diff --git a/src/generators/nodes/EachBlock.ts b/src/generators/nodes/EachBlock.ts
index 6aa9ab673e..ba9ffc11a9 100644
--- a/src/generators/nodes/EachBlock.ts
+++ b/src/generators/nodes/EachBlock.ts
@@ -315,108 +315,16 @@ export default class EachBlock extends Node {
 		`);
 
 		const dynamic = this.block.hasUpdateMethod;
-		let fn_destroy;
-		if (this.block.hasOutroMethod) {
-			fn_destroy = block.getUniqueName(`${each}_outro`);
-			block.builders.init.addBlock(deindent`
-				function ${fn_destroy}(iteration) {
-					iteration.o(function() {
-						iteration.u();
-						iteration.d();
-						${lookup}[iteration.key] = null;
-					});
-				}
-			`);
-		} else {
-			fn_destroy = block.getUniqueName(`${each}_destroy`);
-			block.builders.init.addBlock(deindent`
-				function ${fn_destroy}(iteration) {
-					var first = iteration.first
-					if (first && first.parentNode) {
-						iteration.u();
-					}
-					iteration.d();
-					${lookup}[iteration.key] = null;
-				}
-			`);
-		}
-		const destroy = deindent`
-		${iteration} = ${head};
-		while(${iteration}) {
-			if (!${keep}[${iteration}.key]) {
-				${fn_destroy}(${iteration});
-			}
-			${iteration} = ${iteration}.next;
-		}
-		`;
 
 		block.builders.update.addBlock(deindent`
 			var ${each_block_value} = ${snippet};
-			var ${expected} = ${head};
-			var ${last} = null;
-
-			var ${keep} = {};
-			var ${mounts} = {};
-			var ${next_iteration} = null;
 
-			for (#i = 0; #i < ${each_block_value}.${length}; #i += 1) {
-				var ${key} = ${each_block_value}[#i].${this.key};
-				var ${iteration} = ${lookup}[${key}];
-				var next_data = ${each_block_value}[#i+1];
-				var next = next_data && ${lookup}[next_data.${this.key}];
-
-				var ${this.each_context} = @assign({}, state, {
+			@updateKeyedEach(#component, ${key}, changed, "${this.key}", ${dynamic}, ${each_block_value}, ${head}, ${lookup}, ${updateMountNode}, ${String(this.block.hasOutroMethod)}, ${create_each_block}, "${mountOrIntro}", function(#i) {
+				return @assign({}, state, {
 					${this.contextProps.join(',\n')}
 				});
+			});
 
-				${dynamic &&
-					`if (${iteration}) ${iteration}.p(changed, ${this.each_context});`}
-				if (${expected} && (${key} === ${expected}.key)) {
-					var first = ${iteration} && ${iteration}.first;
-					var parentNode = first && first.parentNode
-					if (!parentNode || (${iteration} && ${iteration}.next) != next) ${mounts}[${key}] = ${iteration};
-					${expected} = ${iteration}.next;
-				} else if (${iteration}) {
-					${mounts}[${key}] = ${iteration};
-					${expected} = ${iteration}.next;
-				} else {
-					// key is being inserted
-					${iteration} = ${lookup}[${key}] = ${create_each_block}(#component, ${key}, ${this.each_context});
-					${iteration}.c();
-					${mounts}[${key}] = ${iteration};
-				}
-				${lookup}[${key}] = ${iteration};
-				${keep}[${iteration}.key] = ${iteration};
-				${last} = ${iteration};
-			}
-			${destroy}
-
-			// Work backwards due to DOM api having insertBefore
-			for (#i = ${each_block_value}.${length} - 1; #i >= 0; #i -= 1) {
-				var data = ${each_block_value}[#i];
-				var ${key} = data.${this.key};
-				${iteration} = ${lookup}[${key}];
-				if (${mounts}[${key}]) {
-					var anchor;
-					${this.block.hasOutroMethod
-						? deindent`
-							var key_next_iteration = ${next_iteration} && ${next_iteration}.key;
-							var iteration_anchor = ${iteration}.next;
-							var key_anchor;
-							do {
-								anchor = iteration_anchor && iteration_anchor.first;
-								iteration_anchor = iteration_anchor && iteration_anchor.next;
-								key_anchor = iteration_anchor && iteration_anchor.key;
-							} while(iteration_anchor && key_anchor != key_next_iteration && !${keep}[key_anchor])`
-						: deindent`
-							anchor = ${next_iteration} && ${next_iteration}.first;
-							` }
-					${mounts}[${key}].${mountOrIntro}(${updateMountNode}, anchor);
-				}
-				${iteration}.next = ${next_iteration};
-				if (${next_iteration}) ${next_iteration}.last = ${iteration};
-				${next_iteration} = ${iteration};
-			}
 			${head} = ${lookup}[${each_block_value}[0] && ${each_block_value}[0].${this.key}];
 		`);
 
diff --git a/src/shared/_build.js b/src/shared/_build.js
index 0339ba558c..3cc523e7cd 100644
--- a/src/shared/_build.js
+++ b/src/shared/_build.js
@@ -5,7 +5,7 @@ const acorn = require('acorn');
 const declarations = {};
 
 fs.readdirSync(__dirname).forEach(file => {
-	if (!/^[a-z]+\.js$/.test(file)) return;
+	if (!/^[a-z\-]+\.js$/.test(file)) return;
 
 	const source = fs.readFileSync(path.join(__dirname, file), 'utf-8');
 	const ast = acorn.parse(source, {
diff --git a/src/shared/index.js b/src/shared/index.js
index ab8a053151..a410e7d9df 100644
--- a/src/shared/index.js
+++ b/src/shared/index.js
@@ -1,6 +1,7 @@
 import { assign } from './utils.js';
 import { noop } from './utils.js';
 export * from './dom.js';
+export * from './keyed-each.js';
 export * from './transitions.js';
 export * from './utils.js';
 
diff --git a/src/shared/keyed-each.js b/src/shared/keyed-each.js
new file mode 100644
index 0000000000..384a96f6ed
--- /dev/null
+++ b/src/shared/keyed-each.js
@@ -0,0 +1,80 @@
+import { assign } from './utils.js';
+
+export function destroyIteration(iteration, lookup) {
+	var first = iteration.first
+	if (first && first.parentNode) {
+		iteration.u();
+	}
+	iteration.d();
+	lookup[iteration.key] = null;
+}
+
+export function outroAndDestroyIteration(iteration, lookup) {
+	iteration.o(function() {
+		iteration.u();
+		iteration.d();
+		lookup[iteration.key] = null;
+	});
+}
+
+// TODO is it possible to avoid mounting iterations that are
+// already in the right place?
+export function updateKeyedEach(component, key, changed, key_prop, dynamic, list, head, lookup, node, has_outro, create_each_block, intro_method, get_context) {
+	var keep = {};
+
+	var i = list.length;
+	while (i--) {
+		var key = list[i][key_prop];
+		var iteration = lookup[key];
+
+		if (iteration) {
+			if (dynamic) iteration.p(changed, get_context(i));
+		} else {
+			iteration = lookup[key] = create_each_block(component, key, get_context(i));
+			iteration.c();
+		}
+
+		lookup[key] = iteration;
+		keep[key] = 1;
+	}
+
+	var destroy = has_outro
+		? outroAndDestroyIteration
+		: destroyIteration;
+
+	iteration = head;
+	while (iteration) {
+		if (!keep[iteration.key]) destroy(iteration, lookup);
+		iteration = iteration.next;
+	}
+
+	var next = null;
+
+	i = list.length;
+	while (i--) {
+		key = list[i][key_prop];
+		iteration = lookup[key];
+
+		var anchor;
+
+		if (has_outro) {
+			var next_key = next && next.key;
+			var neighbour = iteration.next;
+			var anchor_key;
+
+			while (neighbour && anchor_key != next_key && !keep[anchor_key]) {
+				anchor = neighbour && neighbour.first;
+				neighbour = neighbour.next;
+				anchor_key = neighbour && neighbour.key;
+			}
+		} else {
+			anchor = next && next.first;
+		}
+
+		iteration[intro_method](node, anchor);
+
+		iteration.next = next;
+		if (next) next.last = iteration;
+		next = iteration;
+	}
+}
\ No newline at end of file
diff --git a/test/runtime/samples/each-block-keyed-random-permute/_config.js b/test/runtime/samples/each-block-keyed-random-permute/_config.js
index 904208c6a9..164257056f 100644
--- a/test/runtime/samples/each-block-keyed-random-permute/_config.js
+++ b/test/runtime/samples/each-block-keyed-random-permute/_config.js
@@ -1,50 +1,60 @@
-const VALUES = Array.from( 'abcdefghijklmnopqrstuvwxyz' );
+const VALUES = Array.from('abcdefghijklmnopqrstuvwxyz');
 
-function toObjects ( array ) {
-	return array.split( '' ).map( x => ({ id: x }) );
+function toObjects(array) {
+	return array.split('').map(x => ({ id: x }));
 }
 
-function permute () {
+function permute() {
 	const values = VALUES.slice();
 	const number = Math.floor(Math.random() * VALUES.length);
 	const permuted = [];
 	for (let i = 0; i < number; i++) {
-		permuted.push( ...values.splice( Math.floor( Math.random() * ( number - i ) ), 1 ) );
+		permuted.push(
+			...values.splice(Math.floor(Math.random() * (number - i)), 1)
+		);
 	}
 
-	return permuted.join( '' );
+	return permuted.join('');
 }
 
 export default {
 	data: {
-		values: toObjects( 'abc' )
+		values: toObjects('abc'),
 	},
 
 	html: `(a)(b)(c)`,
 
-	test ( assert, component, target ) {
-		function test ( sequence ) {
-			component.set({ values: toObjects( sequence ) });
-			assert.htmlEqual( target.innerHTML, sequence.split( '' ).map( x => `(${x})` ).join( '' ) );
+	test(assert, component, target) {
+		function test(sequence) {
+			const previous = target.textContent;
+			const expected = sequence.split('').map(x => `(${x})`).join('');
+			component.set({ values: toObjects(sequence) });
+			assert.htmlEqual(
+				target.innerHTML,
+				expected,
+				`\n${previous} -> ${expected}\n${target.textContent}`
+			);
 		}
 
 		// first, some fixed tests so that we can debug them
-		test( 'abc' );
-		test( 'abcd' );
-		test( 'abecd' );
-		test( 'fabecd' );
-		test( 'fabed' );
-		test( 'beadf' );
-		test( 'ghbeadf' );
-		test( 'gf' );
-		test( 'gc' );
-		test( 'g' );
-		test( '' );
-		test( 'abc' );
-		test( 'duqbmineapjhtlofrskcg' );
-		test( 'hdnkjougmrvftewsqpailcb' );
+		test('abc');
+		test('abcd');
+		test('abecd');
+		test('fabecd');
+		test('fabed');
+		test('beadf');
+		test('ghbeadf');
+		test('gf');
+		test('gc');
+		test('g');
+		test('');
+		test('abc');
+		test('duqbmineapjhtlofrskcg');
+		test('hdnkjougmrvftewsqpailcb');
+		test('bidhfacge');
+		test('kgjnempcboaflidh');
 
 		// then, we party
-		for ( let i = 0; i < 100; i += 1 ) test( permute() );
+		for (let i = 0; i < 100; i += 1) test(permute());
 	}
 };