures/MatrixChat-test.js b/tests/components/structures/MatrixChat-test.js
deleted file mode 100644
index 917dbcba18..0000000000
--- a/tests/components/structures/MatrixChat-test.js
+++ /dev/null
@@ -1,11 +0,0 @@
-var React = require('react');
-var expect = require('expect');
-
-var sdk = require("matrix-react-sdk");
-
-var MatrixChat = sdk.getComponent('structures.MatrixChat');
-
-describe('MatrixChat', function () {
-    it('does something', function () {
-    });
-});