diff --git a/cmd/tiller/release_server.go b/cmd/tiller/release_server.go
index 061a76c4b..afe13376e 100644
--- a/cmd/tiller/release_server.go
+++ b/cmd/tiller/release_server.go
@@ -24,7 +24,6 @@ import (
 	"regexp"
 	"sort"
 
-	"github.com/Masterminds/semver"
 	"github.com/ghodss/yaml"
 	"github.com/technosophos/moniker"
 	ctx "golang.org/x/net/context"
@@ -171,65 +170,107 @@ func (s *releaseServer) GetReleaseContent(c ctx.Context, req *services.GetReleas
 }
 
 func (s *releaseServer) UpdateRelease(c ctx.Context, req *services.UpdateReleaseRequest) (*services.UpdateReleaseResponse, error) {
-	rel, err := s.prepareUpdate(req)
+	currentRelease, updatedRelease, err := s.prepareUpdate(req)
 	if err != nil {
 		return nil, err
 	}
 
-	// TODO: perform update
+	res, err := s.performUpdate(currentRelease, updatedRelease, req)
+	if err != nil {
+		return nil, err
+	}
+
+	if err := s.env.Releases.Update(updatedRelease); err != nil {
+		return nil, err
+	}
+
+	return res, nil
+}
+
+func (s *releaseServer) performUpdate(originalRelease, updatedRelease *release.Release, req *services.UpdateReleaseRequest) (*services.UpdateReleaseResponse, error) {
+	res := &services.UpdateReleaseResponse{Release: updatedRelease}
+
+	if req.DryRun {
+		log.Printf("Dry run for %s", updatedRelease.Name)
+		return res, nil
+	}
+
+	// pre-ugrade hooks
+	//if !req.DisableHooks {
+	//if err := s.execHook(updatedRelease.Hooks, updatedRelease.Name, updatedRelease.Namespace, preUpgrade); err != nil {
+	//return res, err
+	//}
+	//}
+
+	kubeCli := s.env.KubeClient
+	original := bytes.NewBufferString(originalRelease.Manifest)
+	modified := bytes.NewBufferString(updatedRelease.Manifest)
+	if err := kubeCli.Update(updatedRelease.Namespace, original, modified); err != nil {
+		return nil, fmt.Errorf("Update of %s failed: %s", updatedRelease.Name, err)
+	}
+
+	// post-upgrade hooks
+	//if !req.DisableHooks {
+	//if err := s.execHook(updatedRelease.Hooks, updatedRelease.Name, updatedRelease.Namespace, postUpgrade); err != nil {
+	//return res, err
+	//}
+	//}
 
-	return &services.UpdateReleaseResponse{Release: rel}, nil
+	updatedRelease.Info.Status.Code = release.Status_DEPLOYED
+
+	return res, nil
 }
 
-// prepareUpdate builds a release for an update operation.
-func (s *releaseServer) prepareUpdate(req *services.UpdateReleaseRequest) (*release.Release, error) {
+// prepareUpdate builds an updated release for an update operation.
+func (s *releaseServer) prepareUpdate(req *services.UpdateReleaseRequest) (*release.Release, *release.Release, error) {
 	if req.Name == "" {
-		return nil, errMissingRelease
+		return nil, nil, errMissingRelease
 	}
 
 	if req.Chart == nil {
-		return nil, errMissingChart
+		return nil, nil, errMissingChart
 	}
 
 	// finds the non-deleted release with the given name
-	rel, err := s.env.Releases.Read(req.Name)
+	currentRelease, err := s.env.Releases.Read(req.Name)
 	if err != nil {
-		return nil, err
+		return nil, nil, err
 	}
 
-	//validate chart name is same as previous release
-	givenChart := req.Chart.Metadata.Name
-	releasedChart := rel.Chart.Metadata.Name
-	if givenChart != releasedChart {
-		return nil, fmt.Errorf("Given chart, %s, does not match chart originally released, %s", givenChart, releasedChart)
+	ts := timeconv.Now()
+	options := chartutil.ReleaseOptions{
+		Name:      req.Name,
+		Time:      ts,
+		Namespace: currentRelease.Namespace,
 	}
 
-	// validate new chart version is higher than old
-
-	givenChartVersion := req.Chart.Metadata.Version
-	releasedChartVersion := rel.Chart.Metadata.Version
-	c, err := semver.NewConstraint("> " + releasedChartVersion)
+	valuesToRender, err := chartutil.ToRenderValues(req.Chart, req.Values, options)
 	if err != nil {
-		return nil, err
+		return nil, nil, err
 	}
 
-	v, err := semver.NewVersion(givenChartVersion)
+	hooks, manifestDoc, err := s.renderResources(req.Chart, valuesToRender)
 	if err != nil {
-		return nil, err
-	}
-
-	if a := c.Check(v); !a {
-		return nil, fmt.Errorf("Given chart (%s-%v) must be a higher version than released chart (%s-%v)", givenChart, givenChartVersion, releasedChart, releasedChartVersion)
+		return nil, nil, err
 	}
 
 	// Store an updated release.
 	updatedRelease := &release.Release{
-		Name:    req.Name,
-		Chart:   req.Chart,
-		Config:  req.Values,
-		Version: rel.Version + 1,
+		Name:      req.Name,
+		Namespace: currentRelease.Namespace,
+		Chart:     req.Chart,
+		Config:    req.Values,
+		Info: &release.Info{
+			FirstDeployed: currentRelease.Info.FirstDeployed,
+			LastDeployed:  ts,
+			Status:        &release.Status{Code: release.Status_UNKNOWN},
+		},
+		Version:  currentRelease.Version + 1,
+		Manifest: manifestDoc.String(),
+		Hooks:    hooks,
 	}
-	return updatedRelease, nil
+
+	return currentRelease, updatedRelease, nil
 }
 
 func (s *releaseServer) uniqName(start string, reuse bool) (string, error) {
@@ -308,12 +349,36 @@ func (s *releaseServer) prepareRelease(req *services.InstallReleaseRequest) (*re
 		return nil, err
 	}
 
-	renderer := s.engine(req.Chart)
-	files, err := renderer.Render(req.Chart, valuesToRender)
+	hooks, manifestDoc, err := s.renderResources(req.Chart, valuesToRender)
 	if err != nil {
 		return nil, err
 	}
 
+	// Store a release.
+	rel := &release.Release{
+		Name:      name,
+		Namespace: req.Namespace,
+		Chart:     req.Chart,
+		Config:    req.Values,
+		Info: &release.Info{
+			FirstDeployed: ts,
+			LastDeployed:  ts,
+			Status:        &release.Status{Code: release.Status_UNKNOWN},
+		},
+		Manifest: manifestDoc.String(),
+		Hooks:    hooks,
+		Version:  1,
+	}
+	return rel, nil
+}
+
+func (s *releaseServer) renderResources(ch *chart.Chart, values chartutil.Values) ([]*release.Hook, *bytes.Buffer, error) {
+	renderer := s.engine(ch)
+	files, err := renderer.Render(ch, values)
+	if err != nil {
+		return nil, nil, err
+	}
+
 	// Sort hooks, manifests, and partials. Only hooks and manifests are returned,
 	// as partials are not used after renderer.Render. Empty manifests are also
 	// removed here.
@@ -321,7 +386,7 @@ func (s *releaseServer) prepareRelease(req *services.InstallReleaseRequest) (*re
 	if err != nil {
 		// By catching parse errors here, we can prevent bogus releases from going
 		// to Kubernetes.
-		return nil, err
+		return nil, nil, err
 	}
 
 	// Aggregate all valid manifests into one big doc.
@@ -331,22 +396,7 @@ func (s *releaseServer) prepareRelease(req *services.InstallReleaseRequest) (*re
 		b.WriteString(file)
 	}
 
-	// Store a release.
-	rel := &release.Release{
-		Name:      name,
-		Namespace: req.Namespace,
-		Chart:     req.Chart,
-		Config:    req.Values,
-		Info: &release.Info{
-			FirstDeployed: ts,
-			LastDeployed:  ts,
-			Status:        &release.Status{Code: release.Status_UNKNOWN},
-		},
-		Manifest: b.String(),
-		Hooks:    hooks,
-		Version:  1,
-	}
-	return rel, nil
+	return hooks, b, nil
 }
 
 // validateYAML checks to see if YAML is well-formed.
diff --git a/cmd/tiller/release_server_test.go b/cmd/tiller/release_server_test.go
index 18c36bd78..a6e6c2fa8 100644
--- a/cmd/tiller/release_server_test.go
+++ b/cmd/tiller/release_server_test.go
@@ -79,8 +79,9 @@ func releaseStub() *release.Release {
 			LastDeployed:  &date,
 			Status:        &release.Status{Code: release.Status_DEPLOYED},
 		},
-		Chart:  chartStub(),
-		Config: &chart.Config{Raw: `name = "value"`},
+		Chart:   chartStub(),
+		Config:  &chart.Config{Raw: `name = "value"`},
+		Version: 1,
 		Hooks: []*release.Hook{
 			{
 				Name:     "test-cm",
@@ -289,6 +290,59 @@ func TestInstallReleaseReuseName(t *testing.T) {
 	}
 }
 
+func TestUpdateRelease(t *testing.T) {
+	c := context.Background()
+	rs := rsFixture()
+	rel := releaseStub()
+	rs.env.Releases.Create(rel)
+
+	req := &services.UpdateReleaseRequest{
+		Name: rel.Name,
+		Chart: &chart.Chart{
+			Metadata: &chart.Metadata{Name: "hello"},
+			Templates: []*chart.Template{
+				{Name: "hello", Data: []byte("hello: world")},
+			},
+		},
+	}
+	res, err := rs.UpdateRelease(c, req)
+	if err != nil {
+		t.Errorf("Failed updated: %s", err)
+	}
+	if res.Release.Name == "" {
+		t.Errorf("Expected release name.")
+	}
+
+	if res.Release.Name != rel.Name {
+		t.Errorf("Updated release name does not match previous release name. Expected %s, got %s", rel.Name, res.Release.Name)
+	}
+
+	if res.Release.Namespace != rel.Namespace {
+		t.Errorf("Expected release namespace '%s', got '%s'.", rel.Namespace, res.Release.Namespace)
+	}
+
+	updated, err := rs.env.Releases.Read(res.Release.Name)
+	if err != nil {
+		t.Errorf("Expected release for %s (%v).", res.Release.Name, rs.env.Releases)
+	}
+
+	if len(res.Release.Manifest) == 0 {
+		t.Errorf("No manifest returned: %v", res.Release)
+	}
+
+	if len(updated.Manifest) == 0 {
+		t.Errorf("Expected manifest in %v", res)
+	}
+
+	if !strings.Contains(updated.Manifest, "---\n# Source: hello/hello\nhello: world") {
+		t.Errorf("unexpected output: %s", rel.Manifest)
+	}
+
+	if res.Release.Version != 2 {
+		t.Errorf("Expected release version to be %v, got %v", 2, res.Release.Version)
+	}
+}
+
 func TestUninstallRelease(t *testing.T) {
 	c := context.Background()
 	rs := rsFixture()