diff --git a/.bzrignore b/.bzrignore
index c3a502a1a4..ab099d3e32 100644
--- a/.bzrignore
+++ b/.bzrignore
@@ -1,2 +1,3 @@
 run_tests.err.log
 .nova-venv
+ChangeLog
diff --git a/MANIFEST.in b/MANIFEST.in
index e917077c52..4eb28bde61 100644
--- a/MANIFEST.in
+++ b/MANIFEST.in
@@ -1,5 +1,6 @@
 include HACKING LICENSE run_tests.py run_tests.sh 
 include README builddeb.sh exercise_rsapi.py
+include ChangeLog
 graft CA
 graft doc
 graft smoketests
diff --git a/setup.py b/setup.py
index 50d5f2a3d9..0fd286f7d2 100644
--- a/setup.py
+++ b/setup.py
@@ -17,6 +17,24 @@
 #    under the License.
 
 from setuptools import setup, find_packages
+from setuptools.command.sdist import sdist
+
+import os
+import subprocess
+
+
+class local_sdist(sdist):
+    """Customized sdist hook - builds the ChangeLog file from VC first"""
+
+    def run(self):
+        if os.path.isdir('.bzr'):
+            # We're in a bzr branch
+            log_cmd = subprocess.Popen(["bzr", "log", "--gnu"],
+                                       stdout=subprocess.PIPE)
+            changelog = log_cmd.communicate()[0]
+            with open("ChangeLog", "w") as changelog_file:
+                changelog_file.write(changelog)
+        sdist.run(self)
 
 setup(name='nova',
       version='0.9.1',
@@ -24,7 +42,8 @@ setup(name='nova',
       author='OpenStack',
       author_email='nova@lists.launchpad.net',
       url='http://www.openstack.org/',
-      packages = find_packages(exclude=['bin','smoketests']),
+      cmdclass={'sdist': local_sdist},
+      packages=find_packages(exclude=['bin', 'smoketests']),
       scripts=['bin/nova-api',
                'bin/nova-compute',
                'bin/nova-dhcpbridge',
@@ -34,6 +53,4 @@ setup(name='nova',
                'bin/nova-network',
                'bin/nova-objectstore',
                'bin/nova-rsapi',
-               'bin/nova-volume',
-      ]
-     )
+               'bin/nova-volume'])