diff --git a/tracks/app/controllers/todo_controller.rb b/tracks/app/controllers/todo_controller.rb
index 17f9b6d9..b3979a71 100644
--- a/tracks/app/controllers/todo_controller.rb
+++ b/tracks/app/controllers/todo_controller.rb
@@ -206,6 +206,23 @@ class TodoController < ApplicationController
       end
     end
   end
+  
+  def update_project
+    self.init
+    @item = check_user_return_item
+    project = Project.find(params['project_id']);
+    if @user == project.user
+      @original_item_context_id = @item.context_id
+      @item.project_id = project.id
+      @item.project = project
+      @saved = @item.save
+      render :action => 'update_action'
+    else
+      render :update do |page| 
+        page.replace_html "info", content_tag("div", "Error updating the project of the dragged item. Item and project user mis-match: #{@item.user.name} and #{@project.user.name}! - refresh the page to see them.", "class" => "warning")
+      end
+    end
+  end
 
   def deferred_update_action
     #self.init
diff --git a/tracks/app/views/shared/sidebar.rhtml b/tracks/app/views/shared/sidebar.rhtml
index 010a9e7a..963b0c8e 100644
--- a/tracks/app/views/shared/sidebar.rhtml
+++ b/tracks/app/views/shared/sidebar.rhtml
@@ -1,7 +1,7 @@
 <h3>Active Projects:</h3>
 <ul>
   <% for project in @projects.reject{|p| p.done? } -%>
-    <li><%= link_to( sanitize(project.name), { :controller => "project", :action => "show", 
+    <li id="sidebar-project-<%= project.id %>" class="sidebar-project"><%= link_to( sanitize(project.name), { :controller => "project", :action => "show", 
             :name => urlize(project.name) } ) + " (" + project.count_undone_todos("actions") + ")" %></li>
   <% end -%>
 </ul>
@@ -9,7 +9,7 @@
 <h3>Completed Projects:</h3>
 <ul>
   <% for project in @projects.reject{|p| !p.done? } -%>
-    <li><%= link_to( sanitize(project.name), { :controller => "project", :action => "show",
+    <li id="sidebar-project-<%= project.id %>" class="sidebar-project"><%= link_to( sanitize(project.name), { :controller => "project", :action => "show",
             :name => urlize(project.name) } ) + " (" + project.count_undone_todos("actions") + ")" %></li>
   <% end -%>
 </ul>
@@ -17,7 +17,7 @@
 <h3>Active Contexts:</h3>
 <ul>
   <% for context in @contexts.reject{|c| c.hide? } -%>
-  <li><%= link_to( sanitize(context.name), { :controller => "context", :action => "show",
+  <li id="sidebar-context-<%= context.id %>" class="sidebar-context"><%= link_to( sanitize(context.name), { :controller => "context", :action => "show",
           :name => urlize(context.name) } ) + " (" + context.count_undone_todos("actions") + ")" %></li>
   <% end -%>
 </ul>
@@ -25,7 +25,7 @@
 <h3>Hidden Contexts:</h3>
 <ul>
   <% for context in @contexts.reject{|c| !c.hide? } -%>
-  <li><%= link_to( sanitize(context.name), { :controller => "context", :action => "show",
+  <li id="sidebar-context-<%= context.id %>" class="sidebar-context"><%= link_to( sanitize(context.name), { :controller => "context", :action => "show",
           :name => urlize(context.name) } ) + " (" + context.count_undone_todos("actions") + ")" %></li>
   <% end -%>
 </ul>
diff --git a/tracks/app/views/todo/update_action.rjs b/tracks/app/views/todo/update_action.rjs
index 952dae81..af0da8d2 100644
--- a/tracks/app/views/todo/update_action.rjs
+++ b/tracks/app/views/todo/update_action.rjs
@@ -1,9 +1,8 @@
 if @saved
   item_container_id = "item-#{@item.id}-container"
-  logger.info("@item.context_id = #{@item.context_id}")
-  logger.info("@original_item_context.id = #{@original_item_context_id}")
   if @item.context_id == @original_item_context_id
     page.replace_html item_container_id, :partial => 'todo/item'
+    page.call "todoItems.makeItemDraggable", item_container_id
     page.visual_effect :highlight, item_container_id, :duration => 3
   else
     page["item-#{@item.id}-container"].remove
diff --git a/tracks/public/javascripts/todo-items.js b/tracks/public/javascripts/todo-items.js
index 4ab26782..d3a6e0dc 100644
--- a/tracks/public/javascripts/todo-items.js
+++ b/tracks/public/javascripts/todo-items.js
@@ -162,6 +162,12 @@ var todoItems = {
     $$('.context').each(function(contextElem){
       todoItems.makeContextDroppable(contextElem);
     });
+    $$('.sidebar-project').each(function(projectElem){
+      todoItems.makeProjectDroppable(projectElem);
+    });
+    $$('.sidebar-context').each(function(contextElem){
+      todoItems.makeContextDroppable(contextElem);
+    });
   },
   makeItemDraggable: function(itemContainerElem)
   {
@@ -179,8 +185,16 @@ var todoItems = {
 	  {
 		  accept:'item-container',
 		  hoverclass:'item-container-drop-target',
-		  onDrop: todoItems.itemDrop,
-		  zindex: 1000
+		  onDrop: todoItems.itemContextDrop
+    });
+  },
+  makeProjectDroppable: function(projectElem)
+  {
+	  Droppables.add($(projectElem).id,
+	  {
+		  accept:'item-container',
+		  hoverclass:'item-container-drop-target',
+		  onDrop: todoItems.itemProjectDrop
     });
   },
   startDraggingItem:function(draggable)
@@ -195,7 +209,7 @@ var todoItems = {
     todoItems.setNextActionListingTogglesToCookiedState();
   },
   
-  itemDrop:function(draggableElement, droppableElement) {
+  itemContextDrop:function(draggableElement, droppableElement) {
     if (draggableElement.parentContainer == droppableElement) {
       return; //same destination as original, nothing to be done
     } 
@@ -212,6 +226,24 @@ var todoItems = {
       evalScripts:true,
       parameters:"id=" + todoId + "&context_id=" + contextId
     })
+  },
+  itemProjectDrop:function(draggableElement, droppableElement) {
+    if (draggableElement.parentContainer == droppableElement) {
+      return; //same destination as original, nothing to be done
+    } 
+    itemElementId = draggableElement.id
+    todoId = draggableElement.id.match(/\d+/)[0];
+    projectId = droppableElement.id.match(/\d+/)[0];
+    Draggables.drags.each(function(drag) {
+      if (drag.element == draggableElement) {
+        drag.destroy();
+      }
+    })
+    new Ajax.Request('/todo/update_project', {
+      asynchronous:true,
+      evalScripts:true,
+      parameters:"id=" + todoId + "&project_id=" + projectId
+    })
   }
 }
 Event.observe(window, "load", todoItems.addNextActionListingToggles);