diff --git a/readme.md b/readme.md
index 0957969..f042fb3 100644
--- a/readme.md
+++ b/readme.md
@@ -30,6 +30,7 @@ and directories have special meanings.
 
     tests/
       setup
+      setup_dir
       bar/
         setup
         test_that_something_works
@@ -46,11 +47,11 @@ and directories have special meanings.
       teardown
 
 Directories are processed in a depth-first order. When a particular directory
-is processed, `setup` is sourced before everything else in the directory, including
-subdirectories. Export variables from the setup function to make them available
-to other files in the same directory.
+is processed, `setup_dir` is run before everything else in the directory, including
+subdirectories. `teardown_dir` is run after everything else in the directory. 
 
-`teardown` is run after everything else in the directory. 
+A directory's `setup` file, if it exists, is run right before each test file
+within the particular directory, and the `teardown` file is run right after.
 
 Files are only run if they are executable, and files beginning with `.` are
 ignored. Thus, fixtures and libraries can be included sloppily within the test
diff --git a/urchin b/urchin
index 9e6371f..4448923 100755
--- a/urchin
+++ b/urchin
@@ -12,7 +12,7 @@ recurse() {
     then
     (
       cd "$potential_test"
-      [ -f setup_dir ] && . ./setup_dir
+      [ -f setup_dir ] && [ -x setup_dir ] && . ./setup_dir
       for test in *
         do recurse "${test}"
       done
@@ -23,10 +23,12 @@ recurse() {
     #stdout_file=$(mktemp)
     stdout_file=/tmp/urchin_stdout
 
+    [ -f setup ] && [ -x setup ] && . ./setup &>> $stdout_file
+
     # Run the test
-    [ -f setup ] && . ./setup &>> $stdout_file
     ./"$potential_test" &>> $stdout_file
     exit_code="$?"
+
     [ -f teardown ] && [ -x teardown ] && ./teardown &>> $stdout_file
 
     if [ "$exit_code" = '0' ]
@@ -38,7 +40,7 @@ recurse() {
       # On fail, print a red '✗'
       echo -ne '\033[31m✗ \033[0m'
       echo "${potential_test}"
-      cat $stdout_file
+#     cat $stdout_file
     fi
     rm $stdout_file
   fi