diff --git a/tests/icles/.gitignore b/tests/icles/.gitignore
index d8083fdb22..82bd9b212e 100644
--- a/tests/icles/.gitignore
+++ b/tests/icles/.gitignore
@@ -4,4 +4,5 @@ test-textoverlay
 test-scale
 test-box
 test-colorkey
+test-xoverlay
 playbin-text
diff --git a/tests/icles/Makefile.am b/tests/icles/Makefile.am
index fa49403ce7..a88a832aeb 100644
--- a/tests/icles/Makefile.am
+++ b/tests/icles/Makefile.am
@@ -7,12 +7,17 @@ stress_xoverlay_LDADD = $(GST_LIBS) $(X_LIBS) $(LIBM) \
 	$(top_builddir)/gst-libs/gst/interfaces/libgstinterfaces-$(GST_MAJORMINOR).la
 
 if HAVE_GTK_X11
-X_TESTS += test-colorkey
+X_TESTS += test-colorkey test-xoverlay
 
 test_colorkey_SOURCES = test-colorkey.c
 test_colorkey_CFLAGS = $(GST_PLUGINS_BASE_CFLAGS) $(GST_CFLAGS) $(X_CFLAGS) $(GTK_CFLAGS)
 test_colorkey_LDADD = $(GST_LIBS) $(X_LIBS) $(LIBM) $(GTK_LIBS) \
 	$(top_builddir)/gst-libs/gst/interfaces/libgstinterfaces-$(GST_MAJORMINOR).la
+
+test_xoverlay_SOURCES = test-xoverlay.c
+test_xoverlay_CFLAGS = $(GST_PLUGINS_BASE_CFLAGS) $(GST_CFLAGS) $(X_CFLAGS) $(GTK_CFLAGS)
+test_xoverlay_LDADD = $(GST_LIBS) $(X_LIBS) $(LIBM) $(GTK_LIBS) \
+	$(top_builddir)/gst-libs/gst/interfaces/libgstinterfaces-$(GST_MAJORMINOR).la
 endif
 
 else
diff --git a/tests/icles/test-xoverlay.c b/tests/icles/test-xoverlay.c
new file mode 100644
index 0000000000..b1dc239466
--- /dev/null
+++ b/tests/icles/test-xoverlay.c
@@ -0,0 +1,228 @@
+/* GStreamer
+ * Copyright (C) <2008> Stefan Kost <ensonic@users.sf.net>
+ *
+ * test-xoverlay: test xoverlay custom event handling and subregions
+ *
+ * This library is free software; you can redistribute it and/or
+ * modify it under the terms of the GNU Library General Public
+ * License as published by the Free Software Foundation; either
+ * version 2 of the License, or (at your option) any later version.
+ *
+ * This library is distributed in the hope that it will be useful,
+ * but WITHOUT ANY WARRANTY; without even the implied warranty of
+ * MERCHANTABILITY or FITNESS FOR A PARTICULAR PURPOSE.  See the GNU
+ * Library General Public License for more details.
+ *
+ * You should have received a copy of the GNU Library General Public
+ * License along with this library; if not, write to the
+ * Free Software Foundation, Inc., 59 Temple Place - Suite 330,
+ * Boston, MA 02111-1307, USA.
+ */
+
+#ifdef HAVE_CONFIG_H
+#include "config.h"
+#endif
+
+#include <stdlib.h>
+#include <string.h>
+#include <math.h>
+
+#include <glib.h>
+#include <gdk/gdkx.h>
+#include <gtk/gtk.h>
+
+#include <gst/gst.h>
+#include <gst/interfaces/xoverlay.h>
+#include <gst/video/gstvideosink.h>
+
+static struct
+{
+  gint w, h;
+  GstXOverlay *overlay;
+  GtkWidget *widget;
+  gdouble a, p;
+  GstVideoRectangle rect;
+  gboolean running;
+} anim_state;
+gboolean verbose = FALSE;
+
+static gboolean
+animate_render_rect (gpointer user_data)
+{
+  if (anim_state.running) {
+    GstVideoRectangle *r = &anim_state.rect;
+    gdouble s = sin (3.0 * anim_state.a);
+    gdouble c = cos (2.0 * anim_state.a);
+
+    anim_state.a += anim_state.p;
+    if (anim_state.a > (M_PI + M_PI))
+      anim_state.a -= (M_PI + M_PI);
+
+    r->w = anim_state.w / 2;
+    r->x = (r->w - (r->w / 2)) + c * (r->w / 2);
+    r->h = anim_state.h / 2;
+    r->y = (r->h - (r->h / 2)) + s * (r->h / 2);
+
+    gst_x_overlay_set_render_rectangle (anim_state.overlay, r);
+    gtk_widget_queue_draw (anim_state.widget);
+  }
+  return TRUE;
+}
+
+static gboolean
+handle_resize_cb (GtkWidget * widget, GdkEventConfigure * event,
+    gpointer user_data)
+{
+  GtkAllocation allocation;
+
+  gtk_widget_get_allocation (widget, &allocation);
+  if (verbose) {
+    g_print ("resize(%p): %dx%d\n", widget, allocation.width,
+        allocation.height);
+  }
+  anim_state.w = allocation.width;
+  anim_state.h = allocation.height;
+  animate_render_rect (NULL);
+
+  return FALSE;
+}
+
+static gboolean
+handle_expose_cb (GtkWidget * widget, GdkEventExpose * event,
+    gpointer user_data)
+{
+  GstVideoRectangle *r = &anim_state.rect;
+
+  /* we should only redraw outside of the video rect! */
+  /*
+     gdk_draw_rectangle (widget->window, widget->style->bg_gc[0], TRUE,
+     0, 0, widget->allocation.width, widget->allocation.height);
+     gdk_draw_rectangle (widget->window, widget->style->bg_gc[0], TRUE,
+     event->area.x, event->area.y, event->area.width, event->area.height);
+   */
+  gdk_draw_rectangle (widget->window, widget->style->bg_gc[0], TRUE,
+      0, event->area.y, r->x, event->area.height);
+  gdk_draw_rectangle (widget->window, widget->style->bg_gc[0], TRUE,
+      r->x + r->w, event->area.y,
+      widget->allocation.width - (r->x + r->w), event->area.height);
+
+  gdk_draw_rectangle (widget->window, widget->style->bg_gc[0], TRUE,
+      event->area.x, 0, event->area.width, r->y);
+  gdk_draw_rectangle (widget->window, widget->style->bg_gc[0], TRUE,
+      event->area.x, r->y + r->h,
+      event->area.width, widget->allocation.height - (r->y + r->h));
+  if (verbose) {
+    g_print ("expose(%p)\n", widget);
+  }
+  gst_x_overlay_expose (anim_state.overlay);
+  return FALSE;
+}
+
+static void
+window_closed (GtkWidget * widget, GdkEvent * event, gpointer user_data)
+{
+  GstElement *pipeline = user_data;
+
+  if (verbose) {
+    g_print ("stopping\n");
+  }
+  anim_state.running = FALSE;
+  gtk_widget_hide_all (widget);
+  gst_element_set_state (pipeline, GST_STATE_NULL);
+  gtk_main_quit ();
+}
+
+gint
+main (gint argc, gchar ** argv)
+{
+  GtkWidget *window, *video_window;
+  GstElement *pipeline, *src, *sink;
+  GstStateChangeReturn sret;
+  gulong embed_xid = 0;
+  gboolean force_aspect = FALSE, draw_borders = FALSE;
+
+  if (!g_thread_supported ())
+    g_thread_init (NULL);
+
+  gst_init (&argc, &argv);
+  gtk_init (&argc, &argv);
+
+  if (argc) {
+    gint arg;
+    for (arg = 0; arg < argc; arg++) {
+      if (!strcmp (argv[arg], "-a"))
+        force_aspect = TRUE;
+      else if (!strcmp (argv[arg], "-b"))
+        draw_borders = TRUE;
+      else if (!strcmp (argv[arg], "-v"))
+        verbose = TRUE;
+    }
+  }
+
+  /* prepare the pipeline */
+
+  pipeline = gst_pipeline_new ("xvoverlay");
+  src = gst_element_factory_make ("videotestsrc", NULL);
+  sink = gst_element_factory_make ("xvimagesink", NULL);
+  gst_bin_add_many (GST_BIN (pipeline), src, sink, NULL);
+  gst_element_link (src, sink);
+
+  g_object_set (G_OBJECT (sink), "handle-events", FALSE,
+      "force-aspect-ratio", force_aspect, "draw-borders", draw_borders, NULL);
+
+  /* prepare the ui */
+
+  window = gtk_window_new (GTK_WINDOW_TOPLEVEL);
+  g_signal_connect (G_OBJECT (window), "delete-event",
+      G_CALLBACK (window_closed), (gpointer) pipeline);
+  gtk_window_set_default_size (GTK_WINDOW (window), 320, 240);
+
+  video_window = gtk_drawing_area_new ();
+  gtk_widget_set_double_buffered (video_window, FALSE);
+  gtk_container_add (GTK_CONTAINER (window), video_window);
+
+  /* show the gui and play */
+  gtk_widget_show_all (window);
+
+  /* realize window now so that the video window gets created and we can
+   * obtain its XID before the pipeline is started up and the videosink
+   * asks for the XID of the window to render onto */
+  gtk_widget_realize (window);
+
+  embed_xid = GDK_WINDOW_XID (video_window->window);
+  if (verbose) {
+    g_print ("Window realize: got XID %lu\n", embed_xid);
+  }
+
+  /* we know what the video sink is in this case (xvimagesink), so we can
+   * just set it directly here now (instead of waiting for a prepare-xwindow-id
+   * element message in a sync bus handler and setting it there) */
+  gst_x_overlay_set_xwindow_id (GST_X_OVERLAY (sink), embed_xid);
+
+  anim_state.overlay = GST_X_OVERLAY (sink);
+  anim_state.widget = video_window;
+  anim_state.w = 320;
+  anim_state.h = 240;
+  anim_state.a = 0.0;
+  anim_state.p = (M_PI + M_PI) / 200.0;
+
+  handle_resize_cb (video_window, NULL, sink);
+  g_signal_connect (video_window, "configure-event",
+      G_CALLBACK (handle_resize_cb), NULL);
+  g_signal_connect (video_window, "expose-event",
+      G_CALLBACK (handle_expose_cb), NULL);
+
+  g_timeout_add (50, (GSourceFunc) animate_render_rect, NULL);
+
+  /* run the pipeline */
+  sret = gst_element_set_state (pipeline, GST_STATE_PLAYING);
+  if (sret == GST_STATE_CHANGE_FAILURE)
+    gst_element_set_state (pipeline, GST_STATE_NULL);
+  else {
+    anim_state.running = TRUE;
+    gtk_main ();
+  }
+
+  gst_object_unref (pipeline);
+  return 0;
+}