diff --git a/lib/wit/dependency.py b/lib/wit/dependency.py
index 00341ea..5e903bd 100644
--- a/lib/wit/dependency.py
+++ b/lib/wit/dependency.py
@@ -77,7 +77,7 @@ def __eq__(self, other):
     def infer_name(source):
         return Path(source).name.replace('.git', '')
 
-    # NB: mutates packages[self.name]
+    # NB: mutates packages!
     def load(self, packages, repo_paths, wsroot, download):
         if self.name in packages:
             self.package = packages[self.name]
@@ -131,12 +131,18 @@ def get_id(self):
         return "dep_"+re.sub(r"([^\w\d])", "_", self.tag())
 
     def crawl_dep_tree(self, wsroot, repo_paths, packages):
-        fancy_tag = "{}::{}".format(self.name, self.short_revision())
         self.load(packages, repo_paths, wsroot, False)
+        fancy_tag = "{}::{}".format(self.name, self.short_revision())
         if self.package.repo is None:
             return {'': "{} \033[91m(missing)\033[m".format(fancy_tag)}
-        if self.package.revision != self.resolved_rev():
-            fancy_tag += "->{}".format(self.package.short_revision())
+
+        different_name = self.package.name != self.name
+        if self.package.revision != self.resolved_rev() or different_name:
+            if different_name:
+                replacement = self.package.tag()
+            else:
+                replacement = self.package.short_revision()
+            fancy_tag += " -> {}".format(replacement)
             return {'': fancy_tag}
 
         tree = {'': fancy_tag}
diff --git a/lib/wit/main.py b/lib/wit/main.py
index 7724b44..7a47b4b 100644
--- a/lib/wit/main.py
+++ b/lib/wit/main.py
@@ -239,7 +239,7 @@ def add_dep(ws, args) -> None:
     if manifest_path.exists():
         manifest = Manifest.read_manifest(manifest_path)
     else:
-        manifest = Manifest([])
+        manifest = Manifest([], [])
 
     # make sure the dependency is not already in the cwd's manifest
     if manifest.contains_dependency(req_dep.name):
diff --git a/lib/wit/manifest.py b/lib/wit/manifest.py
index ae5ad3e..b015b00 100644
--- a/lib/wit/manifest.py
+++ b/lib/wit/manifest.py
@@ -1,6 +1,7 @@
 #!/usr/bin/env python3
 
 import json
+import collections
 from pathlib import Path
 from .witlogger import getLogger
 
@@ -15,8 +16,9 @@ class Manifest:
     Common class for the description of package dependencies and a workspace
     """
 
-    def __init__(self, dependencies):
+    def __init__(self, dependencies, replaces):
         self.dependencies = dependencies
+        self.replaces = replaces
 
     def get_dependency(self, name: str):
         for d in self.dependencies:
@@ -58,16 +60,24 @@ def write(self, path):
     @staticmethod
     def read_manifest(path, safe=False):
         if safe and not Path(path).exists():
-            return Manifest([])
+            return Manifest([], [])
         content = json.loads(path.read_text())
         return Manifest.process_manifest(content)
 
     @staticmethod
     def process_manifest(json_content):
+        replaces = []
+        if isinstance(json_content, collections.Mapping):
+            if 'replaces' in json_content:
+                replaces = json_content['replaces']
+            dep_specs = json_content['dependencies']
+        else:
+            dep_specs = json_content
+
         # import here to prevent circular dependency
         from .dependency import manifest_item_to_dep
-        dependencies = [manifest_item_to_dep(x) for x in json_content]
-        return Manifest(dependencies)
+        dependencies = [manifest_item_to_dep(x) for x in dep_specs]
+        return Manifest(dependencies, replaces)
 
 
 if __name__ == '__main__':
diff --git a/lib/wit/package.py b/lib/wit/package.py
index 941015d..59be4c3 100644
--- a/lib/wit/package.py
+++ b/lib/wit/package.py
@@ -36,6 +36,7 @@ def __init__(self, name, repo_paths):
 
         self.repo = None
         self.dependents = []
+        self.replaces = []
 
     def set_source(self, source):
         self.source = self.resolve_source(source)
diff --git a/lib/wit/workspace.py b/lib/wit/workspace.py
index 04dd78c..d92e55a 100644
--- a/lib/wit/workspace.py
+++ b/lib/wit/workspace.py
@@ -98,7 +98,7 @@ def create(cls, name, repo_paths):
             shutil.rmtree(str(dotwit))
         dotwit.mkdir()
 
-        manifest = Manifest([])
+        manifest = Manifest([], [])
         manifest.write(manifest_path)
 
         lockfile = LockFile([])
@@ -160,6 +160,32 @@ def resolve(self, download=False):
             source_map, packages, queue, errors = \
                 dep.resolve_deps(self.root, self.repo_paths, download,
                                  source_map, packages, queue, errors)
+
+        replaces_map = {}
+        for name in packages:
+            pkg = packages[name]
+            if pkg.repo:
+                replaces_map[name] = pkg.repo.read_manifest_from_commit(pkg.revision).replaces
+        for parent_name in replaces_map:
+            parent = packages[parent_name]
+            child_names = replaces_map[parent_name]
+            if len(child_names) > 0:
+                for child_name in child_names:
+                    if child_name not in packages:
+                        log.debug("Did not find replaced child {}".format(child_name))
+                        continue
+                    replaced = packages[child_name]
+                    if not parent.repo.is_ancestor(replaced.revision, parent.revision):
+                        error("I refuse to replace package '{}' with '{}' because \n"
+                              "{} is not a git ancestor of {}".format(child_name, parent_name,
+                                                                      replaced.tag(), parent.tag()))
+                    log.debug("Replacing {} with {}".format(child_name, parent_name))
+                    for dependent in replaced.dependents:
+                        dependent.package = parent
+                        parent.add_dependent(dependent)
+
+                    packages[child_name] = parent
+
         return packages, errors
 
     @passbyval
@@ -180,7 +206,15 @@ def resolve_deps(self, wsroot, repo_paths, download, source_map, packages, queue
 
     def checkout(self, packages):
         lock_packages = []
-        for name in packages:
+
+        for orig_name in packages:
+            pkg = packages[orig_name]
+            if orig_name != pkg.name and (self.root/orig_name).exists():
+                log.warn("Package '{}' has been replaced by '{}', but the folder of '{}' still "
+                         "exists".format(orig_name, pkg.name, orig_name))
+        package_names = [packages[orig_name].name for orig_name in packages]
+        package_names = list(set(package_names))
+        for name in package_names:
             package = packages[name]
             package.checkout(self.root)
             lock_packages.append(package)
diff --git a/t/manifest_replaces.t b/t/manifest_replaces.t
new file mode 100755
index 0000000..a360fd7
--- /dev/null
+++ b/t/manifest_replaces.t
@@ -0,0 +1,53 @@
+#!/bin/sh
+
+. $(dirname $0)/regress_util.sh
+
+prereq "on"
+
+# Set up repo foo
+make_repo 'foo'
+foo_commit=$(git -C foo rev-parse HEAD)
+
+cp -r foo newdir
+
+touch newdir/xyz
+cat << EOF | jq . > newdir/wit-manifest.json
+{
+    "name": "foo-newname",
+    "replaces": ["foo"],
+    "dependencies": []
+}
+EOF
+git -C newdir add -A
+git -C newdir commit -m "rename to foo-newdir"
+foo_newname_commit=$(git -C newdir rev-parse HEAD)
+
+# Now set up repo main_repo to depend on foo, foo2, foo3
+mkdir main_repo
+git -C main_repo init
+
+cat << EOF | jq . > main_repo/wit-manifest.json
+[
+    { "commit": "$foo_commit", "name": "foo", "source": "$PWD/foo" },
+    { "commit": "$foo_newname_commit", "name": "foo-newname", "source": "$PWD/newdir" }
+]
+EOF
+
+git -C main_repo add -A
+git -C main_repo commit -m "commit1"
+main_repo_commit=$(git -C main_repo rev-parse HEAD)
+
+prereq "off"
+
+# Now create a workspace from main_repo
+wit init myws -a $PWD/main_repo
+
+# Should fail because of conflicting paths for foo
+check "wit init with conflicting paths passes" [ $? -eq 0 ]
+
+
+wit --repo-path="$PWD $PWD/newdir $PWD/newdir2" init myws2 -a $PWD/main_repo
+check "wit with path set succeeds" [ $? -eq 0 ]
+
+report
+finish