diff --git a/IPython/Magic.py b/IPython/Magic.py
index 2f1fe71..8e8e758 100644
--- a/IPython/Magic.py
+++ b/IPython/Magic.py
@@ -3381,8 +3381,13 @@ Defaulting color scheme to 'NoColor'"""
         You can also pass a variable name as an argument, e.g. '%paste foo'.
         This assigns the pasted block to variable 'foo' as string, without 
         dedenting or executing it (preceding >>> and + is still stripped)
+
+        Options
+        -------
         
-        '%paste -r' re-executes the block previously entered by cpaste.
+          -r: re-executes the block previously entered by cpaste.
+
+          -e: echo the pasted text back to the terminal.
         
         IPython statements (magics, shell escapes) are not supported (yet).
 
@@ -3390,7 +3395,7 @@ Defaulting color scheme to 'NoColor'"""
         --------
         cpaste: manually paste code into terminal until you mark its end.
         """
-        opts,args = self.parse_options(parameter_s,'r:',mode='string')
+        opts,args = self.parse_options(parameter_s,'re',mode='string')
         par = args.strip()
         if opts.has_key('r'):
             self._rerun_pasted()
@@ -3398,6 +3403,15 @@ Defaulting color scheme to 'NoColor'"""
 
         text = self.shell.hooks.clipboard_get()
         block = self._strip_pasted_lines_for_code(text.splitlines())
+
+        if opts.has_key('e'):
+            # Echo back to terminal.
+            write = self.shell.write
+            write(block)
+            if not block.endswith('\n'):
+                write('\n')
+            write("## -- End pasted text --\n")
+            
         self._execute_block(block, par)
 
     def magic_quickref(self,arg):
diff --git a/IPython/tests/test_magic.py b/IPython/tests/test_magic.py
index a17f130..32265ff 100644
--- a/IPython/tests/test_magic.py
+++ b/IPython/tests/test_magic.py
@@ -7,6 +7,7 @@ import os
 import sys
 import tempfile
 import types
+from cStringIO import StringIO
 
 import nose.tools as nt
 
@@ -261,9 +262,9 @@ class TestMagicRun(object):
 # Multiple tests for clipboard pasting
 def test_paste():
 
-    def paste(txt):
+    def paste(txt, flags=''):
         hooks.clipboard_get = lambda : txt
-        _ip.magic('paste')
+        _ip.magic('paste '+flags)
 
     # Inject fake clipboard hook but save original so we can restore it later
     hooks = _ip.IP.hooks
@@ -294,9 +295,31 @@ def test_paste():
         """)
         yield (nt.assert_equal, user_ns['x'], [1,2,3])
         yield (nt.assert_equal, user_ns['y'], [1,4,9])
-    except:
-        pass
 
-    # This should be in a finally clause, instead of the bare except above.
-    # Restore original hook
-    hooks.clipboard_get = original_clip
+        # Now, test that paste -r works
+        user_ns.pop('x', None)
+        yield (nt.assert_false, 'x' in user_ns)
+        _ip.magic('paste -r')
+        yield (nt.assert_equal, user_ns['x'], [1,2,3])
+
+        # Also test paste -e, by temporarily faking the writer
+        w = StringIO()
+        writer = _ip.IP.write
+        _ip.IP.write = w.write
+        code = """
+        a = 100
+        b = 200"""
+        try:
+            paste(code,'-e')
+            out = w.getvalue()
+        finally:
+            _ip.IP.write = writer
+        yield (nt.assert_equal, user_ns['a'], 100)
+        yield (nt.assert_equal, user_ns['b'], 200)
+        yield (nt.assert_equal, out, code+"\n## -- End pasted text --\n")
+        
+    finally:
+        # This should be in a finally clause, instead of the bare except above.
+        # Restore original hook
+        hooks.clipboard_get = original_clip
+