diff --git a/tools/broccoli/broccoli-typescript.ts b/tools/broccoli/broccoli-typescript.ts
index 9370c571ba..ab4e92ee7c 100644
--- a/tools/broccoli/broccoli-typescript.ts
+++ b/tools/broccoli/broccoli-typescript.ts
@@ -1,5 +1,4 @@
 /// <reference path="../typings/node/node.d.ts" />
-/// <reference path="../../node_modules/typescript/lib/typescript.d.ts" />
 
 import fs = require('fs');
 import fse = require('fs-extra');
@@ -38,12 +37,18 @@ class DiffingTSCompiler implements DiffingBroccoliPlugin {
   static excludeExtensions = ['.d.ts'];
 
   constructor(public inputPath: string, public cachePath: string, public options) {
-    this.tsOpts = Object.create(options);
+    if (options.rootFilePaths) {
+      this.rootFilePaths = options.rootFilePaths.splice(0);
+      delete options.rootFilePaths;
+    } else {
+      this.rootFilePaths = [];
+    }
+
+    // in tsc 1.7.x this api was renamed to parseJsonConfigFileContent
+    // the conversion is a bit awkward, see https://github.com/Microsoft/TypeScript/issues/5276
+    this.tsOpts = ts.parseConfigFile({compilerOptions: options, files: []}, null, null).options;
     this.tsOpts.outDir = this.cachePath;
-    this.tsOpts.target = (<any>ts).ScriptTarget[options.target];
-    this.tsOpts.module = (<any>ts).ModuleKind[options.module];
-    this.tsOpts.experimentalDecorators = true;
-    this.rootFilePaths = options.rootFilePaths ? options.rootFilePaths.splice(0) : [];
+
     this.tsServiceHost = new CustomLanguageServiceHost(this.tsOpts, this.rootFilePaths,
                                                        this.fileRegistry, this.inputPath);
     this.tsService = ts.createLanguageService(this.tsServiceHost, ts.createDocumentRegistry());
diff --git a/tools/broccoli/trees/browser_tree.ts b/tools/broccoli/trees/browser_tree.ts
index 8a4cfc8b57..a5a1f2e5ff 100644
--- a/tools/broccoli/trees/browser_tree.ts
+++ b/tools/broccoli/trees/browser_tree.ts
@@ -112,34 +112,33 @@ module.exports = function makeBrowserTree(options, destinationPath) {
 
   // Use TypeScript to transpile the *.ts files to ES6
   var es6Tree = compileWithTypescript(modulesTree, {
-    allowNonTsExtensions: false,
     declaration: false,
     emitDecoratorMetadata: true,
+    experimentalDecorators: true,
     mapRoot: '',  // force sourcemaps to use relative path
     noEmitOnError: false,
     rootDir: '.',
     rootFilePaths: ['angular2/manual_typings/globals-es6.d.ts'],
     sourceMap: true,
     sourceRoot: '.',
-    target: 'ES6'
+    target: 'es6'
   });
 
   // Use TypeScript to transpile the *.ts files to ES5
   var typescriptOptions = {
-    allowNonTsExtensions: false,
     declaration: true,
     stripInternal: true,
     emitDecoratorMetadata: true,
     experimentalDecorators: true,
     mapRoot: '',  // force sourcemaps to use relative path
-    module: 'CommonJS',
-    moduleResolution: 1 /* classic */,
+    module: 'commonjs',
+    moduleResolution: 'classic',
     noEmitOnError: true,
     rootDir: '.',
     rootFilePaths: ['angular2/manual_typings/globals.d.ts'],
     sourceMap: true,
     sourceRoot: '.',
-    target: 'ES5'
+    target: 'es5'
   };
   var es5Tree = compileWithTypescript(es5ModulesTree, typescriptOptions);
 
diff --git a/tools/broccoli/trees/node_tree.ts b/tools/broccoli/trees/node_tree.ts
index d68f61e8ea..dab2506c1b 100644
--- a/tools/broccoli/trees/node_tree.ts
+++ b/tools/broccoli/trees/node_tree.ts
@@ -33,21 +33,20 @@ module.exports = function makeNodeTree(destinationPath) {
   });
 
   var typescriptTree = compileWithTypescript(modulesTree, {
-    allowNonTsExtensions: false,
     emitDecoratorMetadata: true,
     experimentalDecorators: true,
     declaration: true,
     stripInternal: true,
     mapRoot: '', /* force sourcemaps to use relative path */
-    module: 'CommonJS',
-    moduleResolution: 1 /* classic */,
+    module: 'commonjs',
+    moduleResolution: 'classic',
     noEmitOnError: true,
     rootDir: '.',
     rootFilePaths:
         ['angular2/manual_typings/globals.d.ts', 'angular2/typings/es6-shim/es6-shim.d.ts'],
     sourceMap: true,
     sourceRoot: '.',
-    target: 'ES5'
+    target: 'es5'
   });
 
   // Now we add the LICENSE file into all the folders that will become npm packages