diff --git a/blockchain/utxoviewpoint.go b/blockchain/utxoviewpoint.go
index d6cff9cf..e16ffbdd 100644
--- a/blockchain/utxoviewpoint.go
+++ b/blockchain/utxoviewpoint.go
@@ -153,6 +153,29 @@ func (entry *UtxoEntry) PkScriptByIndex(outputIndex uint32) []byte {
 	return output.pkScript
 }
 
+// Clone returns a deep copy of the utxo entry.
+func (entry *UtxoEntry) Clone() *UtxoEntry {
+	if entry == nil {
+		return nil
+	}
+
+	newEntry := &UtxoEntry{
+		version:       entry.version,
+		isCoinBase:    entry.isCoinBase,
+		blockHeight:   entry.blockHeight,
+		sparseOutputs: make(map[uint32]*utxoOutput),
+	}
+	for outputIndex, output := range entry.sparseOutputs {
+		newEntry.sparseOutputs[outputIndex] = &utxoOutput{
+			spent:      output.spent,
+			compressed: output.compressed,
+			amount:     output.amount,
+			pkScript:   output.pkScript,
+		}
+	}
+	return newEntry
+}
+
 // newUtxoEntry returns a new unspent transaction output entry with the provided
 // coinbase flag and block height ready to have unspent outputs added.
 func newUtxoEntry(version int32, isCoinBase bool, blockHeight int32) *UtxoEntry {
diff --git a/mempool/mempool_test.go b/mempool/mempool_test.go
new file mode 100644
index 00000000..8d38e826
--- /dev/null
+++ b/mempool/mempool_test.go
@@ -0,0 +1,463 @@
+// Copyright (c) 2016 The btcsuite developers
+// Use of this source code is governed by an ISC
+// license that can be found in the LICENSE file.
+
+package mempool
+
+import (
+	"encoding/hex"
+	"reflect"
+	"sync"
+	"testing"
+
+	"github.com/btcsuite/btcd/blockchain"
+	"github.com/btcsuite/btcd/btcec"
+	"github.com/btcsuite/btcd/chaincfg"
+	"github.com/btcsuite/btcd/chaincfg/chainhash"
+	"github.com/btcsuite/btcd/txscript"
+	"github.com/btcsuite/btcd/wire"
+	"github.com/btcsuite/btcutil"
+)
+
+// fakeChain is used by the pool harness to provide generated test utxos and
+// a current faked chain height to the pool callbacks.  This, in turn, allows
+// transations to be appear as though they are spending completely valid utxos.
+type fakeChain struct {
+	sync.RWMutex
+	utxos         *blockchain.UtxoViewpoint
+	currentHeight int32
+}
+
+// FetchUtxoView loads utxo details about the input transactions referenced by
+// the passed transaction from the point of view of the fake chain.
+// It also attempts to fetch the utxo details for the transaction itself so the
+// returned view can be examined for duplicate unspent transaction outputs.
+//
+// This function is safe for concurrent access however the returned view is NOT.
+func (s *fakeChain) FetchUtxoView(tx *btcutil.Tx) (*blockchain.UtxoViewpoint, error) {
+	s.RLock()
+	defer s.RUnlock()
+
+	// All entries are cloned to ensure modifications to the returned view
+	// do not affect the fake chain's view.
+
+	// Add an entry for the tx itself to the new view.
+	viewpoint := blockchain.NewUtxoViewpoint()
+	entry := s.utxos.LookupEntry(tx.Hash())
+	viewpoint.Entries()[*tx.Hash()] = entry.Clone()
+
+	// Add entries for all of the inputs to the tx to the new view.
+	for _, txIn := range tx.MsgTx().TxIn {
+		originHash := &txIn.PreviousOutPoint.Hash
+		entry := s.utxos.LookupEntry(originHash)
+		viewpoint.Entries()[*originHash] = entry.Clone()
+	}
+
+	return viewpoint, nil
+}
+
+// BestHeight returns the current height associated with the fake chain
+// instance.
+func (s *fakeChain) BestHeight() int32 {
+	s.RLock()
+	height := s.currentHeight
+	s.RUnlock()
+	return height
+}
+
+// SetHeight sets the current height associated with the fake chain instance.
+func (s *fakeChain) SetHeight(height int32) {
+	s.Lock()
+	s.currentHeight = height
+	s.Unlock()
+}
+
+// spendableOutput is a convenience type that houses a particular utxo and the
+// amount associated with it.
+type spendableOutput struct {
+	outPoint wire.OutPoint
+	amount   btcutil.Amount
+}
+
+// txOutToSpendableOut returns a spendable output given a transaction and index
+// of the output to use.  This is useful as a convenience when creating test
+// transactions.
+func txOutToSpendableOut(tx *btcutil.Tx, outputNum uint32) spendableOutput {
+	return spendableOutput{
+		outPoint: wire.OutPoint{Hash: *tx.Hash(), Index: outputNum},
+		amount:   btcutil.Amount(tx.MsgTx().TxOut[outputNum].Value),
+	}
+}
+
+// poolHarness provides a harness that includes functionality for creating and
+// signing transactions as well as a fake chain that provides utxos for use in
+// generating valid transactions.
+type poolHarness struct {
+	// signKey is the signing key used for creating transactions throughout
+	// the tests.
+	//
+	// payAddr is the p2sh address for the signing key and is used for the
+	// payment address throughout the tests.
+	signKey     *btcec.PrivateKey
+	payAddr     btcutil.Address
+	payScript   []byte
+	chainParams *chaincfg.Params
+
+	chain  *fakeChain
+	txPool *TxPool
+}
+
+// CreateCoinbaseTx returns a coinbase transaction with the requested number of
+// outputs paying an appropriate subsidy based on the passed block height to the
+// address associated with the harness.  It automatically uses a standard
+// signature script that starts with the block height that is required by
+// version 2 blocks.
+func (p *poolHarness) CreateCoinbaseTx(blockHeight int32, numOutputs uint32) (*btcutil.Tx, error) {
+	// Create standard coinbase script.
+	extraNonce := int64(0)
+	coinbaseScript, err := txscript.NewScriptBuilder().
+		AddInt64(int64(blockHeight)).AddInt64(extraNonce).Script()
+	if err != nil {
+		return nil, err
+	}
+
+	tx := wire.NewMsgTx()
+	tx.AddTxIn(&wire.TxIn{
+		// Coinbase transactions have no inputs, so previous outpoint is
+		// zero hash and max index.
+		PreviousOutPoint: *wire.NewOutPoint(&chainhash.Hash{},
+			wire.MaxPrevOutIndex),
+		SignatureScript: coinbaseScript,
+		Sequence:        wire.MaxTxInSequenceNum,
+	})
+	totalInput := blockchain.CalcBlockSubsidy(blockHeight, p.chainParams)
+	amountPerOutput := totalInput / int64(numOutputs)
+	remainder := totalInput - amountPerOutput*int64(numOutputs)
+	for i := uint32(0); i < numOutputs; i++ {
+		// Ensure the final output accounts for any remainder that might
+		// be left from splitting the input amount.
+		amount := amountPerOutput
+		if i == numOutputs-1 {
+			amount = amountPerOutput + remainder
+		}
+		tx.AddTxOut(&wire.TxOut{
+			PkScript: p.payScript,
+			Value:    amount,
+		})
+	}
+
+	return btcutil.NewTx(tx), nil
+}
+
+// CreateSignedTx creates a new signed transaction that consumes the provided
+// inputs and generates the provided number of outputs by evenly splitting the
+// total input amount.  All outputs will be to the payment script associated
+// with the harness and all inputs are assumed to do the same.
+func (p *poolHarness) CreateSignedTx(inputs []spendableOutput, numOutputs uint32) (*btcutil.Tx, error) {
+	// Calculate the total input amount and split it amongst the requested
+	// number of outputs.
+	var totalInput btcutil.Amount
+	for _, input := range inputs {
+		totalInput += input.amount
+	}
+	amountPerOutput := int64(totalInput) / int64(numOutputs)
+	remainder := int64(totalInput) - amountPerOutput*int64(numOutputs)
+
+	tx := wire.NewMsgTx()
+	for _, input := range inputs {
+		tx.AddTxIn(&wire.TxIn{
+			PreviousOutPoint: input.outPoint,
+			SignatureScript:  nil,
+			Sequence:         wire.MaxTxInSequenceNum,
+		})
+	}
+	for i := uint32(0); i < numOutputs; i++ {
+		// Ensure the final output accounts for any remainder that might
+		// be left from splitting the input amount.
+		amount := amountPerOutput
+		if i == numOutputs-1 {
+			amount = amountPerOutput + remainder
+		}
+		tx.AddTxOut(&wire.TxOut{
+			PkScript: p.payScript,
+			Value:    amount,
+		})
+	}
+
+	// Sign the new transaction.
+	for i := range tx.TxIn {
+		sigScript, err := txscript.SignatureScript(tx, i, p.payScript,
+			txscript.SigHashAll, p.signKey, true)
+		if err != nil {
+			return nil, err
+		}
+		tx.TxIn[i].SignatureScript = sigScript
+	}
+
+	return btcutil.NewTx(tx), nil
+}
+
+// CreateTxChain creates a chain of zero-fee transactions (each subsequent
+// transaction spends the entire amount from the previous one) with the first
+// one spending the provided outpoint.  Each transaction spends the entire
+// amount of the previous one and as such does not include any fees.
+func (p *poolHarness) CreateTxChain(firstOutput spendableOutput, numTxns uint32) ([]*btcutil.Tx, error) {
+	txChain := make([]*btcutil.Tx, 0, numTxns)
+	prevOutPoint := firstOutput.outPoint
+	spendableAmount := firstOutput.amount
+	for i := uint32(0); i < numTxns; i++ {
+		// Create the transaction using the previous transaction output
+		// and paying the full amount to the payment address associated
+		// with the harness.
+		tx := wire.NewMsgTx()
+		tx.AddTxIn(&wire.TxIn{
+			PreviousOutPoint: prevOutPoint,
+			SignatureScript:  nil,
+			Sequence:         wire.MaxTxInSequenceNum,
+		})
+		tx.AddTxOut(&wire.TxOut{
+			PkScript: p.payScript,
+			Value:    int64(spendableAmount),
+		})
+
+		// Sign the new transaction.
+		sigScript, err := txscript.SignatureScript(tx, 0, p.payScript,
+			txscript.SigHashAll, p.signKey, true)
+		if err != nil {
+			return nil, err
+		}
+		tx.TxIn[0].SignatureScript = sigScript
+
+		txChain = append(txChain, btcutil.NewTx(tx))
+
+		// Next transaction uses outputs from this one.
+		prevOutPoint = wire.OutPoint{Hash: tx.TxHash(), Index: 0}
+	}
+
+	return txChain, nil
+}
+
+// newPoolHarness returns a new instance of a pool harness initialized with a
+// fake chain and a TxPool bound to it that is configured with a policy suitable
+// for testing.  Also, the fake chain is populated with the returned spendable
+// outputs so the caller can easily create new valid transactions which build
+// off of it.
+func newPoolHarness(chainParams *chaincfg.Params) (*poolHarness, []spendableOutput, error) {
+	// Use a hard coded key pair for deterministic results.
+	keyBytes, err := hex.DecodeString("700868df1838811ffbdf918fb482c1f7e" +
+		"ad62db4b97bd7012c23e726485e577d")
+	if err != nil {
+		return nil, nil, err
+	}
+	signKey, signPub := btcec.PrivKeyFromBytes(btcec.S256(), keyBytes)
+
+	// Generate associated pay-to-script-hash address and resulting payment
+	// script.
+	pubKeyBytes := signPub.SerializeCompressed()
+	payPubKeyAddr, err := btcutil.NewAddressPubKey(pubKeyBytes, chainParams)
+	if err != nil {
+		return nil, nil, err
+	}
+	payAddr := payPubKeyAddr.AddressPubKeyHash()
+	pkScript, err := txscript.PayToAddrScript(payAddr)
+	if err != nil {
+		return nil, nil, err
+	}
+
+	// Create a new fake chain and harness bound to it.
+	chain := &fakeChain{utxos: blockchain.NewUtxoViewpoint()}
+	harness := poolHarness{
+		signKey:     signKey,
+		payAddr:     payAddr,
+		payScript:   pkScript,
+		chainParams: chainParams,
+
+		chain: chain,
+		txPool: New(&Config{
+			Policy: Policy{
+				DisableRelayPriority: true,
+				FreeTxRelayLimit:     15.0,
+				MaxOrphanTxs:         5,
+				MaxOrphanTxSize:      1000,
+				MaxSigOpsPerTx:       blockchain.MaxSigOpsPerBlock / 5,
+				MinRelayTxFee:        1000, // 1 Satoshi per byte
+			},
+			ChainParams:   chainParams,
+			FetchUtxoView: chain.FetchUtxoView,
+			BestHeight:    chain.BestHeight,
+			SigCache:      nil,
+			TimeSource:    blockchain.NewMedianTime(),
+			AddrIndex:     nil,
+		}),
+	}
+
+	// Create a single coinbase transaction and add it to the harness
+	// chain's utxo set and set the harness chain height such that the
+	// coinbase will mature in the next block.  This ensures the txpool
+	// accepts transactions which spend immature coinbases that will become
+	// mature in the next block.
+	numOutputs := uint32(1)
+	outputs := make([]spendableOutput, 0, numOutputs)
+	curHeight := harness.chain.BestHeight()
+	coinbase, err := harness.CreateCoinbaseTx(curHeight+1, numOutputs)
+	if err != nil {
+		return nil, nil, err
+	}
+	harness.chain.utxos.AddTxOuts(coinbase, curHeight+1)
+	for i := uint32(0); i < numOutputs; i++ {
+		outputs = append(outputs, txOutToSpendableOut(coinbase, i))
+	}
+	harness.chain.SetHeight(int32(chainParams.CoinbaseMaturity) + curHeight)
+
+	return &harness, outputs, nil
+}
+
+// TestSimpleOrphanChain ensures that a simple chain of orphans is handled
+// properly.  In particular, it generates a chain of single input, single output
+// transactions and inserts them while skipping the first linking transaction so
+// they are all orphans.  Finally, it adds the linking transaction and ensures
+// the entire orphan chain is moved to the transaction pool.
+func TestSimpleOrphanChain(t *testing.T) {
+	t.Parallel()
+
+	harness, spendableOuts, err := newPoolHarness(&chaincfg.MainNetParams)
+	if err != nil {
+		t.Fatalf("unable to create test pool: %v", err)
+	}
+
+	// Create a chain of transactions rooted with the first spendable output
+	// provided by the harness.
+	maxOrphans := uint32(harness.txPool.cfg.Policy.MaxOrphanTxs)
+	chainedTxns, err := harness.CreateTxChain(spendableOuts[0], maxOrphans+1)
+	if err != nil {
+		t.Fatalf("unable to create transaction chain: %v", err)
+	}
+
+	// Ensure the orphans are accepted (only up to the maximum allowed so
+	// none are evicted).
+	for _, tx := range chainedTxns[1 : maxOrphans+1] {
+		acceptedTxns, err := harness.txPool.ProcessTransaction(tx, true,
+			false)
+		if err != nil {
+			t.Fatalf("ProcessTransaction: failed to accept valid "+
+				"orphan %v", err)
+		}
+
+		// Ensure no transactions were reported as accepted.
+		if len(acceptedTxns) != 0 {
+			t.Fatalf("ProcessTransaction: reported %d accepted "+
+				"transactions from what should be an orphan",
+				len(acceptedTxns))
+		}
+
+		// Ensure the transaction is in the orphan pool.
+		if !harness.txPool.IsOrphanInPool(tx.Hash()) {
+			t.Fatal("IsOrphanInPool: false for accepted orphan")
+		}
+
+		// Ensure the transaction is not in the transaction pool.
+		if harness.txPool.IsTransactionInPool(tx.Hash()) {
+			t.Fatal("IsTransactionInPool: true for accepted orphan")
+		}
+
+		// Ensure the transaction is reported as available.
+		if !harness.txPool.HaveTransaction(tx.Hash()) {
+			t.Fatal("HaveTransaction: false for accepted orphan")
+		}
+	}
+
+	// Add the transaction which completes the orphan chain and ensure they
+	// all get accepted.  Notice the accept orphans flag is also false here
+	// to ensure it has no bearing on whether or not already existing
+	// orphans in the pool are linked.
+	acceptedTxns, err := harness.txPool.ProcessTransaction(chainedTxns[0],
+		false, false)
+	if err != nil {
+		t.Fatalf("ProcessTransaction: failed to accept valid "+
+			"orphan %v", err)
+	}
+	if len(acceptedTxns) != len(chainedTxns) {
+		t.Fatalf("ProcessTransaction: reported accepted transactions "+
+			"length does not match expected -- got %d, want %d",
+			len(acceptedTxns), len(chainedTxns))
+	}
+	for _, tx := range acceptedTxns {
+		// Ensure none of the transactions are still in the orphan pool.
+		if harness.txPool.IsOrphanInPool(tx.Hash()) {
+			t.Fatalf("IsOrphanInPool: true for accepted tx %v",
+				tx.Hash())
+		}
+
+		// Ensure all of the transactions are now in the transaction
+		// pool.
+		if !harness.txPool.IsTransactionInPool(tx.Hash()) {
+			t.Fatalf("IsTransactionInPool: false for accepted tx %v",
+				tx.Hash())
+		}
+	}
+}
+
+// TestOrphanReject ensures that orphans are properly rejected when the allow
+// orphans flag is not set on ProcessTransaction.
+func TestOrphanReject(t *testing.T) {
+	t.Parallel()
+
+	harness, outputs, err := newPoolHarness(&chaincfg.MainNetParams)
+	if err != nil {
+		t.Fatalf("unable to create test pool: %v", err)
+	}
+
+	// Create a chain of transactions rooted with the first spendable output
+	// provided by the harness.
+	maxOrphans := uint32(harness.txPool.cfg.Policy.MaxOrphanTxs)
+	chainedTxns, err := harness.CreateTxChain(outputs[0], maxOrphans+1)
+	if err != nil {
+		t.Fatalf("unable to create transaction chain: %v", err)
+	}
+
+	// Ensure orphans are rejected when the allow orphans flag is not set.
+	for _, tx := range chainedTxns[1:] {
+		acceptedTxns, err := harness.txPool.ProcessTransaction(tx, false,
+			false)
+		if err == nil {
+			t.Fatalf("ProcessTransaction: did not fail on orphan "+
+				"%v when allow orphans flag is false", tx.Hash())
+		}
+		expectedErr := RuleError{}
+		if reflect.TypeOf(err) != reflect.TypeOf(expectedErr) {
+			t.Fatalf("ProcessTransaction: wrong error got: <%T> %v, "+
+				"want: <%T>", err, err, expectedErr)
+		}
+		code, extracted := extractRejectCode(err)
+		if !extracted {
+			t.Fatalf("ProcessTransaction: failed to extract reject "+
+				"code from error %q", err)
+		}
+		if code != wire.RejectDuplicate {
+			t.Fatalf("ProcessTransaction: unexpected reject code "+
+				"-- got %v, want %v", code, wire.RejectDuplicate)
+		}
+
+		// Ensure no transactions were reported as accepted.
+		if len(acceptedTxns) != 0 {
+			t.Fatal("ProcessTransaction: reported %d accepted "+
+				"transactions from failed orphan attempt",
+				len(acceptedTxns))
+		}
+
+		// Ensure the transaction is not in the orphan pool.
+		if harness.txPool.IsOrphanInPool(tx.Hash()) {
+			t.Fatal("IsOrphanInPool: true for rejected orphan")
+		}
+
+		// Ensure the transaction is not in the transaction pool.
+		if harness.txPool.IsTransactionInPool(tx.Hash()) {
+			t.Fatal("IsTransactionInPool: true for rejected orphan")
+		}
+
+		// Ensure the transaction is not reported as available.
+		if harness.txPool.HaveTransaction(tx.Hash()) {
+			t.Fatal("HaveTransaction: true for rejected orphan")
+		}
+	}
+}