diff --git a/features/post_data.feature b/features/post_data.feature
index 6d92b19e..c72f52fa 100644
--- a/features/post_data.feature
+++ b/features/post_data.feature
@@ -70,6 +70,18 @@ Feature: Post data
     Then the _site directory should exist
     And I should see "Post category: movies" in "_site/movies/2009/03/27/star-wars.html"
 
+  Scenario: Use post.categories variable when category is in a folder and has categories in YAML
+    Given I have a movies directory
+    And I have a movies/_posts directory
+    And I have a _layouts directory
+    And I have the following post in "movies":
+      | title     | date       | layout | categories | content                 |
+      | Star Wars | 2009-03-27 | simple | [film]     | Luke, I am your father. |
+    And I have a simple layout that contains "Post category: {{ page.categories }}"
+    When I run jekyll build
+    Then the _site directory should exist
+    And I should see "Post category: movies" in "_site/movies/film/2009/03/27/star-wars.html"
+
   Scenario: Use post.tags variable
     Given I have a _posts directory
     And I have a _layouts directory
diff --git a/lib/jekyll/post.rb b/lib/jekyll/post.rb
index 9c75efc6..6cd6e938 100644
--- a/lib/jekyll/post.rb
+++ b/lib/jekyll/post.rb
@@ -77,9 +77,8 @@ module Jekyll
     end
 
     def populate_categories
-      if categories.empty?
-        self.categories = Utils.pluralized_array_from_hash(data, 'category', 'categories').map {|c| c.to_s.downcase}
-      end
+      categories_from_data = Utils.pluralized_array_from_hash(data, 'category', 'categories')
+      self.categories = (Array(categories) + categories_from_data).map {|c| c.to_s.downcase}
       categories.flatten!
     end
 
diff --git a/test/test_post.rb b/test/test_post.rb
index 610fb918..5e264ea7 100644
--- a/test/test_post.rb
+++ b/test/test_post.rb
@@ -666,7 +666,7 @@ class TestPost < Test::Unit::TestCase
     end
 
   end
-  
+
   context "site config with category" do
     setup do
       config = Jekyll::Configuration::DEFAULTS.merge({
@@ -686,7 +686,7 @@ class TestPost < Test::Unit::TestCase
       post = setup_post("2009-01-27-no-category.textile")
       assert post.categories.include?('article'), "Expected post.categories to include 'article' but did not."
     end
-    
+
     should "override site category if set on post" do
       post = setup_post("2009-01-27-category.textile")
       assert post.categories.include?('foo'), "Expected post.categories to include 'foo' but did not."
@@ -713,7 +713,7 @@ class TestPost < Test::Unit::TestCase
       post = setup_post("2009-01-27-no-category.textile")
       assert post.categories.include?('article'), "Expected post.categories to include 'article' but did not."
     end
-    
+
     should "override site categories if set on post" do
       post = setup_post("2009-01-27-categories.textile")
       ['foo', 'bar', 'baz'].each do |category|