diff --git a/lib/ansible/playbook/play.py b/lib/ansible/playbook/play.py
index 3f579747f40..40274c5108a 100644
--- a/lib/ansible/playbook/play.py
+++ b/lib/ansible/playbook/play.py
@@ -89,6 +89,8 @@ class Play(object):
                 items = y.get('with_items',None)
                 if items is None:
                     items = [ '' ]
+                elif isinstance(items, basestring):
+                    items = utils.varLookup(items, task_vars)
                 for item in items:
                     mv = task_vars.copy()
                     mv['item'] = item
diff --git a/lib/ansible/utils.py b/lib/ansible/utils.py
index c507103d677..c06d3024d8a 100644
--- a/lib/ansible/utils.py
+++ b/lib/ansible/utils.py
@@ -201,7 +201,7 @@ def parse_json(data):
 
 _LISTRE = re.compile(r"(\w+)\[(\d+)\]")
 
-def varLookup(name, vars):
+def _varLookup(name, vars):
     ''' find the contents of a possibly complex variable in vars. '''
     path = name.split('.')
     space = vars
@@ -223,6 +223,12 @@ def varLookup(name, vars):
 _KEYCRE = re.compile(r"\$(?P<complex>\{){0,1}((?(complex)[\w\.\[\]]+|\w+))(?(complex)\})")
 #                        if { -> complex     if complex, allow . and need trailing }
 
+def varLookup(varname, vars):
+    m = _KEYCRE.search(varname)
+    if not m:
+        return None
+    return _varLookup(m.group(2), vars)
+
 def varReplace(raw, vars):
     '''Perform variable replacement of $vars
 
@@ -245,7 +251,7 @@ def varReplace(raw, vars):
         # original)
         varname = m.group(2)
 
-        replacement = unicode(varLookup(varname, vars) or m.group())
+        replacement = unicode(_varLookup(varname, vars) or m.group())
 
         start, end = m.span()
         done.append(raw[:start])    # Keep stuff leading up to token
diff --git a/test/TestUtils.py b/test/TestUtils.py
index 7d03e17c47e..006a687e8b6 100644
--- a/test/TestUtils.py
+++ b/test/TestUtils.py
@@ -17,7 +17,7 @@ class TestUtils(unittest.TestCase):
             }
         }
 
-        res = ansible.utils.varLookup('data.who', vars)
+        res = ansible.utils._varLookup('data.who', vars)
 
         assert sorted(res) == sorted(vars['data']['who'])