diff --git a/modules/angular2/src/core/compiler/template_parser.ts b/modules/angular2/src/core/compiler/template_parser.ts
index 452e45a3ef..4817ac6202 100644
--- a/modules/angular2/src/core/compiler/template_parser.ts
+++ b/modules/angular2/src/core/compiler/template_parser.ts
@@ -220,7 +220,8 @@ class TemplateParseVisitor implements HtmlAstVisitor {
       parsedElement =
           new NgContentAst(this.ngContentCount++, elementNgContentIndex, element.sourceInfo);
     } else if (isTemplateElement) {
-      this._assertNoComponentsNorElementBindingsOnTemplate(directives, elementProps, events,
+      this._assertAllEventsPublishedByDirectives(directives, events, element.sourceInfo);
+      this._assertNoComponentsNorElementBindingsOnTemplate(directives, elementProps,
                                                            element.sourceInfo);
       parsedElement = new EmbeddedTemplateAst(attrs, vars, directives, children,
                                               elementNgContentIndex, element.sourceInfo);
@@ -239,7 +240,7 @@ class TemplateParseVisitor implements HtmlAstVisitor {
       var templateElementProps: BoundElementPropertyAst[] = this._createElementPropertyAsts(
           element.name, templateElementOrDirectiveProps, templateDirectives);
       this._assertNoComponentsNorElementBindingsOnTemplate(templateDirectives, templateElementProps,
-                                                           [], element.sourceInfo);
+                                                           element.sourceInfo);
       parsedElement = new EmbeddedTemplateAst([], templateVars, templateDirectives, [parsedElement],
                                               component.findNgContentIndex(templateCssSelector),
                                               element.sourceInfo);
@@ -567,7 +568,6 @@ class TemplateParseVisitor implements HtmlAstVisitor {
 
   private _assertNoComponentsNorElementBindingsOnTemplate(directives: DirectiveAst[],
                                                           elementProps: BoundElementPropertyAst[],
-                                                          events: BoundEventAst[],
                                                           sourceInfo: string) {
     var componentTypeNames: string[] = this._findComponentDirectiveNames(directives);
     if (componentTypeNames.length > 0) {
@@ -578,9 +578,20 @@ class TemplateParseVisitor implements HtmlAstVisitor {
       this._reportError(
           `Property binding ${prop.name} not used by any directive on an embedded template in ${prop.sourceInfo}`);
     });
+  }
+
+  private _assertAllEventsPublishedByDirectives(directives: DirectiveAst[], events: BoundEventAst[],
+                                                sourceInfo: string) {
+    var allDirectiveEvents = new Set<string>();
+    directives.forEach(directive => {
+      StringMapWrapper.forEach(directive.directive.outputs,
+                               (eventName, _) => { allDirectiveEvents.add(eventName); });
+    });
     events.forEach(event => {
-      this._reportError(
-          `Event binding ${event.name} on an embedded template in ${event.sourceInfo}`);
+      if (isPresent(event.target) || !SetWrapper.has(allDirectiveEvents, event.name)) {
+        this._reportError(
+            `Event binding ${event.fullName} not emitted by any directive on an embedded template in ${sourceInfo}`);
+      }
     });
   }
 }
diff --git a/modules/angular2/test/core/compiler/template_parser_spec.ts b/modules/angular2/test/core/compiler/template_parser_spec.ts
index d1a285fad6..bae38463be 100644
--- a/modules/angular2/test/core/compiler/template_parser_spec.ts
+++ b/modules/angular2/test/core/compiler/template_parser_spec.ts
@@ -267,6 +267,19 @@ export function main() {
               ]);
         });
 
+        it('should allow events on explicit embedded templates that are emitted by a directive',
+           () => {
+             var dirA = CompileDirectiveMetadata.create({
+               selector: 'template',
+               outputs: ['e'],
+               type: new CompileTypeMetadata({name: 'DirA'})
+             });
+             expect(humanizeTemplateAsts(parse('<template (e)="f"></template>', [dirA])))
+                 .toEqual([
+                   [EmbeddedTemplateAst, 'TestComp > template:nth-child(0)'],
+                   [DirectiveAst, dirA, 'TestComp > template:nth-child(0)'],
+                 ]);
+           });
       });
 
       describe('bindon', () => {
@@ -804,7 +817,7 @@ Parser Error: Unexpected token 'b' at column 3 in [a b] in TestComp > div:nth-ch
 More than one component: DirB,DirA in TestComp > div:nth-child(0)`);
       });
 
-      it('should not allow components or element nor event bindings on explicit embedded templates',
+      it('should not allow components or element bindings nor dom events on explicit embedded templates',
          () => {
            var dirA = CompileDirectiveMetadata.create({
              selector: '[a]',
@@ -814,9 +827,9 @@ More than one component: DirB,DirA in TestComp > div:nth-child(0)`);
            });
            expect(() => parse('<template [a]="b" (e)="f"></template>', [dirA]))
                .toThrowError(`Template parse errors:
+Event binding e not emitted by any directive on an embedded template in TestComp > template:nth-child(0)
 Components on an embedded template: DirA in TestComp > template:nth-child(0)
-Property binding a not used by any directive on an embedded template in TestComp > template:nth-child(0)[[a]=b]
-Event binding e on an embedded template in TestComp > template:nth-child(0)[(e)=f]`);
+Property binding a not used by any directive on an embedded template in TestComp > template:nth-child(0)[[a]=b]`);
          });
 
       it('should not allow components or element bindings on inline embedded templates', () => {
diff --git a/modules/angular2/test/core/linker/integration_spec.ts b/modules/angular2/test/core/linker/integration_spec.ts
index 29bb364f16..3ad977abf4 100644
--- a/modules/angular2/test/core/linker/integration_spec.ts
+++ b/modules/angular2/test/core/linker/integration_spec.ts
@@ -800,7 +800,7 @@ export function main() {
                });
          }));
 
-      it('should support events via EventEmitter',
+      it('should support events via EventEmitter on regular elements',
          inject([TestComponentBuilder, AsyncTestCompleter], (tcb: TestComponentBuilder, async) => {
            tcb.overrideView(MyComp, new ViewMetadata({
                               template: '<div emitter listener></div>',
@@ -825,6 +825,31 @@ export function main() {
                });
          }));
 
+      it('should support events via EventEmitter on template elements',
+         inject([TestComponentBuilder, AsyncTestCompleter], (tcb: TestComponentBuilder, async) => {
+           tcb.overrideView(MyComp, new ViewMetadata({
+                              template: '<template emitter listener></template>',
+                              directives: [DirectiveEmitingEvent, DirectiveListeningEvent]
+                            }))
+
+               .createAsync(MyComp)
+               .then((rootTC) => {
+
+                 var tc = rootTC.debugElement.componentViewChildren[0];
+                 var emitter = tc.inject(DirectiveEmitingEvent);
+                 var listener = tc.inject(DirectiveListeningEvent);
+
+                 expect(listener.msg).toEqual('');
+
+                 ObservableWrapper.subscribe(emitter.event, (_) => {
+                   expect(listener.msg).toEqual('fired !');
+                   async.done();
+                 });
+
+                 emitter.fireEvent('fired !');
+               });
+         }));
+
       it('should support [()] syntax',
          inject([TestComponentBuilder, AsyncTestCompleter], (tcb: TestComponentBuilder, async) => {
            tcb.overrideView(MyComp, new ViewMetadata({