diff --git a/Tag.cpp b/Tag.cpp
index c0a75ae..5344eb2 100644
--- a/Tag.cpp
+++ b/Tag.cpp
@@ -125,12 +125,12 @@ namespace jet {
       return resolved;
    }   
 
-   void Tag::processContainer(coreutils::ZString &container) {
+   void Tag::processContainer(coreutils::ZString &container, coreutils::ZString container2) {
       if(hasContainer && evaluate)
-	parseContainer(container, out);      
+	parseContainer(container, out, container2);      
    }
       
-   void Tag::parseContainer(coreutils::ZString &in, coreutils::MString &out) {
+   void Tag::parseContainer(coreutils::ZString &in, coreutils::MString &out, coreutils::ZString container2) {
       coreutils::ZString tag;
       char *start = in.getCursor();
       while(!in.eod()) {
@@ -205,8 +205,7 @@ namespace jet {
 	       __dotag _dotag(in, out, global, this, local);
 	       continue;
 	    } else if(ifTagName(in, "container")) {
-	       while(!containerOut.eod()) 
-		 out.write(containerOut.nextChar());
+	       processContainer(container2);
 	       in.ifNext("<container");
 	       in.skipWhitespace();
 	       in.ifNext("/>");
diff --git a/Tag.h b/Tag.h
index cb86fba..d63ad57 100644
--- a/Tag.h
+++ b/Tag.h
@@ -30,8 +30,8 @@ namespace jet {
       bool hasContainer = false;
       bool hasContainer2 = false;
       bool keywordDefined(coreutils::ZString variable);
-      void parseContainer(coreutils::ZString &in, coreutils::MString &out);
-      void processContainer(coreutils::ZString &container);
+      void parseContainer(coreutils::ZString &in, coreutils::MString &out, coreutils::ZString container2 = NULL);
+      void processContainer(coreutils::ZString &container, coreutils::ZString container2 = NULL);
       void copyContainer(coreutils::ZString &in, coreutils::MString &out);
 
       coreutils::MString &parentOut;
diff --git a/__dotag.cpp b/__dotag.cpp
index 55a839a..c6b596c 100644
--- a/__dotag.cpp
+++ b/__dotag.cpp
@@ -8,8 +8,7 @@ namespace jet {
 	parseContainer(container, containerOut);
       containerOut.reset();
       coreutils::ZString container3 = global.tags[name];
-      hasContainer = true;      
-      processContainer(container3);
+      processContainer(container3, container);
    }
 }
 
diff --git a/__tag.cpp b/__tag.cpp
index 68c66a2..5930660 100644
--- a/__tag.cpp
+++ b/__tag.cpp
@@ -10,7 +10,7 @@ namespace jet {
 	throw coreutils::Exception("tag must have a name.");
       if(!hasContainer)
 	throw coreutils::Exception("tag requires a container to process.");
-      global.tags[keywords["name"]] = container;  // TODO: process container for further tag definitions. 
+      global.tags[keywords["name"]] = container; 
    }
 }
 
diff --git a/tests/testtag.jet b/tests/testtag.jet
index 222d2ba..d2d5ff3 100755
--- a/tests/testtag.jet
+++ b/tests/testtag.jet
@@ -1,22 +1,11 @@
 #!../jet-2.0
 <jet filterblanklines="true" trimlines="true">
 <tag name="testform">
- <tag name="testinput">
-  <input type="input" name="name" value="#[test]" /> 
- </tag>
  <form>
- 1-$[test]
  <container />
- 2-$[test]
- #[test]
- </form> 
+ /form>
 </tag>
-<set name="ix" value="1" />
-<testform test="this is a var">
- a
- <testinput />
- <set name="test" value="itsset" />
- b
+<testform>
+ xxx
 </testform>
-<testinput />
 </jet>