diff --git a/src/demo-app/select/select-demo.html b/src/demo-app/select/select-demo.html
index 7b9c87a3ccfe..6175ceae5efb 100644
--- a/src/demo-app/select/select-demo.html
+++ b/src/demo-app/select/select-demo.html
@@ -4,8 +4,9 @@
   <md-card>
     <md-card-subtitle>ngModel</md-card-subtitle>
 
-    <md-select placeholder="Drink" [color]="drinksTheme" [(ngModel)]="currentDrink" [required]="drinksRequired" [disabled]="drinksDisabled"
-      [floatPlaceholder]="floatPlaceholder" #drinkControl="ngModel">
+    <md-select placeholder="Drink" [color]="drinksTheme" [(ngModel)]="currentDrink" [required]="drinksRequired"
+      [disabled]="drinksDisabled" [floatPlaceholder]="floatPlaceholder" #drinkControl="ngModel">
+      <md-option>None</md-option>
       <md-option *ngFor="let drink of drinks" [value]="drink.value" [disabled]="drink.disabled">
         {{ drink.viewValue }}
       </md-option>
diff --git a/src/demo-app/select/select-demo.ts b/src/demo-app/select/select-demo.ts
index 6e2ff635a202..089fd9a4eb31 100644
--- a/src/demo-app/select/select-demo.ts
+++ b/src/demo-app/select/select-demo.ts
@@ -23,6 +23,7 @@ export class SelectDemo {
   pokemonTheme = 'primary';
 
   foods = [
+    {value: null, viewValue: 'None'},
     {value: 'steak-0', viewValue: 'Steak'},
     {value: 'pizza-1', viewValue: 'Pizza'},
     {value: 'tacos-2', viewValue: 'Tacos'}
diff --git a/src/lib/select/select.md b/src/lib/select/select.md
index 3cce49f7397d..11098c03b26d 100644
--- a/src/lib/select/select.md
+++ b/src/lib/select/select.md
@@ -1,13 +1,13 @@
 `<md-select>` is a form control for selecting a value from a set of options, similar to the native
-`<select>` element. You can read more about selects in the 
+`<select>` element. You can read more about selects in the
 [Material Design spec](https://material.google.com/components/menus.html).
 
 <!-- example(select-overview) -->
 
 ### Simple select
 
-In your template, create an `md-select` element. For each option you'd like in your select, add an 
-`md-option` tag. Note that you can disable items by adding the `disabled` boolean attribute or 
+In your template, create an `md-select` element. For each option you'd like in your select, add an
+`md-option` tag. Note that you can disable items by adding the `disabled` boolean attribute or
 binding to it.
 
 *my-comp.html*
@@ -19,7 +19,7 @@ binding to it.
 
 ### Getting and setting the select value
 
-The select component is set up as a custom value accessor, so you can manipulate the select's value using 
+The select component is set up as a custom value accessor, so you can manipulate the select's value using
 any of the form directives from the core `FormsModule` or `ReactiveFormsModule`: `ngModel`, `formControl`, etc.
 
 *my-comp.html*
@@ -37,18 +37,30 @@ class MyComp {
 }
 ```
 
+### Resetting the select value
+
+If you want one of your options to reset the select's value, you can omit specifying its value:
+
+*my-comp.html*
+```html
+<md-select placeholder="State">
+   <md-option>None</md-option>
+   <md-option *ngFor="let state of states" [value]="state.code">{{ state.name }}</md-option>
+</md-select>
+```
+
 ### Setting a static placeholder
 
 It's possible to turn off the placeholder's floating animation using the `floatPlaceholder` property. It accepts one of three string options:
 - `'auto'`: This is the default floating placeholder animation. It will float up when a selection is made.
 - `'never'`: This makes the placeholder static. Rather than floating, it will disappear once a selection is made.
 - `'always'`: This makes the placeholder permanently float above the input. It will not animate up or down.
-    
+
 ```html
 <md-select placeholder="State" [(ngModel)]="myState" floatPlaceholder="never">
    <md-option *ngFor="let state of states" [value]="state.code">{{ state.name }}</md-option>
 </md-select>
-``` 
+```
 
 #### Keyboard interaction:
 - <kbd>DOWN_ARROW</kbd>: Focus next option
diff --git a/src/lib/select/select.spec.ts b/src/lib/select/select.spec.ts
index e67335d2e56a..b65c0cc0aedc 100644
--- a/src/lib/select/select.spec.ts
+++ b/src/lib/select/select.spec.ts
@@ -55,7 +55,8 @@ describe('MdSelect', () => {
         SelectEarlyAccessSibling,
         BasicSelectInitiallyHidden,
         BasicSelectNoPlaceholder,
-        BasicSelectWithTheming
+        BasicSelectWithTheming,
+        ResetValuesSelect
       ],
       providers: [
         {provide: OverlayContainer, useFactory: () => {
@@ -2022,6 +2023,82 @@ describe('MdSelect', () => {
 
   });
 
+
+  describe('reset values', () => {
+    let fixture: ComponentFixture<ResetValuesSelect>;
+    let trigger: HTMLElement;
+    let placeholder: HTMLElement;
+    let options: NodeListOf<HTMLElement>;
+
+    beforeEach(() => {
+      fixture = TestBed.createComponent(ResetValuesSelect);
+      fixture.detectChanges();
+      trigger = fixture.debugElement.query(By.css('.mat-select-trigger')).nativeElement;
+      placeholder = fixture.debugElement.query(By.css('.mat-select-placeholder')).nativeElement;
+
+      trigger.click();
+      fixture.detectChanges();
+      options = overlayContainerElement.querySelectorAll('md-option') as NodeListOf<HTMLElement>;
+
+      options[0].click();
+      fixture.detectChanges();
+    });
+
+    it('should reset when an option with an undefined value is selected', () => {
+      options[4].click();
+      fixture.detectChanges();
+
+      expect(fixture.componentInstance.control.value).toBeUndefined();
+      expect(fixture.componentInstance.select.selected).toBeFalsy();
+      expect(placeholder.classList).not.toContain('mat-floating-placeholder');
+      expect(trigger.textContent).not.toContain('Undefined');
+    });
+
+    it('should reset when an option with a null value is selected', () => {
+      options[5].click();
+      fixture.detectChanges();
+
+      expect(fixture.componentInstance.control.value).toBeNull();
+      expect(fixture.componentInstance.select.selected).toBeFalsy();
+      expect(placeholder.classList).not.toContain('mat-floating-placeholder');
+      expect(trigger.textContent).not.toContain('Null');
+    });
+
+    it('should reset when a blank option is selected', () => {
+      options[6].click();
+      fixture.detectChanges();
+
+      expect(fixture.componentInstance.control.value).toBeUndefined();
+      expect(fixture.componentInstance.select.selected).toBeFalsy();
+      expect(placeholder.classList).not.toContain('mat-floating-placeholder');
+      expect(trigger.textContent).not.toContain('None');
+    });
+
+    it('should not reset when any other falsy option is selected', () => {
+      options[3].click();
+      fixture.detectChanges();
+
+      expect(fixture.componentInstance.control.value).toBe(false);
+      expect(fixture.componentInstance.select.selected).toBeTruthy();
+      expect(placeholder.classList).toContain('mat-floating-placeholder');
+      expect(trigger.textContent).toContain('Falsy');
+    });
+
+    it('should not consider the reset values as selected when resetting the form control', () => {
+      expect(placeholder.classList).toContain('mat-floating-placeholder');
+
+      fixture.componentInstance.control.reset();
+      fixture.detectChanges();
+
+      expect(fixture.componentInstance.control.value).toBeNull();
+      expect(fixture.componentInstance.select.selected).toBeFalsy();
+      expect(placeholder.classList).not.toContain('mat-floating-placeholder');
+      expect(trigger.textContent).not.toContain('Null');
+      expect(trigger.textContent).not.toContain('Undefined');
+    });
+
+  });
+
 });
 
 
@@ -2366,3 +2443,29 @@ class BasicSelectWithTheming {
   @ViewChild(MdSelect) select: MdSelect;
   theme: string;
 }
+
+@Component({
+  selector: 'reset-values-select',
+  template: `
+    <md-select placeholder="Food" [formControl]="control">
+      <md-option *ngFor="let food of foods" [value]="food.value">
+        {{ food.viewValue }}
+      </md-option>
+
+      <md-option>None</md-option>
+    </md-select>
+  `
+})
+class ResetValuesSelect {
+  foods: any[] = [
+    { value: 'steak-0', viewValue: 'Steak' },
+    { value: 'pizza-1', viewValue: 'Pizza' },
+    { value: 'tacos-2', viewValue: 'Tacos' },
+    { value: false, viewValue: 'Falsy' },
+    { viewValue: 'Undefined' },
+    { value: null, viewValue: 'Null' },
+  ];
+  control = new FormControl();
+
+  @ViewChild(MdSelect) select: MdSelect;
+}
diff --git a/src/lib/select/select.ts b/src/lib/select/select.ts
index 273008146ea2..3bcf2240c03f 100644
--- a/src/lib/select/select.ts
+++ b/src/lib/select/select.ts
@@ -578,7 +578,7 @@ export class MdSelect implements AfterContentInit, OnDestroy, OnInit, ControlVal
    */
   private _selectValue(value: any): MdOption {
     let optionsArray = this.options.toArray();
-    let correspondingOption = optionsArray.find(option => option.value === value);
+    let correspondingOption = optionsArray.find(option => option.value && option.value === value);
 
     if (correspondingOption) {
       correspondingOption.select();
@@ -638,13 +638,19 @@ export class MdSelect implements AfterContentInit, OnDestroy, OnInit, ControlVal
   private _onSelect(option: MdOption): void {
     const wasSelected = this._selectionModel.isSelected(option);
 
+    // TODO(crisbeto): handle blank/null options inside multi-select.
     if (this.multiple) {
       this._selectionModel.toggle(option);
       wasSelected ? option.deselect() : option.select();
       this._sortValues();
     } else {
-      this._clearSelection(option);
-      this._selectionModel.select(option);
+      this._clearSelection(option.value == null ? null : option);
+
+      if (option.value == null) {
+        this._propagateChanges(option.value);
+      } else {
+        this._selectionModel.select(option);
+      }
     }
 
     if (wasSelected !== this._selectionModel.isSelected(option)) {
@@ -677,10 +683,14 @@ export class MdSelect implements AfterContentInit, OnDestroy, OnInit, ControlVal
   }
 
   /** Emits change event to set the model value. */
-  private _propagateChanges(): void {
-    let valueToEmit = Array.isArray(this.selected) ?
-      this.selected.map(option => option.value) :
-      this.selected.value;
+  private _propagateChanges(fallbackValue?: any): void {
+    let valueToEmit = null;
+
+    if (Array.isArray(this.selected)) {
+      valueToEmit = this.selected.map(option => option.value);
+    } else {
+      valueToEmit = this.selected ? this.selected.value : fallbackValue;
+    }
 
     this._onChange(valueToEmit);
     this.change.emit(new MdSelectChange(this, valueToEmit));