diff --git a/lib/ajv.js b/lib/ajv.js
index 726e4d8fa..c6452a324 100644
--- a/lib/ajv.js
+++ b/lib/ajv.js
@@ -158,9 +158,9 @@ function Ajv(opts) {
             else throw new Error(message);
         }
 
-        resolve.ids.call(self, schema);
+        var localRefs = resolve.ids.call(self, schema);
 
-        var validate = compileSchema.call(self, schema);
+        var validate = compileSchema.call(self, schema, undefined, localRefs);
         if (id[0] != '#') self._refs[id] = validate;
         self._cache.put(str, validate);
 
diff --git a/lib/compile/index.js b/lib/compile/index.js
index b5214b994..07d215eb5 100644
--- a/lib/compile/index.js
+++ b/lib/compile/index.js
@@ -12,7 +12,7 @@ var RULES = require('./rules')
 module.exports = compile;
 
 
-function compile(schema, root) {
+function compile(schema, root, localRefs) {
   var self = this
     , refVal = [ undefined ] 
     , refs = {};
@@ -75,6 +75,12 @@ function compile(schema, root) {
     }
     var v = resolve.call(self, compile, root, ref);
     if (v) return addLocalRef(ref, v);
+
+    var localSchema = localRefs[ref];
+    if (localSchema) {
+      var v = compile.call(self, localSchema, root, localRefs);
+      if (v) return addLocalRef(ref, v);
+    }
   }
 
   function addLocalRef(ref, v) {
diff --git a/lib/compile/resolve.js b/lib/compile/resolve.js
index 00e5ceb9e..97151be03 100644
--- a/lib/compile/resolve.js
+++ b/lib/compile/resolve.js
@@ -117,29 +117,36 @@ function resolveUrl(baseId, id) {
 
 function resolveIds(schema) {
   var id = normalizeId(schema.id);
+  var localRefs = {};
   _resolveIds.call(this, schema, getFullPath(id, false), id);
-}
-
-
-function _resolveIds(schema, fullPath, baseId) {
-  if (Array.isArray(schema))
-    for (var i=0; i<schema.length; i++)
-      _resolveIds.call(this, schema[i], fullPath+'/'+i, baseId);
-  else if (schema && typeof schema == 'object') {
-    if (typeof schema.id == 'string') {
-      var id = baseId = baseId
-                        ? url.resolve(baseId, schema.id)
-                        : getFullPath(schema.id);
-
-      var refVal = this._refs[id];
-      if (typeof refVal == 'string') refVal = this._refs[refVal];
-      if (refVal && refVal.schema) {
-        if (!equal(schema, refVal.schema))
-          throw new Error('id "' + id + '" resolves to more than one schema');
-      } else if (id != normalizeId(fullPath))
-          this._refs[id] = fullPath;
+  return localRefs;
+
+  function _resolveIds(schema, fullPath, baseId) {
+    if (Array.isArray(schema))
+      for (var i=0; i<schema.length; i++)
+        _resolveIds.call(this, schema[i], fullPath+'/'+i, baseId);
+    else if (schema && typeof schema == 'object') {
+      if (typeof schema.id == 'string') {
+        var id = baseId = baseId
+                          ? url.resolve(baseId, schema.id)
+                          : normalizeId(schema.id);
+
+        var refVal = this._refs[id];
+        if (typeof refVal == 'string') refVal = this._refs[refVal];
+        if (refVal && refVal.schema) {
+          if (!equal(schema, refVal.schema))
+            throw new Error('id "' + id + '" resolves to more than one schema');
+        } else if (id != normalizeId(fullPath)) {
+          if (id[0] == '#') {
+            if (localRefs[id] && !equal(schema, localRefs[id]))
+              throw new Error('id "' + id + '" resolves to more than one schema');
+            localRefs[id] = schema;
+          } else
+            this._refs[id] = fullPath;
+        }
+      }
+      for (var key in schema)
+        _resolveIds.call(this, schema[key], fullPath+'/'+escapeFragment(key), baseId);
     }
-    for (var key in schema)
-      _resolveIds.call(this, schema[key], fullPath+'/'+escapeFragment(key), baseId);
   }
 }
diff --git a/package.json b/package.json
index d73335157..41dfa20bb 100644
--- a/package.json
+++ b/package.json
@@ -1,6 +1,6 @@
 {
   "name": "ajv",
-  "version": "0.5.12",
+  "version": "0.6.0",
   "description": "Another JSON Schema Validator",
   "main": "lib/ajv.js",
   "scripts": {
diff --git a/spec/json-schema.spec.js b/spec/json-schema.spec.js
index 163080419..9c08cfe2b 100644
--- a/spec/json-schema.spec.js
+++ b/spec/json-schema.spec.js
@@ -42,8 +42,7 @@ jsonSchemaTest([ ajv, fullAjv ], {
     // 'schemas/complex', 'schemas/basic', 'schemas/advanced',
   ],
   skip: [
-    'optional/zeroTerminatedFloats',
-    'schemas/complex'
+    'optional/zeroTerminatedFloats'
   ],
   cwd: __dirname,
   hideFolder: 'draft4/'
diff --git a/spec/tests/issues/1_ids_in_refs.json b/spec/tests/issues/1_ids_in_refs.json
index fce46e00c..eeddc085e 100644
--- a/spec/tests/issues/1_ids_in_refs.json
+++ b/spec/tests/issues/1_ids_in_refs.json
@@ -1,6 +1,5 @@
 [
   {
-    "skip": true,
     "description": "IDs in refs without root id (#1)",
     "schema": {
       "definitions": {