diff --git a/index.mjs b/index.mjs
index 1ba5890537..768b53f626 100644
--- a/index.mjs
+++ b/index.mjs
@@ -3,6 +3,8 @@ export {
 	onDestroy,
 	beforeUpdate,
 	afterUpdate,
+	setContext,
+	getContext,
 	nextTick,
 	createEventDispatcher
 } from './internal';
diff --git a/src/internal/Component.js b/src/internal/Component.js
index 223e00687f..8a87654eb7 100644
--- a/src/internal/Component.js
+++ b/src/internal/Component.js
@@ -54,7 +54,7 @@ function make_dirty(component, key) {
 }
 
 export function init(component, options, instance, create_fragment, not_equal) {
-	const previous_component = current_component;
+	const parent_component = current_component;
 	set_current_component(component);
 
 	const props = options.props || {};
@@ -64,7 +64,6 @@ export function init(component, options, instance, create_fragment, not_equal) {
 		ctx: null,
 
 		// state
-		set: noop,
 		update: noop,
 		not_equal,
 		bound: blankObject(),
@@ -74,6 +73,7 @@ export function init(component, options, instance, create_fragment, not_equal) {
 		on_destroy: [],
 		before_render: [],
 		after_render: [],
+		context: new Map(parent_component ? parent_component.$$.context : []),
 
 		// everything else
 		callbacks: blankObject(),
@@ -115,7 +115,7 @@ export function init(component, options, instance, create_fragment, not_equal) {
 		flush();
 	}
 
-	set_current_component(previous_component);
+	set_current_component(parent_component);
 }
 
 export let SvelteElement;
diff --git a/src/internal/lifecycle.js b/src/internal/lifecycle.js
index e413f4c8f4..02fc2161e1 100644
--- a/src/internal/lifecycle.js
+++ b/src/internal/lifecycle.js
@@ -4,20 +4,25 @@ export function set_current_component(component) {
 	current_component = component;
 }
 
+function get_current_component() {
+	if (!current_component) throw new Error(`Function called outside component initialization`);
+	return current_component;
+}
+
 export function beforeUpdate(fn) {
-	current_component.$$.before_render.push(fn);
+	get_current_component().$$.before_render.push(fn);
 }
 
 export function onMount(fn) {
-	current_component.$$.on_mount.push(fn);
+	get_current_component().$$.on_mount.push(fn);
 }
 
 export function afterUpdate(fn) {
-	current_component.$$.after_render.push(fn);
+	get_current_component().$$.after_render.push(fn);
 }
 
 export function onDestroy(fn) {
-	current_component.$$.on_destroy.push(fn);
+	get_current_component().$$.on_destroy.push(fn);
 }
 
 export function createEventDispatcher() {
@@ -37,6 +42,14 @@ export function createEventDispatcher() {
 	};
 }
 
+export function setContext(key, context) {
+	get_current_component().$$.context.set(key, context);
+}
+
+export function getContext(key) {
+	return get_current_component().$$.context.get(key);
+}
+
 // TODO figure out if we still want to support
 // shorthand events, or if we want to implement
 // a real bubbling mechanism
diff --git a/src/internal/scheduler.js b/src/internal/scheduler.js
index 0626db2a97..4d9f9ad388 100644
--- a/src/internal/scheduler.js
+++ b/src/internal/scheduler.js
@@ -1,4 +1,5 @@
 import { run_all } from './utils.js';
+import { set_current_component } from './lifecycle.js';
 
 export let dirty_components = [];
 export const intros = { enabled: false };
@@ -34,7 +35,9 @@ export function flush() {
 		// first, call beforeUpdate functions
 		// and update components
 		while (dirty_components.length) {
-			update(dirty_components.shift().$$);
+			const component = dirty_components.shift();
+			set_current_component(component);
+			update(component.$$);
 		}
 
 		while (binding_callbacks.length) binding_callbacks.shift()();
diff --git a/src/internal/ssr.js b/src/internal/ssr.js
index 170f841ec6..762c01a3c5 100644
--- a/src/internal/ssr.js
+++ b/src/internal/ssr.js
@@ -1,4 +1,4 @@
-import { set_current_component } from './lifecycle.js';
+import { set_current_component, current_component } from './lifecycle.js';
 import { run_all, blankObject } from './utils.js';
 
 export const invalidAttributeNameCharacter = /[\s'">\/=\u{FDD0}-\u{FDEF}\u{FFFE}\u{FFFF}\u{1FFFE}\u{1FFFF}\u{2FFFE}\u{2FFFF}\u{3FFFE}\u{3FFFF}\u{4FFFE}\u{4FFFF}\u{5FFFE}\u{5FFFF}\u{6FFFE}\u{6FFFF}\u{7FFFE}\u{7FFFF}\u{8FFFE}\u{8FFFF}\u{9FFFE}\u{9FFFF}\u{AFFFE}\u{AFFFF}\u{BFFFE}\u{BFFFF}\u{CFFFE}\u{CFFFF}\u{DFFFE}\u{DFFFF}\u{EFFFE}\u{EFFFF}\u{FFFFE}\u{FFFFF}\u{10FFFE}\u{10FFFF}]/u;
@@ -68,6 +68,8 @@ export function debug(file, line, column, values) {
 export function create_ssr_component($$render) {
 	return {
 		render: (props = {}, options = {}) => {
+			const parent_component = current_component;
+
 			// TODO do we need on_ready, since on_mount,
 			// before_render and after_render don't run?
 			const $$ = {
@@ -75,6 +77,7 @@ export function create_ssr_component($$render) {
 				on_destroy: [],
 				before_render: [],
 				after_render: [],
+				context: new Map(parent_component ? parent_component.$$.context : []),
 				callbacks: blankObject()
 			};
 
diff --git a/test/runtime/samples/context-api/Tab.html b/test/runtime/samples/context-api/Tab.html
index 720d5da9de..2f9793aed8 100644
--- a/test/runtime/samples/context-api/Tab.html
+++ b/test/runtime/samples/context-api/Tab.html
@@ -12,6 +12,6 @@
 	});
 </script>
 
-<button class:selected={$selectedTab} on:click="{() => selectTab(tab)}">
+<button class:selected="{$selectedTab === tab}" on:click="{() => selectTab(tab)}">
 	<slot></slot>
 </button>
\ No newline at end of file
diff --git a/test/runtime/samples/context-api/TabPanel.html b/test/runtime/samples/context-api/TabPanel.html
index 7802ffac26..e15dfca021 100644
--- a/test/runtime/samples/context-api/TabPanel.html
+++ b/test/runtime/samples/context-api/TabPanel.html
@@ -11,6 +11,6 @@
 	});
 </script>
 
-{#if $selected === panel}
+{#if $selectedPanel === panel}
 	<slot></slot>
 {/if}
\ No newline at end of file
diff --git a/test/runtime/samples/context-api/Tabs.html b/test/runtime/samples/context-api/Tabs.html
index 8bbe89a017..6692bb31e9 100644
--- a/test/runtime/samples/context-api/Tabs.html
+++ b/test/runtime/samples/context-api/Tabs.html
@@ -10,36 +10,40 @@
 
 	const tabs = [];
 	const panels = [];
-	const selected = writable(null);
+	const selectedTab = writable(null);
+	const selectedPanel = writable(null);
 
 	setContext(TABS, {
 		registerTab: tab => {
 			tabs.push(tab);
+			selectedTab.update(current => current || tab);
 		},
 
 		unregisterTab: tab => {
 			const i = tabs.indexOf(tab);
 			tabs.splice(i, 1);
+			selectedTab.update(current => current === tab ? (tabs[i] || tabs[tabs.length - 1]) : current);
 		},
 
 		registerPanel: panel => {
 			panels.push(panel);
-
-			// if this is the first panel, select it
-			selected.update(current => current || panel);
+			selectedPanel.update(current => current || panel);
 		},
 
 		unregisterPanel: panel => {
 			const i = panels.indexOf(panel);
 			panels.splice(i, 1);
+			selectedPanel.update(current => current === panel ? (panels[i] || panels[panels.length - 1]) : current);
 		},
 
 		selectTab: tab => {
 			const i = tabs.indexOf(tab);
-			selected.set(panels[i]);
+			selectedTab.set(tab);
+			selectedPanel.set(panels[i]);
 		},
 
-		selected
+		selectedTab,
+		selectedPanel
 	});
 </script>
 
diff --git a/test/runtime/samples/context-api/_config.js b/test/runtime/samples/context-api/_config.js
index 0a8c2f1780..1bc475a156 100644
--- a/test/runtime/samples/context-api/_config.js
+++ b/test/runtime/samples/context-api/_config.js
@@ -19,7 +19,7 @@ export default {
 		assert.htmlEqual(target.innerHTML, `
 			<div class="tabs">
 				<div class="tab-list">
-					<button>small</button>
+					<button class="">small</button>
 					<button class="selected">large</button>
 				</div>
 
@@ -32,7 +32,7 @@ export default {
 		assert.htmlEqual(target.innerHTML, `
 			<div class="tabs">
 				<div class="tab-list">
-					<button>small</button>
+					<button class="">small</button>
 					<button>medium</button>
 					<button class="selected">large</button>
 				</div>
@@ -48,9 +48,9 @@ export default {
 		assert.htmlEqual(target.innerHTML, `
 			<div class="tabs">
 				<div class="tab-list">
-					<button>small</button>
+					<button class="">small</button>
 					<button class="selected">medium</button>
-					<button>large</button>
+					<button class="">large</button>
 				</div>
 
 				<h2>Medium panel</h2>
@@ -62,7 +62,7 @@ export default {
 		assert.htmlEqual(target.innerHTML, `
 			<div class="tabs">
 				<div class="tab-list">
-					<button>small</button>
+					<button class="">small</button>
 					<button class="selected">large</button>
 				</div>