diff --git a/extensions/python/.vscode/launch.json b/extensions/python/.vscode/launch.json
new file mode 100644
index 00000000000..476551bebae
--- /dev/null
+++ b/extensions/python/.vscode/launch.json
@@ -0,0 +1,18 @@
+{
+	"version": "0.2.0",
+	"configurations": [
+		{
+			"name": "Launch Extension",
+			"type": "extensionHost",
+			"request": "launch",
+			"runtimeExecutable": "${execPath}",
+			"args": [
+				"--extensionDevelopmentPath=${workspaceRoot}"
+			],
+			"stopOnEntry": false,
+			"sourceMaps": true,
+			"outDir": "${workspaceRoot}/out",
+			"preLaunchTask": "npm"
+		}	
+	]
+}
\ No newline at end of file
diff --git a/extensions/python/.vscode/tasks.json b/extensions/python/.vscode/tasks.json
new file mode 100644
index 00000000000..a132a04214d
--- /dev/null
+++ b/extensions/python/.vscode/tasks.json
@@ -0,0 +1,30 @@
+// Available variables which can be used inside of strings.
+// ${workspaceRoot}: the root folder of the team
+// ${file}: the current opened file
+// ${fileBasename}: the current opened file's basename
+// ${fileDirname}: the current opened file's dirname
+// ${fileExtname}: the current opened file's extension
+// ${cwd}: the current working directory of the spawned process
+
+// A task runner that calls a custom npm script that compiles the extension.
+{
+	"version": "0.1.0",
+
+	// we want to run npm
+	"command": "npm",
+
+	// the command is a shell script
+	"isShellCommand": true,
+
+	// show the output window only if unrecognized errors occur.
+	"showOutput": "silent",
+
+	// we run the custom script "compile" as defined in package.json
+	"args": ["run", "compile"],
+
+	// The tsc compiler is started in watching mode
+	"isWatching": true,
+
+	// use the standard tsc in watch mode problem matcher to find compile problems in the output.
+	"problemMatcher": "$tsc-watch"
+}
\ No newline at end of file
diff --git a/extensions/python/.vscodeignore b/extensions/python/.vscodeignore
new file mode 100644
index 00000000000..47cf365a078
--- /dev/null
+++ b/extensions/python/.vscodeignore
@@ -0,0 +1 @@
+test/**
diff --git a/extensions/python/package.json b/extensions/python/package.json
index e93560fcb42..7896b8e9a5c 100644
--- a/extensions/python/package.json
+++ b/extensions/python/package.json
@@ -3,6 +3,8 @@
 	"version": "0.1.0",
 	"publisher": "vscode",
 	"engines": { "vscode": "*" },
+	"activationEvents": ["onLanguage:python"],
+	"main": "./out/pythonMain",
 	"contributes": {
 		"languages": [{
 			"id": "python",
@@ -19,5 +21,9 @@
 			"scopeName": "source.regexp.python",
 			"path": "./syntaxes/Regular Expressions (Python).tmLanguage"
 		}]
+	},
+	"scripts": {
+		"compile": "gulp compile-extension:python",
+		"watch": "gulp watch-extension:python"
 	}
 }
diff --git a/extensions/python/src/pythonMain.ts b/extensions/python/src/pythonMain.ts
new file mode 100644
index 00000000000..b96d2a46148
--- /dev/null
+++ b/extensions/python/src/pythonMain.ts
@@ -0,0 +1,17 @@
+/*---------------------------------------------------------------------------------------------
+ *  Copyright (c) Microsoft Corporation. All rights reserved.
+ *  Licensed under the MIT License. See License.txt in the project root for license information.
+ *--------------------------------------------------------------------------------------------*/
+'use strict';
+import { ExtensionContext, languages, IndentAction } from 'vscode';
+
+export function activate(context: ExtensionContext): any {
+	languages.setLanguageConfiguration('python', {
+		onEnterRules: [
+			{
+				beforeText: /^\s*(?:def|class|for|if|elif|else|while|try|with|finally|except|async).*?:\s*$/,
+				action: { indentAction: IndentAction.Indent }
+			}
+		]
+	});
+}
\ No newline at end of file
diff --git a/extensions/python/src/typings/ref.d.ts b/extensions/python/src/typings/ref.d.ts
new file mode 100644
index 00000000000..7f4835e6747
--- /dev/null
+++ b/extensions/python/src/typings/ref.d.ts
@@ -0,0 +1,10 @@
+/*---------------------------------------------------------------------------------------------
+ *  Copyright (c) Microsoft Corporation. All rights reserved.
+ *  Licensed under the MIT License. See License.txt in the project root for license information.
+ *--------------------------------------------------------------------------------------------*/
+
+/// <reference path='../../../../src/vs/vscode.d.ts'/>
+/// <reference path='../../../../src/typings/mocha.d.ts'/>
+/// <reference path='../../../../extensions/node.d.ts'/>
+/// <reference path='../../../../extensions/lib.core.d.ts'/>
+/// <reference path='../../../../extensions/declares.d.ts'/>
\ No newline at end of file
diff --git a/extensions/python/tsconfig.json b/extensions/python/tsconfig.json
new file mode 100644
index 00000000000..8cb16334377
--- /dev/null
+++ b/extensions/python/tsconfig.json
@@ -0,0 +1,11 @@
+{
+	"compilerOptions": {
+		"noLib": true,
+		"target": "es5",
+		"module": "commonjs",
+		"outDir": "./out"
+	},
+	"exclude": [
+		"node_modules"
+	]
+}
\ No newline at end of file