diff --git a/README.md b/README.md
index ef4b9014c3c8..ec65bdf2c5e6 100644
--- a/README.md
+++ b/README.md
@@ -141,6 +141,20 @@ You can also add your own env files other than `dev` and `prod` by creating a
 `src/app/environments/environment.{NAME}.ts` and use them by using the `--env=NAME`
 flag on the build/serve commands.
 
+### Base tag handling in index.html
+
+You can modify base tag (`<base href="/">`) in your index.html by using `--base-href your-url` option. It's useful when building or serving for different environments.
+
+```bash
+# Sets base tag href to /myUrl/ in your index.html
+ng build --base-href /myUrl/
+ng serve --base-href /myUrl/
+
+# Does nothing
+ng build --base-href
+ng serve --base-href
+```
+
 ### Bundling
 
 Builds created with the `-prod` flag via `ng build -prod` or `ng serve -prod` bundle
diff --git a/addon/ng2/commands/build.ts b/addon/ng2/commands/build.ts
index 935102fa8484..a3749004dd3c 100644
--- a/addon/ng2/commands/build.ts
+++ b/addon/ng2/commands/build.ts
@@ -9,6 +9,7 @@ interface BuildOptions {
   watch?: boolean;
   watcher?: string;
   supressSizes: boolean;
+  baseHref?: string;
 }
 
 module.exports = Command.extend({
@@ -22,7 +23,8 @@ module.exports = Command.extend({
     { name: 'output-path',    type: 'Path',  default: 'dist/',       aliases: ['o'] },
     { name: 'watch',          type: Boolean, default: false,         aliases: ['w'] },
     { name: 'watcher',        type: String },
-    { name: 'suppress-sizes', type: Boolean, default: false }
+    { name: 'suppress-sizes', type: Boolean, default: false },
+    { name: 'base-href',      type: String,  default: null },
   ],
 
   run: function (commandOptions: BuildOptions) {
@@ -43,7 +45,8 @@ module.exports = Command.extend({
         ui: ui,
         outputPath: commandOptions.outputPath,
         target: commandOptions.target,
-        environment: commandOptions.environment
+        environment: commandOptions.environment,
+        baseHref: commandOptions.baseHref
       }) :
       new WebpackBuild({
         cliProject: project,
@@ -51,6 +54,7 @@ module.exports = Command.extend({
         outputPath: commandOptions.outputPath,
         target: commandOptions.target,
         environment: commandOptions.environment,
+        baseHref: commandOptions.baseHref
       });
 
     return buildTask.run(commandOptions);
diff --git a/addon/ng2/commands/serve.ts b/addon/ng2/commands/serve.ts
index 7e048aff2a39..7ea94b23e3f9 100644
--- a/addon/ng2/commands/serve.ts
+++ b/addon/ng2/commands/serve.ts
@@ -28,6 +28,7 @@ export interface ServeTaskOptions {
   ssl?: boolean;
   sslKey?: string;
   sslCert?: string;
+  baseHref?: string;
 }
 
 module.exports = Command.extend({
@@ -51,7 +52,8 @@ module.exports = Command.extend({
     { name: 'output-path',          type: 'Path',  default: 'dist/',       aliases: ['op', 'out'] },
     { name: 'ssl',                  type: Boolean, default: false },
     { name: 'ssl-key',              type: String,  default: 'ssl/server.key' },
-    { name: 'ssl-cert',             type: String,  default: 'ssl/server.crt' }
+    { name: 'ssl-cert',             type: String,  default: 'ssl/server.crt' },
+    { name: 'base-href',            type: String,  default: null },
   ],
 
   run: function(commandOptions: ServeTaskOptions) {
@@ -85,6 +87,7 @@ module.exports = Command.extend({
           ui: this.ui,
           analytics: this.analytics,
           project: this.project,
+          baseHref: commandOptions.baseHref
         });
 
         return serve.run(commandOptions);
diff --git a/addon/ng2/models/webpack-build-common.ts b/addon/ng2/models/webpack-build-common.ts
index edb412f710b1..66e3640d204f 100644
--- a/addon/ng2/models/webpack-build-common.ts
+++ b/addon/ng2/models/webpack-build-common.ts
@@ -4,8 +4,9 @@ import * as HtmlWebpackPlugin from 'html-webpack-plugin';
 import * as webpack from 'webpack';
 import { ForkCheckerPlugin } from 'awesome-typescript-loader';
 import { CliConfig } from './config';
+import { BaseHrefWebpackPlugin } from '../utilities/base-href-webpack-plugin';
 
-export function getWebpackCommonConfig(projectRoot: string, sourceDir: string) {
+export function getWebpackCommonConfig(projectRoot: string, sourceDir: string, baseHref: string) {
   return {
     devtool: 'inline-source-map',
     resolve: {
@@ -64,6 +65,9 @@ export function getWebpackCommonConfig(projectRoot: string, sourceDir: string) {
         template: path.resolve(projectRoot, `./${sourceDir}/index.html`),
         chunksSortMode: 'dependency'
       }),
+      new BaseHrefWebpackPlugin({
+        baseHref: baseHref
+      }),
       new webpack.optimize.CommonsChunkPlugin({
         name: ['polyfills']
       }),
diff --git a/addon/ng2/models/webpack-config.ts b/addon/ng2/models/webpack-config.ts
index a215217c0afa..8aa148b8dd83 100644
--- a/addon/ng2/models/webpack-config.ts
+++ b/addon/ng2/models/webpack-config.ts
@@ -23,12 +23,12 @@ export class NgCliWebpackConfig {
   private webpackMobileConfigPartial: any;
   private webpackMobileProdConfigPartial: any;
 
-  constructor(public ngCliProject: any, public target: string, public environment: string) {
+  constructor(public ngCliProject: any, public target: string, public environment: string, public baseHref: string) {
     const sourceDir = CliConfig.fromProject().defaults.sourceDir;
 
     const environmentPath = `./${sourceDir}/app/environments/environment.${environment}.ts`;
 
-    this.webpackBaseConfig = getWebpackCommonConfig(this.ngCliProject.root, sourceDir);
+    this.webpackBaseConfig = getWebpackCommonConfig(this.ngCliProject.root, sourceDir, baseHref);
     this.webpackDevConfigPartial = getWebpackDevConfigPartial(this.ngCliProject.root, sourceDir);
     this.webpackProdConfigPartial = getWebpackProdConfigPartial(this.ngCliProject.root, sourceDir);
 
diff --git a/addon/ng2/tasks/build-webpack-watch.ts b/addon/ng2/tasks/build-webpack-watch.ts
index 7e6514c6513f..e0144395d80b 100644
--- a/addon/ng2/tasks/build-webpack-watch.ts
+++ b/addon/ng2/tasks/build-webpack-watch.ts
@@ -16,7 +16,7 @@ module.exports = Task.extend({
 
     rimraf.sync(path.resolve(project.root, runTaskOptions.outputPath));
 
-    const config = new NgCliWebpackConfig(project, runTaskOptions.target, runTaskOptions.environment).config;
+    const config = new NgCliWebpackConfig(project, runTaskOptions.target, runTaskOptions.environment, runTaskOptions.baseHref).config;
     const webpackCompiler = webpack(config);
 
     webpackCompiler.apply(new ProgressPlugin({
diff --git a/addon/ng2/tasks/build-webpack.ts b/addon/ng2/tasks/build-webpack.ts
index 8d98d76a6812..aef91f480d31 100644
--- a/addon/ng2/tasks/build-webpack.ts
+++ b/addon/ng2/tasks/build-webpack.ts
@@ -11,12 +11,12 @@ let lastHash: any = null;
 
 module.exports = Task.extend({
   // Options: String outputPath
-  run: function(runTaskOptions: ServeTaskOptions) {
+  run: function (runTaskOptions: ServeTaskOptions) {
 
     var project = this.cliProject;
 
     rimraf.sync(path.resolve(project.root, runTaskOptions.outputPath));
-    var config = new NgCliWebpackConfig(project, runTaskOptions.target, runTaskOptions.environment).config;
+    var config = new NgCliWebpackConfig(project, runTaskOptions.target, runTaskOptions.environment, runTaskOptions.baseHref).config;
     const webpackCompiler = webpack(config);
 
     const ProgressPlugin  = require('webpack/lib/ProgressPlugin');
diff --git a/addon/ng2/tasks/serve-webpack.ts b/addon/ng2/tasks/serve-webpack.ts
index 60589e48c011..a798e4773fc6 100644
--- a/addon/ng2/tasks/serve-webpack.ts
+++ b/addon/ng2/tasks/serve-webpack.ts
@@ -15,7 +15,7 @@ module.exports = Task.extend({
     let lastHash = null;
     let webpackCompiler: any;
 
-    var config: NgCliWebpackConfig = new NgCliWebpackConfig(this.project, commandOptions.target, commandOptions.environment).config;
+    var config: NgCliWebpackConfig = new NgCliWebpackConfig(this.project, commandOptions.target, commandOptions.environment, commandOptions.baseHref).config;
     // This allows for live reload of page when changes are made to repo.
     // https://webpack.github.io/docs/webpack-dev-server.html#inline-mode
     config.entry.main.unshift(`webpack-dev-server/client?http://${commandOptions.host}:${commandOptions.port}/`);
diff --git a/addon/ng2/utilities/base-href-webpack-plugin.ts b/addon/ng2/utilities/base-href-webpack-plugin.ts
new file mode 100644
index 000000000000..a5f5ae1556cb
--- /dev/null
+++ b/addon/ng2/utilities/base-href-webpack-plugin.ts
@@ -0,0 +1,32 @@
+interface BaseHrefWebpackPluginOptions {
+  baseHref: string;
+}
+
+export class BaseHrefWebpackPlugin {
+  constructor(private options: BaseHrefWebpackPluginOptions) { }
+
+  apply(compiler): void {
+    // Ignore if baseHref is not passed
+    if (!this.options.baseHref) {
+      return;
+    }
+
+    compiler.plugin('compilation', (compilation) => {
+      compilation.plugin('html-webpack-plugin-before-html-processing', (htmlPluginData, callback) => {
+        // Check if base tag already exists
+        const baseTagRegex = /<base.*?>/i;
+        const baseTagMatches = htmlPluginData.html.match(baseTagRegex);
+        if (!baseTagMatches) {
+          // Insert it in top of the head if not exist
+          htmlPluginData.html = htmlPluginData.html.replace(/<head>/i, '$&' + `<base href="${this.options.baseHref}">`);
+        } else {
+          // Replace only href attribute if exists
+          const modifiedBaseTag = baseTagMatches[0].replace(/href="\S+"/i, `href="${this.options.baseHref}"`);
+          htmlPluginData.html = htmlPluginData.html.replace(baseTagRegex, modifiedBaseTag);
+        }
+
+        callback(null, htmlPluginData);
+      });
+    });
+  }
+}
\ No newline at end of file
diff --git a/tests/acceptance/base-href.spec.js b/tests/acceptance/base-href.spec.js
new file mode 100644
index 000000000000..5cb6eca6de9d
--- /dev/null
+++ b/tests/acceptance/base-href.spec.js
@@ -0,0 +1,50 @@
+/*eslint-disable no-console */
+'use strict';
+
+var expect = require('chai').expect;
+var BaseHrefWebpackPlugin = require('../../addon/ng2/utilities/base-href-webpack-plugin').BaseHrefWebpackPlugin;
+
+function mockCompiler(indexHtml, callback) {
+  return {
+    plugin: function (event, compilerCallback) {
+      var compilation = {
+        plugin: function (hook, compilationCallback) {
+          var htmlPluginData = {
+            html: indexHtml
+          };
+          compilationCallback(htmlPluginData, callback);
+        }
+      };
+      compilerCallback(compilation);
+    }
+  };
+}
+
+describe.only('base href webpack plugin', function () {
+  it('should do nothing when baseHref is null', function () {
+    var plugin = new BaseHrefWebpackPlugin({ baseHref: null });
+
+    var compiler = mockCompiler('<body><head></head></body>', function (x, htmlPluginData) {
+      expect(htmlPluginData.html).to.equal('<body><head></head></body>');
+    });
+    plugin.apply(compiler);
+  });
+
+  it('should insert base tag when not exist', function () {
+    var plugin = new BaseHrefWebpackPlugin({ baseHref: '/' });
+
+    var compiler = mockCompiler('<body><head></head></body>', function (x, htmlPluginData) {
+      expect(htmlPluginData.html).to.equal('<body><head><base href="/"></head></body>');
+    });
+    plugin.apply(compiler);
+  });
+
+  it('should replace href attribute when base tag already exists', function () {
+    var plugin = new BaseHrefWebpackPlugin({ baseHref: '/myUrl/' });
+
+    var compiler = mockCompiler('<body><head><base href="/" target="_blank"></head></body>', function (x, htmlPluginData) {
+      expect(htmlPluginData.html).to.equal('<body><head><base href="/myUrl/" target="_blank"></head></body>');
+    });
+    plugin.apply(compiler);
+  });
+});
diff --git a/tests/e2e/e2e_workflow.spec.js b/tests/e2e/e2e_workflow.spec.js
index 052efd377a21..ad836cabf1ac 100644
--- a/tests/e2e/e2e_workflow.spec.js
+++ b/tests/e2e/e2e_workflow.spec.js
@@ -125,6 +125,20 @@ describe('Basic end-to-end Workflow', function () {
     });
   });
 
+  it('Supports base tag modifications via `ng build --base-href`', function() {
+    this.timeout(420000);
+
+    // Check base tag before building with --base-href tag
+    const indexHtmlBefore = fs.readFileSync(path.join(process.cwd(), 'dist/index.html'), 'utf-8');
+    expect(indexHtmlBefore).to.match(/<base href="\/"/);
+
+    sh.exec(`${ngBin} build --base-href /myUrl/`);
+
+    // Check for base tag after build
+    const indexHtmlAfter = fs.readFileSync(path.join(process.cwd(), 'dist/index.html'), 'utf-8');
+    expect(indexHtmlAfter).to.match(/<base href="\/myUrl\/"/);
+  });
+
   it('Can run `ng build` in created project', function () {
     this.timeout(420000);
 
@@ -339,7 +353,7 @@ describe('Basic end-to-end Workflow', function () {
     let lessExample = '.outer {\n  .inner { background: #fff; }\n }';
     let componentContents = fs.readFileSync(componentFile, 'utf8');
     
-    sh.mv(cssFile, lessFile);      
+    sh.mv(cssFile, lessFile);    
     fs.writeFileSync(lessFile, lessExample, 'utf8');
     fs.writeFileSync(componentFile, componentContents.replace(new RegExp(cssFilename, 'g'), lessFilename), 'utf8');
 
@@ -366,7 +380,7 @@ describe('Basic end-to-end Workflow', function () {
     let stylusExample = '.outer {\n  .inner { background: #fff; }\n }';
     let componentContents = fs.readFileSync(componentFile, 'utf8');
     
-    sh.mv(cssFile, stylusFile);      
+    sh.mv(cssFile, stylusFile);    
     fs.writeFileSync(stylusFile, stylusExample, 'utf8');
     fs.writeFileSync(componentFile, componentContents.replace(new RegExp(cssFilename, 'g'), stylusFilename), 'utf8');