diff --git a/.hgignore b/.hgignore
--- a/.hgignore
+++ b/.hgignore
@@ -16,6 +16,7 @@ syntax: regexp
 ^docs/build/
 ^docs/_build/
 ^data$
+^kallithea/tests/data$
 ^sql_dumps/
 ^\.settings$
 ^\.project$
diff --git a/MANIFEST.in b/MANIFEST.in
--- a/MANIFEST.in
+++ b/MANIFEST.in
@@ -17,5 +17,5 @@ recursive-include kallithea/public *
 recursive-include kallithea/templates *
 recursive-include kallithea/tests/fixtures *
 recursive-include kallithea/tests/scripts *
+include           kallithea/tests/test.ini
 include           kallithea/tests/vcs/aconfig
-include           test.ini
diff --git a/docs/contributing.rst b/docs/contributing.rst
--- a/docs/contributing.rst
+++ b/docs/contributing.rst
@@ -50,13 +50,13 @@ After finishing your changes make sure a
 the testsuite running ``nosetests`` from the project root, or if you use tox
 run ``tox`` for python2.6-2.7 with multiple database test.
 
-When using `nosetests`, the `test.ini` file is used with an SQLite database. Edit
-this file to change your testing enviroment.
+When running tests, Kallithea uses `kallithea/tests/test.ini` and populates the
+SQLite database specified there.
 
 It is possible to avoid recreating the full test database on each invocation of
 the tests, thus eliminating the initial delay. To achieve this, run the tests as::
 
-    paster serve test.ini --pid-file=test.pid --daemon
+    paster serve kallithea/tests/test.ini --pid-file=test.pid --daemon
     KALLITHEA_WHOOSH_TEST_DISABLE=1 KALLITHEA_NO_TMP_PATH=1 nosetests
     kill -9 $(cat test.pid)
 
diff --git a/kallithea/i18n/how_to b/kallithea/i18n/how_to
--- a/kallithea/i18n/how_to
+++ b/kallithea/i18n/how_to
@@ -83,7 +83,7 @@ new translation instructions
 Testing translations
 --------------------
 
-Edit test.ini file and set lang attribute to::
+Edit kallithea/tests/test.ini file and set lang attribute to::
 
     lang=<new_language_code>
 
diff --git a/kallithea/tests/conftest.py b/kallithea/tests/conftest.py
--- a/kallithea/tests/conftest.py
+++ b/kallithea/tests/conftest.py
@@ -15,7 +15,7 @@ def pytest_configure():
 
     # Disable INFO logging of test database creation, restore with NOTSET
     logging.disable(logging.INFO)
-    pylons.test.pylonsapp = loadapp('config:test.ini', relative_to=path)
+    pylons.test.pylonsapp = loadapp('config:kallithea/tests/test.ini', relative_to=path)
     logging.disable(logging.NOTSET)
 
     # Setup the config and app_globals, only works if we can get
diff --git a/kallithea/tests/other/manual_test_vcs_operations.py b/kallithea/tests/other/manual_test_vcs_operations.py
--- a/kallithea/tests/other/manual_test_vcs_operations.py
+++ b/kallithea/tests/other/manual_test_vcs_operations.py
@@ -18,7 +18,7 @@ kallithea.tests.other.manual_test_vcs_op
 Test suite for making push/pull operations.
 
 Run it in two terminals::
- paster serve test.ini
+ paster serve kallithea/tests/test.ini
  KALLITHEA_WHOOSH_TEST_DISABLE=1 KALLITHEA_NO_TMP_PATH=1 nosetests kallithea/tests/other/manual_test_vcs_operations.py
 
 You must have git > 1.8.1 for tests to work fine
diff --git a/test.ini b/kallithea/tests/test.ini
rename from test.ini
rename to kallithea/tests/test.ini
diff --git a/setup.cfg b/setup.cfg
--- a/setup.cfg
+++ b/setup.cfg
@@ -6,7 +6,7 @@ tag_date = 0
 [nosetests]
 verbose = True
 verbosity = 2
-with-pylons = test.ini
+with-pylons = kallithea/tests/test.ini
 detailed-errors = 1
 nologcapture = 1