diff --git a/src/Orchard.Web/Packages/Orchard.Tags/Controllers/TagsController.cs b/src/Orchard.Web/Packages/Orchard.Tags/Controllers/TagsController.cs
index b72ae0763..762e09414 100644
--- a/src/Orchard.Web/Packages/Orchard.Tags/Controllers/TagsController.cs
+++ b/src/Orchard.Web/Packages/Orchard.Tags/Controllers/TagsController.cs
@@ -1,11 +1,10 @@
 using System;
+using System.Collections.Generic;
 using System.Linq;
 using System.Web.Mvc;
 using Orchard.Localization;
 using Orchard.Logging;
-using Orchard.Models;
 using Orchard.Settings;
-using Orchard.Tags.Models;
 using Orchard.Tags.Services;
 using Orchard.Tags.ViewModels;
 using Orchard.UI.Notify;
@@ -44,9 +43,27 @@ namespace Orchard.Tags.Controllers {
             }
         }
 
-        [AcceptVerbs(HttpVerbs.Post)]
-        public ActionResult Edit(FormCollection input, string returnUrl) {
+        [HttpPost]
+        public ActionResult Edit(FormCollection input, int taggedContentId, string returnUrl, string newTagName) {
             try {
+                if (!String.IsNullOrEmpty(HttpContext.Request.Form["submit.Save"])) {
+                    if (!_authorizer.Authorize(Permissions.ApplyTag, T("Couldn't apply tag")))
+                        return new HttpUnauthorizedResult();
+                    List<int> tagsForContentItem = new List<int>();
+                    foreach (string key in input.Keys) {
+                        if (key.StartsWith("Checkbox.") && input[key] == "true") {
+                            int tagId = Convert.ToInt32(key.Substring("Checkbox.".Length));
+                            tagsForContentItem.Add(tagId);
+                        }
+                    }
+                    _tagService.UpdateTagsForContentItem(taggedContentId, tagsForContentItem);
+                }
+                else {
+                    if (!_authorizer.Authorize(Permissions.CreateTag, T("Couldn't create tag")))
+                        return new HttpUnauthorizedResult();
+                    _tagService.CreateTag(newTagName);
+                    _tagService.TagContentItem(taggedContentId, newTagName);
+                }
                 if (!String.IsNullOrEmpty(returnUrl)) {
                     return Redirect(returnUrl);
                 }
@@ -54,6 +71,9 @@ namespace Orchard.Tags.Controllers {
             }
             catch (Exception exception) {
                 _notifier.Error(T("Editing tags failed: " + exception.Message));
+                if (!String.IsNullOrEmpty(returnUrl)) {
+                    return Redirect(returnUrl);
+                }
                 return RedirectToAction("Index");
             }
         }
@@ -62,15 +82,14 @@ namespace Orchard.Tags.Controllers {
             return View(new TagsCreateViewModel());
         }
 
-        [AcceptVerbs(HttpVerbs.Post)]
+        [HttpPost]
         public ActionResult Create(FormCollection input) {
             var viewModel = new TagsCreateViewModel();
             try {
                 UpdateModel(viewModel, input.ToValueProvider());
                 if (!_authorizer.Authorize(Permissions.CreateTag, T("Couldn't create tag")))
                     return new HttpUnauthorizedResult();
-                Tag tag = new Tag { TagName = viewModel.TagName };
-                _tagService.CreateTag(tag);
+                _tagService.CreateTag(viewModel.TagName);
                 return RedirectToAction("Index");
             }
             catch (Exception exception) {
diff --git a/src/Orchard.Web/Packages/Orchard.Tags/Models/Tag.cs b/src/Orchard.Web/Packages/Orchard.Tags/Models/Tag.cs
index d80ab9cb2..a31538501 100644
--- a/src/Orchard.Web/Packages/Orchard.Tags/Models/Tag.cs
+++ b/src/Orchard.Web/Packages/Orchard.Tags/Models/Tag.cs
@@ -3,4 +3,10 @@
         public virtual int Id { get; set; }
         public virtual string TagName { get; set; }
     }
+
+    public class TagsContentItems {
+        public virtual int Id { get; set; }
+        public virtual int TagId { get; set; }
+        public virtual int ContentItemId { get; set; }
+    }
 }
diff --git a/src/Orchard.Web/Packages/Orchard.Tags/Models/TagsHandler.cs b/src/Orchard.Web/Packages/Orchard.Tags/Models/TagsHandler.cs
index 98fa455ba..09f6afff1 100644
--- a/src/Orchard.Web/Packages/Orchard.Tags/Models/TagsHandler.cs
+++ b/src/Orchard.Web/Packages/Orchard.Tags/Models/TagsHandler.cs
@@ -10,16 +10,20 @@ namespace Orchard.Tags.Models {
     public class HasTags : ContentPart {
         public HasTags() {
             AllTags = new List<Tag>();
+            CurrentTags = new List<Tag>();
         }
 
-        public IEnumerable<Tag> AllTags { get; set; }
+        public IList<Tag> AllTags { get; set; }
+        public IList<Tag> CurrentTags { get; set; }
     }
 
     public class HasTagsProvider : ContentProvider {
         private readonly IRepository<Tag> _tagsRepository;
+        private readonly IRepository<TagsContentItems> _tagsContentItemsRepository;
 
-        public HasTagsProvider(IRepository<Tag> tagsRepository) {
+        public HasTagsProvider(IRepository<Tag> tagsRepository, IRepository<TagsContentItems> tagsContentItemsRepository) {
             _tagsRepository = tagsRepository;
+            _tagsContentItemsRepository = tagsContentItemsRepository;
             Filters.Add(new ActivatingFilter<HasTags>("sandboxpage"));
         }
 
@@ -37,6 +41,11 @@ namespace Orchard.Tags.Models {
 
             HasTags tags = context.ContentItem.Get<HasTags>();
             tags.AllTags = _tagsRepository.Table.ToList();
+            IEnumerable<TagsContentItems> tagsContentItems = _tagsContentItemsRepository.Fetch(x => x.ContentItemId == context.ContentItem.Id);
+            foreach (var tagContentItem in tagsContentItems) {
+                Tag tag = _tagsRepository.Get(tagContentItem.TagId);
+                tags.CurrentTags.Add(tag);
+            }
         }
     }
 }
diff --git a/src/Orchard.Web/Packages/Orchard.Tags/Permissions.cs b/src/Orchard.Web/Packages/Orchard.Tags/Permissions.cs
index 78be5b215..412347327 100644
--- a/src/Orchard.Web/Packages/Orchard.Tags/Permissions.cs
+++ b/src/Orchard.Web/Packages/Orchard.Tags/Permissions.cs
@@ -4,6 +4,7 @@ using Orchard.Security.Permissions;
 namespace Orchard.Tags {
     public class Permissions : IPermissionProvider {
         public static readonly Permission CreateTag = new Permission { Description = "Creating a Tag", Name = "CreateTag" };
+        public static readonly Permission ApplyTag = new Permission { Description = "Applying a Tag", Name = "ApplyTag" };
 
         public string PackageName {
             get {
@@ -14,6 +15,7 @@ namespace Orchard.Tags {
         public IEnumerable<Permission> GetPermissions() {
             return new List<Permission> {
                 CreateTag,
+                ApplyTag,
             };
         }
     }
diff --git a/src/Orchard.Web/Packages/Orchard.Tags/Services/TagService.cs b/src/Orchard.Web/Packages/Orchard.Tags/Services/TagService.cs
index 48d5d8ecf..7d05039b1 100644
--- a/src/Orchard.Web/Packages/Orchard.Tags/Services/TagService.cs
+++ b/src/Orchard.Web/Packages/Orchard.Tags/Services/TagService.cs
@@ -1,6 +1,7 @@
 using System.Collections.Generic;
 using System.Linq;
 using Orchard.Data;
+using Orchard.Localization;
 using Orchard.Logging;
 using Orchard.Security;
 using Orchard.Settings;
@@ -10,32 +11,73 @@ using Orchard.UI.Notify;
 namespace Orchard.Tags.Services {
     public interface ITagService : IDependency {
         IEnumerable<Tag> GetTags();
-        void CreateTag(Tag tag);
+        Tag GetTagByName(string tagName);
+        void CreateTag(string tagName);
+        void TagContentItem(int contentItemId, string tagName);
+        void UpdateTagsForContentItem(int contentItemId, IEnumerable<int> tagsForContentItem);
     }
 
     public class TagService : ITagService {
         private readonly IRepository<Tag> _tagRepository;
+        private readonly IRepository<TagsContentItems> _tagsContentItemsRepository;
         private readonly IAuthorizer _authorizer;
         private readonly INotifier _notifier;
 
-        public TagService(IRepository<Tag> tagRepository, IAuthorizer authorizer, INotifier notifier) {
+        public TagService(IRepository<Tag> tagRepository, 
+                          IRepository<TagsContentItems> tagsContentItemsRepository,
+                          IAuthorizer authorizer, INotifier notifier) {
             _tagRepository = tagRepository;
+            _tagsContentItemsRepository = tagsContentItemsRepository;
             _authorizer = authorizer;
             _notifier = notifier;
             Logger = NullLogger.Instance;
+            T = NullLocalizer.Instance;
         }
 
         public ILogger Logger { get; set; }
         public ISite CurrentSite { get; set; }
+        public Localizer T { get; set; }
 
         #region ITagService Members
 
         public IEnumerable<Tag> GetTags() {
-            return from comment in _tagRepository.Table.ToList() select comment;
+            return from tags in _tagRepository.Table.ToList() select tags;
         }
 
-        public void CreateTag(Tag tag) {
-            _tagRepository.Create(tag);
+        public Tag GetTagByName(string tagName) {
+            return _tagRepository.Get(x => x.TagName == tagName);
+        }
+
+        public void CreateTag(string tagName) {
+            if (_tagRepository.Get(x => x.TagName == tagName) == null) {
+                Tag tag = new Tag { TagName = tagName };
+                _tagRepository.Create(tag);
+            }
+            else {
+                _notifier.Warning(T("Couldn't create tag: " + tagName + "it already exixts"));
+            }
+        }
+
+        public void TagContentItem(int contentItemId, string tagName) {
+            Tag tag = GetTagByName(tagName);
+            TagsContentItems tagsContentItems = new TagsContentItems { ContentItemId = contentItemId, TagId = tag.Id };
+            _tagsContentItemsRepository.Create(tagsContentItems);
+        }
+
+        public void UpdateTagsForContentItem(int contentItemId, IEnumerable<int> tagsForContentItem) {
+            List<int> newTagsForContentItem = new List<int>(tagsForContentItem);
+            IEnumerable<TagsContentItems> currentTagsForContentItem = _tagsContentItemsRepository.Fetch(x => x.ContentItemId == contentItemId);
+            foreach (var tagContentItem in currentTagsForContentItem) {
+                if (!newTagsForContentItem.Contains(tagContentItem.TagId)) {
+                    _tagsContentItemsRepository.Delete(tagContentItem);
+                }
+                else {
+                    newTagsForContentItem.Remove(tagContentItem.TagId);
+                }
+            }
+            foreach (var newTagForContentItem in newTagsForContentItem) {
+                _tagsContentItemsRepository.Create(new TagsContentItems { ContentItemId = contentItemId, TagId = newTagForContentItem });
+            }
         }
 
         #endregion
diff --git a/src/Orchard.Web/Packages/Orchard.Tags/Views/Models/DisplayTemplates/HasTags.ascx b/src/Orchard.Web/Packages/Orchard.Tags/Views/Models/DisplayTemplates/HasTags.ascx
index 16159fe43..ffaaa5d96 100644
--- a/src/Orchard.Web/Packages/Orchard.Tags/Views/Models/DisplayTemplates/HasTags.ascx
+++ b/src/Orchard.Web/Packages/Orchard.Tags/Views/Models/DisplayTemplates/HasTags.ascx
@@ -6,16 +6,29 @@
 <%= Html.ValidationSummary() %>
     <div class="yui-g">
         <h2 class="separator">Edit Tags</h2>
+            <%= Html.Hidden("TaggedContentId", Model.ContentItem.Id) %>
+            <%= Html.Hidden("ReturnUrl", Context.Request.Url) %>
+            <h3>Choose from existing tags</h3>
             <ol>
-                 <%= Html.Hidden("ReturnUrl", Context.Request.Url) %>
                  <% foreach (var tag in Model.AllTags) { %>
                     <li>
                         <label for"<%= tag.TagName %>"><%= tag.TagName %>:</label>
-                        <input type="checkbox" value="true" name="<%= tag.TagName %>"/>
+                    <% if (Model.CurrentTags.Contains(tag)) {%>
+                        <input type="checkbox" value="true" checked="checked" name="Checkbox.<%=tag.Id%>"/>
+                    <% } else {%>
+                        <input type="checkbox" value="true" name="Checkbox.<%=tag.Id%>"/>
+                    <% } %>
                     </li>
                   <% } %>
 			    <li>
-			        <input type="submit" class="button" value="Save" />
+			        <input type="submit" class="button" name="submit.Save" value="Save" />
+			    </li>
+			</ol>            
+			<h3>Or add a new tag</h3>
+			<ol>
+			    <li>
+			        <input id="NewTagName" class="inputText inputTextLarge" name="NewTagName" type="text" value="" />
+			        <input type="submit" class="button" name="submit.Add" value="Add" />
 			    </li>
 			</ol>
 	</div>
diff --git a/src/Orchard.Web/Packages/Orchard.Tags/Views/Tags/Index.aspx b/src/Orchard.Web/Packages/Orchard.Tags/Views/Tags/Index.aspx
index 786cbc2e8..b9c4b501d 100644
--- a/src/Orchard.Web/Packages/Orchard.Tags/Views/Tags/Index.aspx
+++ b/src/Orchard.Web/Packages/Orchard.Tags/Views/Tags/Index.aspx
@@ -10,5 +10,4 @@
                             &nbsp;
                         <% } %>
 	</div>
-	<% Html.EndForm(); %>
 <% Html.Include("Footer"); %>
\ No newline at end of file