diff --git a/cloud/amazon/elasticache.py b/cloud/amazon/elasticache.py
index 4e76d593cc9..18be34560a5 100644
--- a/cloud/amazon/elasticache.py
+++ b/cloud/amazon/elasticache.py
@@ -58,6 +58,12 @@ options:
       - The port number on which each of the cache nodes will accept connections
     required: false
     default: 11211
+  cache_subnet_group:
+    description:
+      - The subnet group name to associate with. Only use if inside a vpc. Required if inside a vpc
+    required: conditional
+    default: None
+    version_added: "1.7"
   security_group_ids:
     description:
       - A list of vpc security group names to associate with this cache cluster. Only use if inside a vpc
@@ -66,7 +72,7 @@ options:
     version_added: "1.6"
   cache_security_groups:
     description:
-      - A list of cache security group names to associate with this cache cluster
+      - A list of cache security group names to associate with this cache cluster. Must be an empty list if inside a vpc
     required: false
     default: ['default']
   zone:
@@ -155,7 +161,8 @@ class ElastiCacheManager(object):
     EXIST_STATUSES = ['available', 'creating', 'rebooting', 'modifying']
 
     def __init__(self, module, name, engine, cache_engine_version, node_type,
-                 num_nodes, cache_port, cache_security_groups, security_group_ids, zone, wait,
+                 num_nodes, cache_port, cache_subnet_group,
+                 cache_security_groups, security_group_ids, zone, wait,
                  hard_modify, aws_access_key, aws_secret_key, region):
         self.module = module
         self.name = name
@@ -164,6 +171,7 @@ class ElastiCacheManager(object):
         self.node_type = node_type
         self.num_nodes = num_nodes
         self.cache_port = cache_port
+        self.cache_subnet_group = cache_subnet_group
         self.cache_security_groups = cache_security_groups
         self.security_group_ids = security_group_ids
         self.zone = zone
@@ -222,6 +230,7 @@ class ElastiCacheManager(object):
                                                       engine_version=self.cache_engine_version,
                                                       cache_security_group_names=self.cache_security_groups,
                                                       security_group_ids=self.security_group_ids,
+                                                      cache_subnet_group_name=self.cache_subnet_group,
                                                       preferred_availability_zone=self.zone,
                                                       port=self.cache_port)
         except boto.exception.BotoServerError, e:
@@ -476,6 +485,7 @@ class ElastiCacheManager(object):
 
 def main():
     argument_spec = ec2_argument_spec()
+    default = object()
     argument_spec.update(dict(
             state={'required': True, 'choices': ['present', 'absent', 'rebooted']},
             name={'required': True},
@@ -484,7 +494,8 @@ def main():
             node_type={'required': False, 'default': 'cache.m1.small'},
             num_nodes={'required': False, 'default': None, 'type': 'int'},
             cache_port={'required': False, 'default': 11211, 'type': 'int'},
-            cache_security_groups={'required': False, 'default': ['default'],
+            cache_subnet_group={'required': False, 'default': None},
+            cache_security_groups={'required': False, 'default': [default],
                                    'type': 'list'},
             security_group_ids={'required': False, 'default': [],
                                    'type': 'list'},
@@ -507,12 +518,21 @@ def main():
     node_type = module.params['node_type']
     num_nodes = module.params['num_nodes']
     cache_port = module.params['cache_port']
+    cache_subnet_group = module.params['cache_subnet_group']
     cache_security_groups = module.params['cache_security_groups']
     security_group_ids = module.params['security_group_ids']
     zone = module.params['zone']
     wait = module.params['wait']
     hard_modify = module.params['hard_modify']
 
+    if cache_subnet_group and cache_security_groups == [default]:
+        cache_security_groups = []
+    if cache_subnet_group and cache_security_groups:
+        module.fail_json(msg="Can't specify both cache_subnet_group and cache_security_groups")
+
+    if cache_security_groups == [default]:
+        cache_security_groups = ['default']
+
     if state == 'present' and not num_nodes:
         module.fail_json(msg="'num_nodes' is a required parameter. Please specify num_nodes > 0")
 
@@ -522,6 +542,7 @@ def main():
     elasticache_manager = ElastiCacheManager(module, name, engine,
                                              cache_engine_version, node_type,
                                              num_nodes, cache_port,
+                                             cache_subnet_group,
                                              cache_security_groups,
                                              security_group_ids, zone, wait,
                                              hard_modify, aws_access_key,