diff --git a/CHANGELOG.md b/CHANGELOG.md
index 7994e7c61..e495544d6 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -1,5 +1,8 @@
 * 1.0.0-alpha3
 
+  * Added caching of repository metadata (faster startup times & failover if packagist is down)
+  * Improved repository protocol to have large cacheable parts
+
 * 1.0.0-alpha2 (2012-04-03)
 
   * Added `create-project` command to install a project from scratch with composer
diff --git a/src/Composer/Cache.php b/src/Composer/Cache.php
new file mode 100644
index 000000000..1b0ad4770
--- /dev/null
+++ b/src/Composer/Cache.php
@@ -0,0 +1,70 @@
+<?php
+
+/*
+ * This file is part of Composer.
+ *
+ * (c) Nils Adermann <naderman@naderman.de>
+ *     Jordi Boggiano <j.boggiano@seld.be>
+ *
+ * For the full copyright and license information, please view the LICENSE
+ * file that was distributed with this source code.
+ */
+
+namespace Composer;
+
+use Composer\IO\IOInterface;
+
+/**
+ * Reads/writes to a filesystem cache
+ *
+ * @author Jordi Boggiano <j.boggiano@seld.be>
+ */
+class Cache
+{
+    private $io;
+    private $root;
+    private $enabled = true;
+
+    public function __construct(IOInterface $io, $cacheKey = null)
+    {
+        $this->io = $io;
+
+        if (defined('PHP_WINDOWS_VERSION_MAJOR')) {
+            $this->root = getenv('APPDATA') . rtrim('/Composer/cache/' . $cacheKey, '/') . '/';
+        } else {
+            $this->root = getenv('HOME') . rtrim('/.composer/cache/' . $cacheKey, '/') . '/';
+        }
+
+        if (!is_dir($this->root)) {
+            if (!@mkdir($this->root, 0777, true)) {
+                $this->enabled = false;
+            }
+        }
+    }
+
+    public function getRoot()
+    {
+        return $this->root;
+    }
+
+    public function read($file)
+    {
+        if ($this->enabled && file_exists($this->root . $file)) {
+            return file_get_contents($this->root . $file);
+        }
+    }
+
+    public function write($file, $contents)
+    {
+        if ($this->enabled) {
+            file_put_contents($this->root . $file, $contents);
+        }
+    }
+
+    public function sha1($file)
+    {
+        if ($this->enabled && file_exists($this->root . $file)) {
+            return sha1_file($this->root . $file);
+        }
+    }
+}
diff --git a/src/Composer/Repository/ComposerRepository.php b/src/Composer/Repository/ComposerRepository.php
index 5a0c84de9..450dfdf33 100644
--- a/src/Composer/Repository/ComposerRepository.php
+++ b/src/Composer/Repository/ComposerRepository.php
@@ -15,6 +15,7 @@ namespace Composer\Repository;
 use Composer\Package\Loader\ArrayLoader;
 use Composer\Package\LinkConstraint\VersionConstraint;
 use Composer\Json\JsonFile;
+use Composer\Cache;
 use Composer\IO\IOInterface;
 use Composer\Util\RemoteFilesystem;
 
@@ -26,6 +27,7 @@ class ComposerRepository extends ArrayRepository
     protected $url;
     protected $io;
     protected $packages;
+    protected $cache;
 
     public function __construct(array $config, IOInterface $io)
     {
@@ -40,26 +42,61 @@ class ComposerRepository extends ArrayRepository
 
         $this->url = $config['url'];
         $this->io = $io;
+        $this->cache = new Cache($io, preg_replace('{[^a-z0-9.]}', '-', $this->url));
     }
 
     protected function initialize()
     {
         parent::initialize();
-        $json     = new JsonFile($this->url.'/packages.json', new RemoteFilesystem($this->io));
-        $packages = $json->read();
-        if (!$packages) {
-            throw new \UnexpectedValueException('Could not parse package list from the '.$this->url.' repository');
-        }
 
-        if (isset($packages['includes'])) {
-            $this->io->write('<error>Your version of composer is too old, please run `php composer.phar self-update` to update it.</error>');
-            exit(1);
+        try {
+            $json = new JsonFile($this->url.'/packages.json', new RemoteFilesystem($this->io));
+            $data = $json->read();
+            $this->cache->write('packages.json', json_encode($data));
+        } catch (\Exception $e) {
+            if ($contents = $this->cache->read('packages.json')) {
+                $this->io->write('<warning>'.$this->url.' could not be loaded, package information was loaded from the local cache and may be out of date</warning>');
+                $data = json_decode($contents, true);
+            } else {
+                throw $e;
+            }
         }
 
         $loader = new ArrayLoader();
-        foreach ($packages as $data) {
-            foreach ($data['versions'] as $rev) {
-                $this->addPackage($loader->load($rev));
+        $this->loadRepository($loader, $data);
+    }
+
+    protected function loadRepository(ArrayLoader $loader, $data)
+    {
+        // legacy repo handling
+        if (!isset($data['packages']) && !isset($data['includes'])) {
+            foreach ($data as $pkg) {
+                foreach ($pkg['versions'] as $metadata) {
+                    $this->addPackage($loader->load($metadata));
+                }
+            }
+
+            return;
+        }
+
+        if (isset($data['packages'])) {
+            foreach ($data['packages'] as $package => $versions) {
+                foreach ($versions as $version => $metadata) {
+                    $this->addPackage($loader->load($metadata));
+                }
+            }
+        }
+
+        if (isset($data['includes'])) {
+            foreach ($data['includes'] as $include => $metadata) {
+                if ($this->cache->sha1($include) === $metadata['sha1']) {
+                    $includedData = json_decode($this->cache->read($include), true);
+                } else {
+                    $json = new JsonFile($this->url.'/'.$include, new RemoteFilesystem($this->io));
+                    $includedData = $json->read();
+                    $this->cache->write($include, json_encode($includedData));
+                }
+                $this->loadRepository($loader, $includedData);
             }
         }
     }