diff --git a/spec/LayoutSpec.js b/spec/LayoutSpec.js
index fd471e3f..0004c618 100755
--- a/spec/LayoutSpec.js
+++ b/spec/LayoutSpec.js
@@ -460,6 +460,21 @@ describe('Layout', function() {
     });
   });
 
+  it('should layout child with margin', function() {
+    testLayout({
+      style: {},
+      children: [
+        {style: {margin: 5}}
+      ]
+    }, {
+      width: 10, height: 10, top: 0, left: 0,
+      children: [
+        {width: 0, height: 0, top: 5, left: 5}
+      ]
+    });
+  });
+
+
   it('should layout randomly', function() {
     function RNG(seed) {
       this.state = seed;
@@ -476,6 +491,14 @@ describe('Layout', function() {
         node.style[attribute] = Math.floor(rng.nextFloat() * (max - min)) + min;
       }
     }
+    function randChildren(node, chance) {
+      while (Math.random() < chance) {
+        if (!node.children) {
+          node.children = [];
+        }
+        node.children.push(generateRandomNode());
+      }
+    }
     function generateRandomNode() {
       var node = {style: {}};
       randMinMax(node, 0.1, 'width', 0, 1000);
@@ -485,6 +508,7 @@ describe('Layout', function() {
       randMinMax(node, 0.1, 'marginTop', -5, 20);
       randMinMax(node, 0.1, 'marginRight', -5, 20);
       randMinMax(node, 0.1, 'marginBottom', -5, 20);
+      randChildren(node, 0.2);
       return node;
     }
 
diff --git a/src/Layout.js b/src/Layout.js
index e8d1c6b3..bc8f32b4 100755
--- a/src/Layout.js
+++ b/src/Layout.js
@@ -154,8 +154,12 @@ function computeLayout(node) {
         betweenMainDim;
 
       if (child.layout[dim[crossAxis]] !== undefined) {
-        if (child.layout[dim[crossAxis]] > crossDim) {
-          crossDim = child.layout[dim[crossAxis]];
+        var childCrossDim = child.layout[dim[crossAxis]] +
+          getMargin(leading[crossAxis], child) +
+          getMargin(trailing[crossAxis], child);
+
+        if (childCrossDim > crossDim) {
+          crossDim = childCrossDim;
         }
       }
     });
@@ -178,7 +182,9 @@ function computeLayout(node) {
       } else if (alignItem === 'flex-end') {
         leadingCrossDim = remainingCrossDim;
       } else if (alignItem === 'stretch') {
-        child.layout[dim[crossAxis]] = node.layout[dim[crossAxis]];
+        child.layout[dim[crossAxis]] = node.layout[dim[crossAxis]] -
+          getMargin(leading[crossAxis], child) -
+          getMargin(trailing[crossAxis], child);
       }
       child.layout[pos[crossAxis]] += leadingCrossDim;
     });