diff --git a/README.markdown b/README.markdown
deleted file mode 100644
index 9e73704..0000000
--- a/README.markdown
+++ /dev/null
@@ -1,72 +0,0 @@
-Version 0.8rc1
-
-# A brand new **hyde**
-
-This is the new version of hyde under active development. Hyde documentation
-is a work in progress and can be found [here](http://hyde.github.com).
-
-## Installation
-
-To get the latest released version:
-
-    pip install hyde
-
-For the current trunk:
-
-    pip install -e git://github.com/hyde/hyde.git#egg=hyde
-
-## Creating a new hyde site
-
-The following command:
-
-        hyde -s ~/test_site create
-
-will create a new hyde site using the test layout.
-
-## Generating the hyde site
-
-        cd ~/test_site
-        hyde gen
-
-## Serving the website
-
-        cd ~/test_site
-        hyde serve
-        open http://localhost:8080
-
-
-The server also regenerates on demand. As long as the server is running,
-you can make changes to your source and refresh the browser to view the changes.
-
-
-## Examples
-
-1. [Hyde Documentation](https://github.com/hyde/docs)
-2. [Cloudpanic](https://github.com/tipiirai/cloudpanic)
-3. [Ringce](https://github.com/lakshmivyas/ringce/tree/v3.0)
-
-## A brief list of features
-
-
-1. Support for multiple templates (although only `Jinja2` is currently implemented)
-2. The different processor modules in the previous version are now
-   replaced by a plugin object. This allows plugins to listen to events that
-   occur during different times in the lifecycle and respond accordingly.
-3. Metadata: Hyde now supports hierarchical metadata. You can specify and override
-   variables at the site, node or the page level and access them in the templates.
-4. Sorting: The sorter plugin provides rich sorting options that extend the
-   object model.
-5. Syntactic Sugar: Because of the richness of the plugin infrastructure, hyde can
-   now provide additional syntactic sugar to make the content more readable. See
-   `blockdown` and `autoextend` plugin for examples.
-
-## Next Steps
-
-1. Documentation
-2. <del>Default Layouts</del>
-3. Django Support
-4. Plugins:
-    * <del>Tags</del>
-    * Atom / RSS
-    * <del>Text Compressor (CSS, JS, HTML)</del>
-    * <del>Image optimizer</del>
\ No newline at end of file
diff --git a/README.rst b/README.rst
new file mode 100644
index 0000000..b08963e
--- /dev/null
+++ b/README.rst
@@ -0,0 +1,99 @@
+Version 0.8rc1
+
+A brand new **hyde**
+====================
+
+This is the new version of `hyde`_ under active development. Hyde
+documentation is a work in progress and can be found `here`_.
+
+Installation
+------------
+
+To get the latest released version:
+
+::
+
+    pip install hyde
+
+For the current trunk:
+
+::
+
+    pip install -e git://github.com/hyde/hyde.git#egg=hyde
+
+Creating a new hyde site
+------------------------
+
+The following command:
+
+::
+
+        hyde -s ~/test_site create
+
+will create a new hyde site using the test layout.
+
+Generating the hyde site
+------------------------
+
+::
+
+        cd ~/test_site
+        hyde gen
+
+Serving the website
+-------------------
+
+::
+
+        cd ~/test_site
+        hyde serve
+        open http://localhost:8080
+
+The server also regenerates on demand. As long as the server is running,
+you can make changes to your source and refresh the browser to view the
+changes.
+
+Examples
+--------
+
+1. `Hyde Documentation`_
+2. `Cloudpanic`_
+3. `Ringce`_
+
+A brief list of features
+------------------------
+
+1. Support for multiple templates (although only ``Jinja2`` is currently
+   implemented)
+2. The different processor modules in the previous version are now
+   replaced by a plugin object. This allows plugins to listen to events
+   that occur during different times in the lifecycle and respond
+   accordingly.
+3. Metadata: Hyde now supports hierarchical metadata. You can specify
+   and override variables at the site, node or the page level and access
+   them in the templates.
+4. Sorting: The sorter plugin provides rich sorting options that extend
+   the object model.
+5. Syntactic Sugar: Because of the richness of the plugin
+   infrastructure, hyde can now provide additional syntactic sugar to
+   make the content more readable. See ``blockdown`` and ``autoextend``
+   plugin for examples.
+
+Next Steps
+----------
+
+1. Documentation ✓
+2. Default Layouts ✓
+3. Django Support ✓
+4. Plugins: 
+
+   -  Tags ✓
+   -  Atom / RSS
+   -  Text Compressor (CSS, JS, HTML) ✓
+   -  Image optimizer ✓
+
+.. _hyde: https://github.com/lakshmivyas/hyde
+.. _here: http://hyde.github.com
+.. _Hyde Documentation: https://github.com/hyde/docs
+.. _Cloudpanic: https://github.com/tipiirai/cloudpanic
+.. _Ringce: https://github.com/lakshmivyas/ringce/tree/v3.0
\ No newline at end of file
diff --git a/setup.py b/setup.py
index 2aff5ff..69cc2b8 100644
--- a/setup.py
+++ b/setup.py
@@ -13,7 +13,7 @@ import sys
 
 PROJECT = 'hyde'
 try:
-    long_description = open('README.markdown', 'rt').read()
+    long_description = open('README.rst', 'rt').read()
 except IOError:
     long_description = ''