diff --git a/res/drawable-hdpi/ic_content_new.png b/res/drawable-hdpi/ic_content_new.png
new file mode 100755
index 000000000000..5741995cbed7
Binary files /dev/null and b/res/drawable-hdpi/ic_content_new.png differ
diff --git a/res/drawable-hdpi/ic_content_remove.png b/res/drawable-hdpi/ic_content_remove.png
new file mode 100755
index 000000000000..656439a31477
Binary files /dev/null and b/res/drawable-hdpi/ic_content_remove.png differ
diff --git a/res/drawable-hdpi/ic_level_indicator.png b/res/drawable-hdpi/ic_level_indicator.png
new file mode 100644
index 000000000000..d0a42cafc576
Binary files /dev/null and b/res/drawable-hdpi/ic_level_indicator.png differ
diff --git a/res/drawable-mdpi/ic_content_new.png b/res/drawable-mdpi/ic_content_new.png
new file mode 100755
index 000000000000..884c9d270377
Binary files /dev/null and b/res/drawable-mdpi/ic_content_new.png differ
diff --git a/res/drawable-mdpi/ic_content_remove.png b/res/drawable-mdpi/ic_content_remove.png
new file mode 100644
index 000000000000..9de7acc8fd51
Binary files /dev/null and b/res/drawable-mdpi/ic_content_remove.png differ
diff --git a/res/drawable-mdpi/ic_level_indicator.png b/res/drawable-mdpi/ic_level_indicator.png
new file mode 100644
index 000000000000..2f4a852cefd6
Binary files /dev/null and b/res/drawable-mdpi/ic_level_indicator.png differ
diff --git a/res/drawable-xhdpi/ic_content_new.png b/res/drawable-xhdpi/ic_content_new.png
new file mode 100755
index 000000000000..9b48a63dad67
Binary files /dev/null and b/res/drawable-xhdpi/ic_content_new.png differ
diff --git a/res/drawable-xhdpi/ic_content_remove.png b/res/drawable-xhdpi/ic_content_remove.png
new file mode 100644
index 000000000000..52b695f339d2
Binary files /dev/null and b/res/drawable-xhdpi/ic_content_remove.png differ
diff --git a/res/drawable-xhdpi/ic_level_indicator.png b/res/drawable-xhdpi/ic_level_indicator.png
new file mode 100644
index 000000000000..08ebe5225e04
Binary files /dev/null and b/res/drawable-xhdpi/ic_level_indicator.png differ
diff --git a/res/drawable-xxhdpi/ic_level_indicator.png b/res/drawable-xxhdpi/ic_level_indicator.png
new file mode 100644
index 000000000000..932da74a7b60
Binary files /dev/null and b/res/drawable-xxhdpi/ic_level_indicator.png differ
diff --git a/res/layout/add_account.xml b/res/layout/add_account.xml
index 79fee1a4c38a..ad5f0eb42960 100644
--- a/res/layout/add_account.xml
+++ b/res/layout/add_account.xml
@@ -20,7 +20,7 @@
             android:src="@drawable/wpcom" />
 
         <RelativeLayout
-            android:id="@+id/section1"
+            android:id="@+id/sectionContent"
             android:layout_width="fill_parent"
             android:layout_height="fill_parent"
             android:layout_below="@id/wpcomLogo"
@@ -93,7 +93,7 @@
             android:id="@+id/l_wordpressdotcom"
             android:layout_width="wrap_content"
             android:layout_height="wrap_content"
-            android:layout_below="@id/section1"
+            android:layout_below="@id/sectionContent"
             android:layout_centerHorizontal="true"
             android:layout_marginTop="24dp"
             android:shadowColor="#FFFFFF"
diff --git a/res/layout/add_account_settings.xml b/res/layout/add_account_settings.xml
index 17b33084815d..125e36220758 100644
--- a/res/layout/add_account_settings.xml
+++ b/res/layout/add_account_settings.xml
@@ -15,7 +15,7 @@
         android:paddingRight="10dip" >
 
         <RelativeLayout
-            android:id="@+id/section1"
+            android:id="@+id/sectionContent"
             android:layout_width="fill_parent"
             android:layout_height="fill_parent"
             android:layout_marginTop="10dip"
diff --git a/res/layout/blog_preferences.xml b/res/layout/blog_preferences.xml
index 362651a8ef94..ad8355d2c328 100644
--- a/res/layout/blog_preferences.xml
+++ b/res/layout/blog_preferences.xml
@@ -14,7 +14,7 @@
         android:paddingRight="@dimen/settings_padding" >
 
         <RelativeLayout
-            android:id="@+id/section1"
+            android:id="@+id/sectionContent"
             android:layout_width="fill_parent"
             android:layout_height="wrap_content" >
 
@@ -69,10 +69,10 @@
         </RelativeLayout>
 
         <RelativeLayout
-            android:id="@+id/section2"
+            android:id="@+id/sectionTags"
             android:layout_width="fill_parent"
             android:layout_height="wrap_content"
-            android:layout_below="@id/section1"
+            android:layout_below="@id/sectionContent"
             android:layout_marginTop="8dp" >
 
             <TextView
@@ -131,10 +131,10 @@
         </RelativeLayout>
 
         <RelativeLayout
-            android:id="@+id/section3"
+            android:id="@+id/sectionLocation"
             android:layout_width="fill_parent"
             android:layout_height="wrap_content"
-            android:layout_below="@id/section2"
+            android:layout_below="@id/sectionTags"
             android:layout_marginTop="8dp" >
 
             <TextView
@@ -153,10 +153,10 @@
         </RelativeLayout>
 
         <RelativeLayout
-            android:id="@+id/section4"
+            android:id="@+id/sectionSettings"
             android:layout_width="fill_parent"
             android:layout_height="wrap_content"
-            android:layout_below="@id/section3"
+            android:layout_below="@id/sectionLocation"
             android:layout_marginTop="8dp" >
 
             <TextView
diff --git a/res/layout/categories_row.xml b/res/layout/categories_row.xml
index 9f5731845f92..d0a4ff96dcb8 100644
--- a/res/layout/categories_row.xml
+++ b/res/layout/categories_row.xml
@@ -1,13 +1,24 @@
 <?xml version="1.0" encoding="utf-8"?>
-<CheckedTextView
-  xmlns:android="http://schemas.android.com/apk/res/android"
-  android:orientation="vertical"
-  android:layout_width="fill_parent"
-  android:layout_height="?android:attr/listPreferredItemHeight"
-  android:textAppearance="?android:attr/textAppearanceLarge"
-  android:gravity="center_vertical"
-  android:textColor="#464646"
-  android:paddingLeft="6dip"
-  android:paddingRight="6dip"
-  android:checkMark="?android:attr/listChoiceIndicatorMultiple" />
 
+<org.wordpress.android.util.CheckedLinearLayout
+        xmlns:android="http://schemas.android.com/apk/res/android"
+        android:layout_width="match_parent"
+        android:layout_height="@dimen/category_row_height"
+        android:orientation="horizontal"
+        android:id="@+id/categoryRow" android:clickable="false">
+    <ImageView android:layout_width="@dimen/category_row_height"
+               android:layout_height="@dimen/category_row_height"
+               android:src="@drawable/ic_level_indicator"
+               android:id="@+id/categoryRowLevelIndicator" android:scaleType="fitEnd"/>
+    <CheckedTextView
+            android:orientation="vertical"
+            android:layout_width="fill_parent"
+            android:layout_height="fill_parent"
+            android:textAppearance="?android:attr/textAppearanceLarge"
+            android:gravity="center_vertical"
+            android:textColor="#464646"
+            android:paddingLeft="6dip"
+            android:paddingRight="6dip"
+            android:checkMark="?android:attr/listChoiceIndicatorMultiple"
+            android:id="@+id/categoryRowText"/>
+</org.wordpress.android.util.CheckedLinearLayout>
\ No newline at end of file
diff --git a/res/layout/category_button.xml b/res/layout/category_button.xml
new file mode 100644
index 000000000000..5cbb5d61840d
--- /dev/null
+++ b/res/layout/category_button.xml
@@ -0,0 +1,8 @@
+<?xml version="1.0" encoding="utf-8"?>
+<Button
+    xmlns:android="http://schemas.android.com/apk/res/android"
+    style="?android:attr/buttonStyleSmall"
+    android:layout_width="wrap_content"
+    android:layout_height="fill_parent"
+    android:id="@+id/categoryButton"
+    android:drawableRight="@drawable/ic_content_remove" android:paddingEnd="5dp"/>
diff --git a/res/layout/category_select_button.xml b/res/layout/category_select_button.xml
new file mode 100644
index 000000000000..1468917d86e9
--- /dev/null
+++ b/res/layout/category_select_button.xml
@@ -0,0 +1,9 @@
+<?xml version="1.0" encoding="utf-8"?>
+<Button
+        xmlns:android="http://schemas.android.com/apk/res/android"
+        style="?android:attr/buttonStyleSmall"
+        android:layout_width="wrap_content"
+        android:layout_height="fill_parent"
+        android:id="@+id/selectCategories"
+        android:drawableRight="@drawable/ic_content_new"
+        android:tag="select-category"/>
diff --git a/res/layout/edit.xml b/res/layout/edit.xml
index 099b9e0d87c1..048d5d1cbdf4 100644
--- a/res/layout/edit.xml
+++ b/res/layout/edit.xml
@@ -18,7 +18,7 @@
             android:padding="8dp" >
 
             <LinearLayout
-                android:id="@+id/section1"
+                android:id="@+id/sectionContent"
                 android:layout_width="fill_parent"
                 android:layout_height="wrap_content"
                 android:layout_marginBottom="10dp"
@@ -45,11 +45,11 @@
             </LinearLayout>
 
             <LinearLayout
-                android:id="@+id/section2"
+                android:id="@+id/sectionTags"
                 android:layout_width="fill_parent"
                 android:layout_height="wrap_content"
                 android:layout_marginBottom="10dp"
-                android:orientation="vertical" >
+                android:orientation="vertical">
 
                 <EditText
                     android:id="@+id/tags"
@@ -59,25 +59,22 @@
                     android:hint="@string/tags_separate_with_commas"
                     android:inputType="textAutoCorrect" />
 
-                <Button
-                    android:id="@+id/selectCategories"
-                    android:layout_width="wrap_content"
-                    android:layout_height="wrap_content"
-                    android:layout_marginTop="4dp"
-                    android:text="@string/select_categories" />
-
                 <TextView
-                    android:id="@+id/selectedCategories"
-                    android:layout_width="wrap_content"
-                    android:layout_height="wrap_content"
-                    android:layout_marginLeft="4dp"
-                    android:text="@string/selected_categories"
-                    android:textColor="#444444"
-                    android:visibility="gone" />
+                        android:id="@+id/categoryLabel"
+                        style="@style/WordPressSubHeader"
+                        android:layout_width="wrap_content"
+                        android:layout_height="wrap_content"
+                        android:text="@string/category" />
+
             </LinearLayout>
 
+            <org.wordpress.android.util.FlowLayout
+                    android:layout_width="fill_parent"
+                    android:layout_height="wrap_content" android:id="@+id/sectionCategories" android:paddingLeft="8dp">
+            </org.wordpress.android.util.FlowLayout>
+
             <RelativeLayout
-                android:id="@+id/section3"
+                android:id="@+id/sectionLocation"
                 android:layout_width="fill_parent"
                 android:layout_height="fill_parent"
                 android:layout_marginBottom="10dp"
@@ -127,7 +124,7 @@
             </RelativeLayout>
 
             <LinearLayout
-                android:id="@+id/section4"
+                android:id="@+id/sectionSettings"
                 android:layout_width="fill_parent"
                 android:layout_height="wrap_content"
                 android:layout_marginBottom="10dp"
diff --git a/res/layout/edit_comment.xml b/res/layout/edit_comment.xml
index 27ca683b7461..128be05bce54 100644
--- a/res/layout/edit_comment.xml
+++ b/res/layout/edit_comment.xml
@@ -17,7 +17,7 @@
         android:paddingTop="8dp" >
 
         <RelativeLayout
-            android:id="@+id/section1"
+            android:id="@+id/sectionContent"
             android:layout_width="fill_parent"
             android:layout_height="0dp"
             android:layout_weight="1"
diff --git a/res/values/attrs.xml b/res/values/attrs.xml
new file mode 100644
index 000000000000..6b0a36396465
--- /dev/null
+++ b/res/values/attrs.xml
@@ -0,0 +1,11 @@
+<?xml version="1.0" encoding="utf-8"?>
+<resources>
+    <declare-styleable name="FlowLayout">
+        <attr name="horizontalSpacing" format="dimension"/>
+        <attr name="verticalSpacing" format="dimension"/>
+    </declare-styleable>
+    <declare-styleable name="FlowLayout_LayoutParams">
+        <attr name="layout_horizontalSpacing" format="dimension"/>
+        <attr name="layout_verticalSpacing" format="dimension"/>
+    </declare-styleable>
+</resources>
\ No newline at end of file
diff --git a/res/values/dimens.xml b/res/values/dimens.xml
index 200f94f2ae97..8f8b01ca1c34 100644
--- a/res/values/dimens.xml
+++ b/res/values/dimens.xml
@@ -12,4 +12,5 @@
     <dimen name="menu_shadow_width">4dp</dimen>
     <dimen name="add_account_width">-1dp</dimen>
     <dimen name="refresh_icon_padding">12dp</dimen>
+    <dimen name="category_row_height">60dp</dimen>
 </resources>
diff --git a/res/values/strings.xml b/res/values/strings.xml
index 59918edca045..fe8d7b178a98 100644
--- a/res/values/strings.xml
+++ b/res/values/strings.xml
@@ -241,6 +241,7 @@
   <string name="media">Media</string>
 
   <!-- category management -->
+  <string name="category">Category</string>
   <string name="add_new_category">Add New Category</string>
   <string name="category_name">Category Name</string>
   <string name="category_slug">Category Slug (optional)</string>
diff --git a/src/org/wordpress/android/WordPressDB.java b/src/org/wordpress/android/WordPressDB.java
index 2818ca250e70..f09fd4bea4d1 100644
--- a/src/org/wordpress/android/WordPressDB.java
+++ b/src/org/wordpress/android/WordPressDB.java
@@ -34,7 +34,7 @@
 
 public class WordPressDB {
 
-    private static final int DATABASE_VERSION = 17;
+    private static final int DATABASE_VERSION = 18;
 
     private static final String CREATE_TABLE_SETTINGS = "create table if not exists accounts (id integer primary key autoincrement, "
             + "url text, blogName text, username text, password text, imagePlacement text, centerThumbnail boolean, fullSizeImage boolean, maxImageWidth text, maxImageWidthId integer, lastCommentId integer, runService boolean);";
@@ -125,6 +125,9 @@ public class WordPressDB {
 
     private static final String ADD_BLOG_OPTIONS = "alter table accounts add blog_options text default '';";
 
+    // add category parent id to keep track of category hierarchy
+    private static final String ADD_PARENTID_IN_CATEGORIES = "alter table cats add parent_id integer default 0;";
+
     private SQLiteDatabase db;
 
     protected static final String PASSWORD_SECRET = Config.DB_SECRET;
@@ -181,6 +184,7 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePasswords();
                 db.setVersion(DATABASE_VERSION); // set to latest revision
             } else if (db.getVersion() == 1) { // v1.0 or v1.0.1
@@ -213,6 +217,7 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePasswords();
                 migratePreferences(ctx);
                 migrateWPComAccount();
@@ -245,6 +250,7 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePasswords();
                 migratePreferences(ctx);
                 migrateWPComAccount();
@@ -274,6 +280,7 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePasswords();
                 migratePreferences(ctx);
                 migrateWPComAccount();
@@ -303,6 +310,7 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePasswords();
                 migratePreferences(ctx);
                 migrateWPComAccount();
@@ -357,6 +365,7 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePasswords();
                 migratePreferences(ctx);
                 migrateWPComAccount();
@@ -375,6 +384,7 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePasswords();
                 migratePreferences(ctx);
                 migrateWPComAccount();
@@ -392,6 +402,7 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePasswords();
                 migratePreferences(ctx);
                 migrateWPComAccount();
@@ -409,6 +420,7 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePasswords();
                 migratePreferences(ctx);
                 migrateWPComAccount();
@@ -481,6 +493,7 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePreferences(ctx);
                 migrateWPComAccount();
                 db.setVersion(DATABASE_VERSION);
@@ -491,6 +504,7 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePreferences(ctx);
                 migrateWPComAccount();
                 db.setVersion(DATABASE_VERSION);
@@ -498,27 +512,35 @@ public WordPressDB(Context ctx) {
                 db.execSQL(ADD_FEATURED_IN_POST);
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePreferences(ctx);
                 migrateWPComAccount();
                 db.setVersion(DATABASE_VERSION);
             } else if (db.getVersion() == 13) {
                 db.execSQL(ADD_HOME_URL);
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePreferences(ctx);
                 migrateWPComAccount();
                 db.setVersion(DATABASE_VERSION);
             } else if (db.getVersion() == 14) {
                 db.execSQL(ADD_BLOG_OPTIONS);
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePreferences(ctx);
                 migrateWPComAccount();
                 db.setVersion(DATABASE_VERSION);
             } else if (db.getVersion() == 15) {
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migratePreferences(ctx);
                 migrateWPComAccount();
                 db.setVersion(DATABASE_VERSION);
             } else if (db.getVersion() == 16) {
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
                 migrateWPComAccount();
                 db.setVersion(DATABASE_VERSION);
+            } else if (db.getVersion() == 17) {
+                db.execSQL(ADD_PARENTID_IN_CATEGORIES);
+                db.setVersion(DATABASE_VERSION);
             }
         } catch (SQLException e) {
             e.printStackTrace();
@@ -1228,10 +1250,10 @@ public long savePost(Post post, int blogID) {
             values.put("description", post.getDescription());
             values.put("mt_text_more", post.getMt_text_more());
 
-            if (post.getCategories() != null) {
+            if (post.getJSONCategories() != null) {
                 JSONArray jsonArray = null;
                 try {
-                    jsonArray = new JSONArray(post.getCategories().toString());
+                    jsonArray = new JSONArray(post.getJSONCategories().toString());
                     values.put("categories", jsonArray.toString());
                 } catch (JSONException e) {
                     e.printStackTrace();
@@ -1269,10 +1291,10 @@ public int updatePost(Post post, int blogID) {
                 values.put("mt_text_more", post.getMt_text_more());
             values.put("uploaded", post.isUploaded());
 
-            if (post.getCategories() != null) {
+            if (post.getJSONCategories() != null) {
                 JSONArray jsonArray = null;
                 try {
-                    jsonArray = new JSONArray(post.getCategories().toString());
+                    jsonArray = new JSONArray(post.getJSONCategories().toString());
                     values.put("categories", jsonArray.toString());
                 } catch (JSONException e) {
                     e.printStackTrace();
@@ -1553,12 +1575,13 @@ public long getStatsDate() {
     }
 
     // categories
-    public boolean insertCategory(int id, int wp_id, String category_name) {
+    public boolean insertCategory(int id, int wp_id, int parent_id, String category_name) {
 
         ContentValues values = new ContentValues();
         values.put("blog_id", id);
         values.put("wp_id", wp_id);
         values.put("category_name", category_name.toString());
+        values.put("parent_id", parent_id);
         boolean returnValue = false;
         synchronized (this) {
             returnValue = db.insert(CATEGORIES_TABLE, null, values) > 0;
@@ -1600,6 +1623,18 @@ public int getCategoryId(int id, String category) {
         return categoryID;
     }
 
+    public int getCategoryParentId(int id, String category) {
+        Cursor c = db.query(CATEGORIES_TABLE, new String[] { "parent_id" },
+                "category_name=\"" + category + "\" AND blog_id=" + id, null,
+                null, null, null);
+        if (c.getCount() == 0)
+            return -1;
+        c.moveToFirst();
+        int categoryParentID = c.getInt(0);
+
+        return categoryParentID;
+    }
+
     public void clearCategories(int id) {
 
         // clear out the table since we are refreshing the whole enchilada
diff --git a/src/org/wordpress/android/models/CategoryNode.java b/src/org/wordpress/android/models/CategoryNode.java
new file mode 100644
index 000000000000..20814cfac4ba
--- /dev/null
+++ b/src/org/wordpress/android/models/CategoryNode.java
@@ -0,0 +1,107 @@
+package org.wordpress.android.models;
+
+import android.util.SparseArray;
+import org.wordpress.android.WordPress;
+
+import java.util.*;
+
+public class CategoryNode {
+    private int categoryId;
+    private String name;
+    private int parentId;
+    private int level;
+    SortedMap<String, CategoryNode> children = new TreeMap<String, CategoryNode>(new Comparator<String>() {
+        @Override
+        public int compare(String s, String s2) {
+            return s.compareToIgnoreCase(s2);
+        }
+    });
+
+    public SortedMap<String, CategoryNode> getChildren() {
+        return children;
+    }
+
+    public void setChildren(SortedMap<String, CategoryNode> children) {
+        this.children = children;
+    }
+
+    public CategoryNode(int categoryId, int parentId, String name) {
+        this.categoryId = categoryId;
+        this.parentId = parentId;
+        this.name = name;
+    }
+
+    public int getCategoryId() {
+        return categoryId;
+    }
+
+    public void setCategoryId(int categoryId) {
+        this.categoryId = categoryId;
+    }
+
+    public String getName() {
+        return name;
+    }
+
+    public void setName(String name) {
+        this.name = name;
+    }
+
+    public int getParentId() {
+        return parentId;
+    }
+
+    public void setParentId(int parentId) {
+        this.parentId = parentId;
+    }
+
+    public int getLevel() {
+        return level;
+    }
+
+    public static CategoryNode createCategoryTreeFromDB(int blogId) {
+        List<String> stringCategories = WordPress.wpDB.loadCategories(blogId);
+
+        // First pass instantiate CategoryNode objects
+        SparseArray<CategoryNode> categoryMap = new SparseArray<CategoryNode>();
+        CategoryNode rootCategory = new CategoryNode(-1, -1, "");
+        CategoryNode currentRootNode;
+        for (String name : stringCategories) {
+            int categoryId = WordPress.wpDB.getCategoryId(blogId, name);
+            int parentId = WordPress.wpDB.getCategoryParentId(blogId, name);
+            CategoryNode node = new CategoryNode(categoryId, parentId, name);
+            categoryMap.put(categoryId, node);
+        }
+
+        // Second pass associate nodes to form a tree
+        for(int i = 0; i < categoryMap.size(); i++){
+            CategoryNode category = categoryMap.valueAt(i);
+            if (category.getParentId() == 0) { // root node
+                currentRootNode = rootCategory;
+            } else {
+                currentRootNode = categoryMap.get(category.getParentId());
+            }
+            currentRootNode.children.put(category.getName(), categoryMap.get(category.getCategoryId()));
+        }
+        return rootCategory;
+    }
+
+    private static void preOrderTreeTraversal(CategoryNode node, int level, ArrayList<CategoryNode> returnValue) {
+        if (node == null) {
+            return ;
+        }
+        if (node.parentId != -1) {
+            node.level = level;
+            returnValue.add(node);
+        }
+        for (CategoryNode child : node.getChildren().values()) {
+            preOrderTreeTraversal(child, level + 1, returnValue);
+        }
+    }
+
+    public static ArrayList<CategoryNode> getSortedListOfCategoriesFromRoot(CategoryNode node) {
+        ArrayList<CategoryNode> sortedCategories = new ArrayList<CategoryNode>();
+        preOrderTreeTraversal(node, 0, sortedCategories);
+        return sortedCategories;
+    }
+}
\ No newline at end of file
diff --git a/src/org/wordpress/android/models/Post.java b/src/org/wordpress/android/models/Post.java
index 113485e096b7..71f058f652ba 100644
--- a/src/org/wordpress/android/models/Post.java
+++ b/src/org/wordpress/android/models/Post.java
@@ -158,7 +158,7 @@ public void setLocalDraft(boolean localDraft) {
         this.localDraft = localDraft;
     }
 
-    public JSONArray getCategories() {
+    public JSONArray getJSONCategories() {
         JSONArray jArray = null;
         if (categories == null)
             categories = "";
@@ -169,7 +169,7 @@ public JSONArray getCategories() {
         return jArray;
     }
 
-    public void setCategories(JSONArray categories) {
+    public void setJSONCategories(JSONArray categories) {
         this.categories = categories.toString();
     }
 
diff --git a/src/org/wordpress/android/ui/accounts/AccountSetupActivity.java b/src/org/wordpress/android/ui/accounts/AccountSetupActivity.java
index 0297ada9729f..2eac6fbba77a 100644
--- a/src/org/wordpress/android/ui/accounts/AccountSetupActivity.java
+++ b/src/org/wordpress/android/ui/accounts/AccountSetupActivity.java
@@ -489,7 +489,7 @@ public void run() {
                             Thread shake = new Thread() {
                                 public void run() {
                                     Animation shake = AnimationUtils.loadAnimation(AccountSetupActivity.this, R.anim.shake);
-                                    findViewById(R.id.section1).startAnimation(shake);
+                                    findViewById(R.id.sectionContent).startAnimation(shake);
                                     Toast.makeText(AccountSetupActivity.this, getString(R.string.invalid_login), Toast.LENGTH_SHORT).show();
                                 }
                             };
diff --git a/src/org/wordpress/android/ui/posts/AddCategoryActivity.java b/src/org/wordpress/android/ui/posts/AddCategoryActivity.java
index 9ada4ff6c6f4..a84148ee235e 100644
--- a/src/org/wordpress/android/ui/posts/AddCategoryActivity.java
+++ b/src/org/wordpress/android/ui/posts/AddCategoryActivity.java
@@ -17,6 +17,7 @@
 
 import org.wordpress.android.R;
 import org.wordpress.android.WordPress;
+import org.wordpress.android.models.CategoryNode;
 
 public class AddCategoryActivity extends Activity {
     private int id;
@@ -100,33 +101,29 @@ public void onClick(View v) {
                  finish();
             }
         });
-
     }
 
     private void loadCategories() {
         ArrayList<CharSequence> loadTextArray = new ArrayList<CharSequence>();
-        loadTextArray.clear();
-        List<?> categoriesVector = WordPress.wpDB.loadCategories(id);
-        if (categoriesVector.size() > 0)
-        {
-
+        CategoryNode rootCategory = CategoryNode.createCategoryTreeFromDB(id);
+        ArrayList<CategoryNode> categoryLevels = CategoryNode.getSortedListOfCategoriesFromRoot(rootCategory);
+        if (categoryLevels.size() > 0) {
             loadTextArray.add(getResources().getText(R.string.none));
-
-            for(int i=0; i < categoriesVector.size(); i++)
-            {
-                loadTextArray.add(categoriesVector.get(i).toString());
+            for (int i = 0; i < categoryLevels.size(); i++) {
+                CategoryNode currentCategory = categoryLevels.get(i);
+                String name = "";
+                for (int j = 1; j < currentCategory.getLevel(); j++) {
+                    name += "  ";
+                }
+                name += currentCategory.getName();
+                loadTextArray.add(name);
             }
-
-            ArrayAdapter<CharSequence> categories = new ArrayAdapter<CharSequence>(this, android.R.layout.simple_dropdown_item_1line, loadTextArray);
+            ArrayAdapter<CharSequence> categories = new ArrayAdapter<CharSequence>(this,
+                    android.R.layout.simple_dropdown_item_1line, loadTextArray);
             categories.setDropDownViewResource(android.R.layout.simple_spinner_dropdown_item);
-
             Spinner sCategories = (Spinner) findViewById(R.id.parent_category);
-
-
             sCategories.setAdapter(categories);
-
         }
-
     }
 
     @Override
diff --git a/src/org/wordpress/android/ui/posts/CategoryArrayAdapter.java b/src/org/wordpress/android/ui/posts/CategoryArrayAdapter.java
new file mode 100644
index 000000000000..817702cc5190
--- /dev/null
+++ b/src/org/wordpress/android/ui/posts/CategoryArrayAdapter.java
@@ -0,0 +1,39 @@
+package org.wordpress.android.ui.posts;
+
+import android.content.Context;
+import android.view.LayoutInflater;
+import android.view.View;
+import android.view.ViewGroup;
+import android.widget.ArrayAdapter;
+import android.widget.ImageView;
+import android.widget.TextView;
+import org.wordpress.android.R;
+import org.wordpress.android.models.CategoryNode;
+import org.wordpress.android.util.EscapeUtils;
+
+import java.util.List;
+
+public class CategoryArrayAdapter extends ArrayAdapter<CategoryNode> {
+
+    public CategoryArrayAdapter(Context context, int resource, List<CategoryNode> objects) {
+        super(context, resource, objects);
+    }
+
+    @Override
+    public View getView(int position, View convertView, ViewGroup parent) {
+        LayoutInflater inflater = (LayoutInflater) getContext().getSystemService(Context.LAYOUT_INFLATER_SERVICE);
+        View rowView = inflater.inflate(R.layout.categories_row, parent, false);
+        TextView textView = (TextView) rowView.findViewById(R.id.categoryRowText);
+        ImageView levelIndicatorView = (ImageView) rowView.findViewById(R.id.categoryRowLevelIndicator);
+        textView.setText(EscapeUtils.escapeHtml(getItem(position).getName()));
+        int level = getItem(position).getLevel();
+        if (level == 1) { // hide ImageView
+            levelIndicatorView.setVisibility(View.GONE);
+        } else {
+            ViewGroup.LayoutParams params = levelIndicatorView.getLayoutParams();
+            params.width = (params.width / 2) * level;
+            levelIndicatorView.setLayoutParams(params);
+        }
+        return rowView;
+    }
+}
diff --git a/src/org/wordpress/android/ui/posts/EditPostActivity.java b/src/org/wordpress/android/ui/posts/EditPostActivity.java
index db9f9efb33ae..c20cf6f66e3c 100644
--- a/src/org/wordpress/android/ui/posts/EditPostActivity.java
+++ b/src/org/wordpress/android/ui/posts/EditPostActivity.java
@@ -46,34 +46,14 @@
 import android.text.style.StrikethroughSpan;
 import android.text.style.StyleSpan;
 import android.text.style.URLSpan;
-import android.view.ContextMenu;
-import android.view.Display;
-import android.view.LayoutInflater;
-import android.view.MenuItem;
-import android.view.MotionEvent;
-import android.view.View;
+import android.view.*;
 import android.view.View.OnClickListener;
 import android.view.View.OnFocusChangeListener;
 import android.view.View.OnTouchListener;
-import android.view.WindowManager;
 import android.view.animation.AlphaAnimation;
-import android.widget.ArrayAdapter;
-import android.widget.Button;
-import android.widget.CheckBox;
-import android.widget.CompoundButton;
+import android.widget.*;
 import android.widget.CompoundButton.OnCheckedChangeListener;
-import android.widget.DatePicker;
-import android.widget.EditText;
-import android.widget.ImageButton;
-import android.widget.LinearLayout;
-import android.widget.RelativeLayout;
-import android.widget.SeekBar;
 import android.widget.SeekBar.OnSeekBarChangeListener;
-import android.widget.Spinner;
-import android.widget.TextView;
-import android.widget.TimePicker;
-import android.widget.Toast;
-import android.widget.ToggleButton;
 
 import com.actionbarsherlock.app.ActionBar;
 import com.actionbarsherlock.app.SherlockActivity;
@@ -82,7 +62,7 @@
 import com.google.gson.reflect.TypeToken;
 
 import org.json.JSONArray;
-import org.json.JSONException;
+import org.wordpress.android.util.*;
 import org.xmlrpc.android.ApiHelper;
 
 import org.wordpress.android.Constants;
@@ -92,17 +72,7 @@
 import org.wordpress.android.models.MediaFile;
 import org.wordpress.android.models.Post;
 import org.wordpress.android.ui.accounts.NewAccountActivity;
-import org.wordpress.android.util.DeviceUtils;
-import org.wordpress.android.util.EscapeUtils;
-import org.wordpress.android.util.ImageHelper;
-import org.wordpress.android.util.LocationHelper;
 import org.wordpress.android.util.LocationHelper.LocationResult;
-import org.wordpress.android.util.PostUploadService;
-import org.wordpress.android.util.StringUtils;
-import org.wordpress.android.util.WPEditText;
-import org.wordpress.android.util.WPHtml;
-import org.wordpress.android.util.WPImageSpan;
-import org.wordpress.android.util.WPUnderlineSpan;
 
 public class EditPostActivity extends SherlockActivity implements OnClickListener, OnTouchListener, TextWatcher,
         WPEditText.OnSelectionChangedListener, OnFocusChangeListener, WPEditText.EditTextImeBackListener {
@@ -120,6 +90,8 @@ public class EditPostActivity extends SherlockActivity implements OnClickListene
     private static final int ID_DIALOG_TIME = 1;
     private static final int ID_DIALOG_LOADING = 2;
 
+    private static final String CATEGORY_PREFIX_TAG = "category-";
+
     private Blog mBlog;
     private Post mPost;
 
@@ -127,7 +99,7 @@ public class EditPostActivity extends SherlockActivity implements OnClickListene
     private ImageButton mAddPictureButton;
     private Spinner mStatusSpinner;
     private EditText mTitleEditText, mPasswordEditText, mTagsEditText;
-    private TextView mLocationText, mCategoriesText, mPubDateText;
+    private TextView mLocationText, mPubDateText;
     private ToggleButton mBoldToggleButton, mEmToggleButton, mBquoteToggleButton;
     private ToggleButton mUnderlineToggleButton, mStrikeToggleButton;
     private Button mPubDateButton, mLinkButton, mMoreButton;
@@ -136,7 +108,7 @@ public class EditPostActivity extends SherlockActivity implements OnClickListene
     private Location mCurrentLocation;
     private LocationHelper mLocationHelper;
     private Handler mAutoSaveHandler;
-    private JSONArray mCategories;
+    private List<String> mCategories;
 
     private boolean mIsPage = false;
     private boolean mIsNew = false;
@@ -147,7 +119,6 @@ public class EditPostActivity extends SherlockActivity implements OnClickListene
     private boolean mIsNewDraft = false;
     private boolean mIsExternalInstance = false;
 
-    private List<String> mSelectedCategories;
     private String mAccountName = "";
     private int mQuickMediaType = -1;
     private String mMediaCapturePath = "";
@@ -181,9 +152,8 @@ public void onCreate(Bundle savedInstanceState) {
         mDay = c.get(Calendar.DAY_OF_MONTH);
         mHour = c.get(Calendar.HOUR_OF_DAY);
         mMinute = c.get(Calendar.MINUTE);
-        mCategories = new JSONArray();
+        mCategories = new ArrayList<String>();
         mAutoSaveHandler = new Handler();
-        mSelectedCategories = new Vector<String>();
 
         String action = getIntent().getAction();
         if (Intent.ACTION_SEND.equals(action) || Intent.ACTION_SEND_MULTIPLE.equals(action)) {
@@ -261,7 +231,6 @@ public void onCreate(Bundle savedInstanceState) {
         mBquoteToggleButton = (ToggleButton) findViewById(R.id.bquote);
         mUnderlineToggleButton = (ToggleButton) findViewById(R.id.underline);
         mStrikeToggleButton = (ToggleButton) findViewById(R.id.strike);
-        mCategoriesText = (TextView) findViewById(R.id.selectedCategories);
         mAddPictureButton = (ImageButton) findViewById(R.id.addPictureButton);
         mPubDateButton = (Button) findViewById(R.id.pubDateButton);
         mPubDateText = (TextView) findViewById(R.id.pubDate);
@@ -277,8 +246,9 @@ public void onCreate(Bundle savedInstanceState) {
         ((TextView) findViewById(R.id.pubDateLabel)).setText(getResources().getString(R.string.publish_date).toUpperCase());
 
         if (mIsPage) { // remove post specific views
-            ((LinearLayout) findViewById(R.id.section2)).setVisibility(View.GONE);
-            ((RelativeLayout) findViewById(R.id.section3)).setVisibility(View.GONE);
+            ((LinearLayout) findViewById(R.id.sectionTags)).setVisibility(View.GONE);
+            ((FlowLayout) findViewById(R.id.sectionCategories)).setVisibility(View.GONE);
+            ((RelativeLayout) findViewById(R.id.sectionLocation)).setVisibility(View.GONE);
             ((TextView) findViewById(R.id.postFormatLabel)).setVisibility(View.GONE);
             ((Spinner) findViewById(R.id.postFormat)).setVisibility(View.GONE);
         } else {
@@ -427,21 +397,8 @@ else if (mQuickMediaType == Constants.QUICK_POST_VIDEO_LIBRARY)
             }
 
             if (!mIsPage) {
-                if (mPost.getCategories() != null) {
-                    mCategories = mPost.getCategories();
-                    if (!mCategories.equals("")) {
-
-                        for (int i = 0; i < mCategories.length(); i++) {
-                            try {
-                                mSelectedCategories.add(mCategories.getString(i));
-                            } catch (JSONException e) {
-                                e.printStackTrace();
-                            }
-                        }
-                        mCategoriesText.setVisibility(View.VISIBLE);
-                        mCategoriesText.setText(getString(R.string.selected_categories) + " "
-                                + getCategoriesCSV());
-                    }
+                if (mPost.getJSONCategories() != null) {
+                    mCategories = JSONUtil.fromJSONArrayToStringList(mPost.getJSONCategories());
                 }
 
                 Double latitude = mPost.getLatitude();
@@ -451,17 +408,13 @@ else if (mQuickMediaType == Constants.QUICK_POST_VIDEO_LIBRARY)
                     new getAddressTask().execute(latitude, longitude);
                 }
             }
-
             String tags = mPost.getMt_keywords();
             if (!tags.equals("")) {
                 mTagsEditText.setText(tags);
             }
         }
 
-        if (!mIsPage) {
-            Button selectCategories = (Button) findViewById(R.id.selectCategories);
-            selectCategories.setOnClickListener(this);
-        }
+        populateSelectedCategories();
 
         registerForContextMenu(mAddPictureButton);
         mContentEditText.setOnSelectionChangedListener(this);
@@ -580,20 +533,20 @@ public void onFocusChange(View v, boolean hasFocus) {
         else if (!hasFocus && mFormatBar.getVisibility() == View.VISIBLE)
             hideFormatBar();
     }
-    
+
     @Override
     public void onImeBack(WPEditText ctrl, String text) {
         if (mFormatBar.getVisibility() == View.VISIBLE)
             hideFormatBar();
     }
-    
+
     private void showFormatBar() {
         mFormatBar.setVisibility(View.VISIBLE);
         AlphaAnimation fadeInAnimation = new AlphaAnimation(0.0f, 1.0f);
         fadeInAnimation.setDuration(500);
         mFormatBar.startAnimation(fadeInAnimation);
     }
-    
+
     private void hideFormatBar() {
         AlphaAnimation fadeOutAnimation = new AlphaAnimation(1.0f, 0.0f);
         fadeOutAnimation.setDuration(500);
@@ -640,12 +593,14 @@ public void onClick(View v) {
         } else if (id == R.id.selectCategories) {
             Bundle bundle = new Bundle();
             bundle.putInt("id", mBlogID);
-            if (mCategories.length() > 0) {
+            if (mCategories.size() > 0) {
                 bundle.putString("categoriesCSV", getCategoriesCSV());
             }
             Intent i1 = new Intent(EditPostActivity.this, SelectCategoriesActivity.class);
             i1.putExtras(bundle);
             startActivityForResult(i1, ACTIVITY_REQUEST_CODE_SELECT_CATEGORIES);
+        } else if (id == R.id.categoryButton) {
+            onCategoryButtonClick(v);
         } else if (id == R.id.post) {
             if (mAutoSaveHandler != null)
                 mAutoSaveHandler.removeCallbacks(autoSaveRunnable);
@@ -657,7 +612,7 @@ public void onClick(View v) {
                         else if (mQuickMediaType == Constants.QUICK_POST_VIDEO_CAMERA || mQuickMediaType == Constants.QUICK_POST_VIDEO_LIBRARY)
                             mPost.setQuickPostType("QuickVideo");
                     }
-                    
+
                     WordPress.currentPost = mPost;
                     startService(new Intent(this, PostUploadService.class));
                 }
@@ -693,10 +648,10 @@ else if (mQuickMediaType == Constants.QUICK_POST_VIDEO_CAMERA || mQuickMediaType
 
     @Override
     public boolean onTouch(View v, MotionEvent event) {
-        
+
         if (mFormatBar.getVisibility() != View.VISIBLE)
             showFormatBar();
-        
+
         float pos = event.getY();
 
         if (event.getAction() == 0)
@@ -909,7 +864,7 @@ private boolean selectBlogForShareAction() {
 
         mIsNew = true;
         mLocalDraft = true;
-        
+
         List<Map<String, Object>> accounts = WordPress.wpDB.getAccounts();
 
         if (accounts.size() > 0) {
@@ -1226,7 +1181,7 @@ public void run() {
 
     private void enableLBSButtons() {
         mLocationHelper = new LocationHelper();
-        ((RelativeLayout) findViewById(R.id.section3)).setVisibility(View.VISIBLE);
+        ((RelativeLayout) findViewById(R.id.sectionLocation)).setVisibility(View.VISIBLE);
         Button viewMap = (Button) findViewById(R.id.viewMap);
         Button updateLocation = (Button) findViewById(R.id.updateLocation);
         Button removeLocation = (Button) findViewById(R.id.removeLocation);
@@ -1341,19 +1296,76 @@ protected void onActivityResult(int requestCode, int resultCode, Intent data) {
                 extras = data.getExtras();
                 String cats = extras.getString("selectedCategories");
                 String[] splitCats = cats.split(",");
-                if (splitCats.length < 1)
-                    return;
-                mCategories = new JSONArray();
-                for (int i = 0; i < splitCats.length; i++) {
-                    mCategories.put(splitCats[i]);
+                mCategories = new ArrayList<String>();
+                if (splitCats.length >= 1) {
+                    for (int i = 0; i < splitCats.length; i++) {
+                        if (!splitCats[i].isEmpty()) {
+                            mCategories.add(splitCats[i]);
+                        }
+                    }
                 }
-                mCategoriesText.setVisibility(View.VISIBLE);
-                mCategoriesText.setText(getString(R.string.selected_categories) + " " + getCategoriesCSV());
+                populateSelectedCategories();
                 break;
             }
         }// end null check
     }
 
+    private void onCategoryButtonClick(View v) {
+        // Get category name by removing prefix from the tag
+        boolean listChanged = false;
+        String categoryName = (String) v.getTag();
+        categoryName = categoryName.replaceFirst(CATEGORY_PREFIX_TAG, "");
+
+        // Remove clicked category from list
+        for (int i = 0; i < mCategories.size(); i++) {
+            if (mCategories.get(i).equals(categoryName)) {
+                mCategories.remove(i);
+                listChanged = true;
+                break;
+            }
+        }
+
+        // Recreate category views
+        if (listChanged) {
+            populateSelectedCategories();
+        }
+    }
+
+    private void populateSelectedCategories() {
+        ViewGroup sectionCategories = ((ViewGroup) findViewById(R.id.sectionCategories));
+
+        // Remove previous category buttons if any + select category button
+        List<View> viewsToRemove = new ArrayList<View>();
+        for (int i = 0; i < sectionCategories.getChildCount(); i++) {
+            View v = sectionCategories.getChildAt(i);
+            Object tag = v.getTag();
+            if (tag != null && tag.getClass() == String.class &&
+                    (((String) tag).startsWith(CATEGORY_PREFIX_TAG) || tag.equals("select-category"))) {
+                viewsToRemove.add(v);
+            }
+        }
+        for (int i = 0; i < viewsToRemove.size(); i++) {
+            sectionCategories.removeView(viewsToRemove.get(i));
+        }
+        viewsToRemove.clear();
+
+        // New category buttons
+        LayoutInflater layoutInflater = getLayoutInflater();
+        for (int i = 0; i < mCategories.size(); i++) {
+            String categoryName = mCategories.get(i);
+            Button buttonCategory = (Button) layoutInflater.inflate(R.layout.category_button, null);
+            buttonCategory.setText(categoryName);
+            buttonCategory.setTag(CATEGORY_PREFIX_TAG + categoryName);
+            buttonCategory.setOnClickListener(this);
+            sectionCategories.addView(buttonCategory);
+        }
+
+        // Add select category button
+        Button selectCategory = (Button) layoutInflater.inflate(R.layout.category_select_button, null);
+        selectCategory.setOnClickListener(this);
+        sectionCategories.addView(selectCategory);
+    }
+
     @Override
     protected Dialog onCreateDialog(int id) {
 
@@ -1572,7 +1584,7 @@ public void onClick(DialogInterface dialog, int whichButton) {
                 }
                 mPost.setMediaPaths(images);
                 mPost.setDate_created_gmt(pubDateTimestamp);
-                mPost.setCategories(mCategories);
+                mPost.setJSONCategories(new JSONArray(mCategories));
                 mPost.setMt_keywords(tags);
                 mPost.setPost_status(status);
                 mPost.setWP_password(password);
@@ -1694,28 +1706,28 @@ protected void onPostExecute(SpannableStringBuilder result) {
     private void setWPImageSpanWidth(Uri curStream, WPImageSpan is) {
         String imageWidth = WordPress.currentBlog.getMaxImageWidth();
         int imageWidthBlogSetting = Integer.MAX_VALUE;
-        
+
         if (!imageWidth.equals("Original Size")) {
             try {
                 imageWidthBlogSetting = Integer.valueOf(imageWidth);
             } catch (NumberFormatException e) {
                 e.printStackTrace();
             }
-        } 
-        
+        }
+
         int[] dimensions = ImageHelper.getImageSize(curStream, EditPostActivity.this);
         int imageWidthPictureSetting = dimensions[0] == 0 ? Integer.MAX_VALUE : dimensions[0];
-        
+
         if ( Math.min(imageWidthPictureSetting, imageWidthBlogSetting) ==  Integer.MAX_VALUE ) {
             is.setWidth(1024); //Default value in case of errors reading the picture size and the blog settings is set to Original size
         } else {
             is.setWidth(Math.min(imageWidthPictureSetting, imageWidthBlogSetting));
         }
     }
-    
-    
+
+
     private void addMedia(String imgPath, Uri curStream) {
-        
+
         if (mFormatBar.getVisibility() == View.VISIBLE)
             hideFormatBar();
 
@@ -1861,13 +1873,9 @@ public SpannableStringBuilder addMediaFromShareAction(String imgPath, Uri curStr
 
     private String getCategoriesCSV() {
         String csv = "";
-        if (mCategories.length() > 0) {
-            for (int i = 0; i < mCategories.length(); i++) {
-                try {
-                    csv += EscapeUtils.unescapeHtml(mCategories.getString(i)) + ",";
-                } catch (JSONException e) {
-                    e.printStackTrace();
-                }
+        if (mCategories.size() > 0) {
+            for (int i = 0; i < mCategories.size(); i++) {
+                csv += EscapeUtils.unescapeHtml(mCategories.get(i)) + ",";
             }
             csv = csv.substring(0, csv.length() - 1);
         }
diff --git a/src/org/wordpress/android/ui/posts/SelectCategoriesActivity.java b/src/org/wordpress/android/ui/posts/SelectCategoriesActivity.java
index 06e86b32a9f4..615b77335999 100644
--- a/src/org/wordpress/android/ui/posts/SelectCategoriesActivity.java
+++ b/src/org/wordpress/android/ui/posts/SelectCategoriesActivity.java
@@ -1,10 +1,6 @@
 package org.wordpress.android.ui.posts;
 
-import java.util.ArrayList;
-import java.util.HashMap;
-import java.util.List;
-import java.util.Map;
-import java.util.Vector;
+import java.util.*;
 
 import android.app.AlertDialog;
 import android.app.ProgressDialog;
@@ -13,8 +9,8 @@
 import android.content.res.Configuration;
 import android.os.Bundle;
 import android.os.Handler;
+import android.text.TextUtils;
 import android.util.SparseBooleanArray;
-import android.widget.ArrayAdapter;
 import android.widget.ListView;
 import android.widget.Toast;
 
@@ -24,29 +20,26 @@
 import com.actionbarsherlock.view.MenuInflater;
 import com.actionbarsherlock.view.MenuItem;
 
+import org.wordpress.android.models.CategoryNode;
 import org.xmlrpc.android.XMLRPCClient;
 import org.xmlrpc.android.XMLRPCException;
 
 import org.wordpress.android.R;
 import org.wordpress.android.WordPress;
 import org.wordpress.android.models.Blog;
-import org.wordpress.android.util.EscapeUtils;
 
 public class SelectCategoriesActivity extends SherlockListActivity {
-    /** Called when the activity is first created. */
     String categoriesCSV = "";
-    long[] checkedCategories;
     private XMLRPCClient client;
-    String finalResult = "", addCategoryResult = "";
+    String finalResult = "";
     ProgressDialog pd;
     public String categoryErrorMsg = "";
-    public ArrayList<CharSequence> textArray = new ArrayList<CharSequence>();
-    public ArrayList<CharSequence> loadTextArray = new ArrayList<CharSequence>();
-    public ArrayList<CharSequence> formattedTextArray = new ArrayList<CharSequence>();
     private final Handler mHandler = new Handler();
     private Blog blog;
-    private int id;
     private ListView lv;
+    private CategoryNode mCategories;
+    private ArrayList<CategoryNode> mCategoryLevels;
+    private Map<String, Integer> mCategoryNames = new HashMap<String, Integer>();
 
     @Override
     public void onCreate(Bundle icicle) {
@@ -65,56 +58,44 @@ public void onCreate(Bundle icicle) {
 
         Bundle extras = getIntent().getExtras();
         if (extras != null) {
-            id = extras.getInt("id");
+            int blogId = extras.getInt("id");
             try {
-                blog = new Blog(id);
+                blog = new Blog(blogId);
             } catch (Exception e) {
                 Toast.makeText(this, getResources().getText(R.string.blog_not_found), Toast.LENGTH_SHORT).show();
                 finish();
             }
-            checkedCategories = extras.getLongArray("checkedCategories");
             categoriesCSV = extras.getString("categoriesCSV");
         }
 
-        loadCategories();
+        populateOrFetchCategories();
     }
 
-    private void loadCategories() {
-        loadTextArray.clear();
-        formattedTextArray.clear();
-        List<?> categoriesVector = WordPress.wpDB.loadCategories(id);
-        if (categoriesVector.size() > 0) {
-
-            for (int i = 0; i < categoriesVector.size(); i++) {
-                loadTextArray.add(categoriesVector.get(i).toString());
-                formattedTextArray.add(EscapeUtils.unescapeHtml(categoriesVector.get(i).toString()));
-            }
-
-            ArrayAdapter<CharSequence> categories = new ArrayAdapter<CharSequence>(this, R.layout.categories_row, formattedTextArray);
-
-            this.setListAdapter(categories);
-
-            if (checkedCategories != null) {
-                ListView lv = getListView();
-                for (int i = 0; i < checkedCategories.length; i++) {
-
-                    lv.setItemChecked((int) checkedCategories[i], true);
+    private void populateCategoryList() {
+        mCategoryLevels = CategoryNode.getSortedListOfCategoriesFromRoot(mCategories);
+        for (int i = 0; i < mCategoryLevels.size(); i++) {
+            mCategoryNames.put(mCategoryLevels.get(i).getName(), i);
+        }
 
+        CategoryArrayAdapter categoryAdapter = new CategoryArrayAdapter(this, R.layout.categories_row, mCategoryLevels);
+        this.setListAdapter(categoryAdapter);
+        if (categoriesCSV != null) {
+            String catsArray[] = categoriesCSV.split(",");
+            ListView lv = getListView();
+            for (String selectedCategory : catsArray) {
+                if (mCategoryNames.keySet().contains(selectedCategory)) {
+                    lv.setItemChecked(mCategoryNames.get(selectedCategory), true);
                 }
+            }
+        }
+    }
 
-            } else if (categoriesCSV != null) {
-                String catsArray[] = categoriesCSV.split(",");
-                ListView lv = getListView();
-                for (int i = 0; i < loadTextArray.size(); i++) {
 
-                    for (int x = 0; x < catsArray.length; x++) {
-                        if (catsArray[x].equals(loadTextArray.get(i).toString())) {
-                            lv.setItemChecked(i, true);
-                        }
-                    }
+    private void populateOrFetchCategories() {
+        mCategories = CategoryNode.createCategoryTreeFromDB(blog.getId());
 
-                }
-            }
+        if (mCategories.getChildren().size() > 0) {
+            populateCategoryList();
         } else {
             refreshCategories();
         }
@@ -127,7 +108,7 @@ public void run() {
                     pd.dismiss();
                 }
 
-                loadCategories();
+                populateOrFetchCategories();
 
                 Toast.makeText(SelectCategoriesActivity.this, getResources().getText(R.string.adding_cat_success), Toast.LENGTH_SHORT).show();
             }
@@ -152,7 +133,7 @@ public void onClick(DialogInterface dialog, int whichButton) {
                 if (pd.isShowing()) {
                     pd.dismiss();
                 }
-                loadCategories();
+                populateOrFetchCategories();
                 Toast.makeText(SelectCategoriesActivity.this, getResources().getText(R.string.categories_refreshed), Toast.LENGTH_SHORT).show();
             } else if (finalResult.equals("FAIL")) {
                 if (pd.isShowing()) {
@@ -175,14 +156,14 @@ public void onClick(DialogInterface dialog, int whichButton) {
         }
     };
 
-    public String getCategories() {
-        // gets the categories via xmlrpc call to wp blog
-        String returnMessage = "";
-
+    /**
+     * Gets the categories via a xmlrpc call
+     * @return result message
+     */
+    public String fetchCategories() {
+        String returnMessage;
         Object result[] = null;
-
         Object[] params = { blog.getBlogId(), blog.getUsername(), blog.getPassword(), };
-
         client = new XMLRPCClient(blog.getUrl(), blog.getHttpuser(), blog.getHttppassword());
 
         boolean success = false;
@@ -195,30 +176,22 @@ public String getCategories() {
         }
 
         if (success) {
-            int size = result.length;
-
             // wipe out the categories table
-            WordPress.wpDB.clearCategories(id);
-
-            for (int i = 0; i < size; i++) {
-                Map<?, ?> curHash = (Map<?, ?>) result[i];
+            WordPress.wpDB.clearCategories(blog.getId());
 
+            for (Object aResult : result) {
+                Map<?, ?> curHash = (Map<?, ?>) aResult;
                 String categoryName = curHash.get("categoryName").toString();
                 String categoryID = curHash.get("categoryId").toString();
-
+                String categoryParentID = curHash.get("parentId").toString();
                 int convertedCategoryID = Integer.parseInt(categoryID);
-
-                WordPress.wpDB.insertCategory(id, convertedCategoryID, categoryName);
-
-                // populate the spinner with the category names
-                textArray.add(categoryName);
+                int convertedCategoryParentID = Integer.parseInt(categoryParentID);
+                WordPress.wpDB.insertCategory(blog.getId(), convertedCategoryID, convertedCategoryParentID, categoryName);
             }
-
             returnMessage = "gotCategories";
         } else {
             returnMessage = "FAIL";
         }
-
         return returnMessage;
     }
 
@@ -234,6 +207,9 @@ public String addCategory(String category_name, String category_slug, String cat
         // Return string
         String returnString = "";
 
+        // Save selected categories
+        categoriesCSV = selectedCategoriesToCSV();
+
         // Store the parameters for wp.addCategory
         Map<String, Object> struct = new HashMap<String, Object>();
         struct.put("name", category_name);
@@ -260,7 +236,7 @@ public String addCategory(String category_name, String category_slug, String cat
             // Convert "result" (= category_id) from type Object to int
             int category_id = Integer.parseInt(result.toString());
             // Insert the new category into database
-            WordPress.wpDB.insertCategory(id, category_id, category_name);
+            WordPress.wpDB.insertCategory(blog.getId(), category_id, parent_id, category_name);
 
             returnString = "addCategory_success";
         }
@@ -276,10 +252,7 @@ protected void onActivityResult(int requestCode, int resultCode, Intent data) {
             final Bundle extras = data.getExtras();
 
             switch (requestCode) {
-            case 0:
-
-                // Add category
-
+            case 0: // Add category
                 // Does the user want to continue, or did he press "dismiss"?
                 if (extras.getString("continue").equals("TRUE")) {
                     // Get name, slug and desc from Intent
@@ -288,19 +261,14 @@ protected void onActivityResult(int requestCode, int resultCode, Intent data) {
                     final String category_desc = extras.getString("category_desc");
                     final int parent_id = extras.getInt("parent_id");
 
-                    if (loadTextArray.contains(category_name)) {
-                        // A category with the specified name already exists
-                    } else {
-                        // Add the category
-                        pd = ProgressDialog.show(SelectCategoriesActivity.this, getResources().getText(R.string.cat_adding_category),
+                    // Check if the category name already exists
+                    if (!mCategoryNames.keySet().contains(category_name)) {
+                        pd = ProgressDialog.show(SelectCategoriesActivity.this,
+                                getResources().getText(R.string.cat_adding_category),
                                 getResources().getText(R.string.cat_attempt_add_category), true, true);
                         Thread th = new Thread() {
                             public void run() {
                                 finalResult = addCategory(category_name, category_slug, category_desc, parent_id);
-
-                                if (finalResult.equals("addCategory_success"))
-                                    loadTextArray.add(category_name);
-
                                 mHandler.post(mUpdateResults);
                             }
                         };
@@ -328,7 +296,7 @@ public boolean onOptionsItemSelected(final MenuItem item) {
             return true;
         } else if (itemId == R.id.menu_new_category) {
             Bundle bundle = new Bundle();
-            bundle.putInt("id", id);
+            bundle.putInt("id", blog.getId());
             Intent i = new Intent(SelectCategoriesActivity.this, AddCategoryActivity.class);
             i.putExtras(bundle);
             startActivityForResult(i, 0);
@@ -346,10 +314,8 @@ private void refreshCategories() {
                 getResources().getText(R.string.attempting_categories_refresh), true, true);
         Thread th = new Thread() {
             public void run() {
-                finalResult = getCategories();
-
+                finalResult = fetchCategories();
                 mHandler.post(mUpdateResults);
-
             }
         };
         th.start();
@@ -367,37 +333,23 @@ public void onBackPressed() {
         super.onBackPressed();
     }
 
-    private void saveAndFinish() {
-        String selectedCategories = "";
-
+    private String selectedCategoriesToCSV() {
+        ArrayList<String> selectedCategories = new ArrayList<String>();
         SparseBooleanArray selectedItems = lv.getCheckedItemPositions();
-        List<Integer> rCheckedItems = new Vector<Integer>();
-
         for (int i = 0; i < selectedItems.size(); i++) {
-            if (selectedItems.get(selectedItems.keyAt(i)) == true) {
-                rCheckedItems.add(selectedItems.keyAt(i));
-                selectedCategories += loadTextArray.get(selectedItems.keyAt(i)).toString() + ",";
+            if (selectedItems.get(selectedItems.keyAt(i))) {
+                selectedCategories.add(mCategoryLevels.get(selectedItems.keyAt(i)).getName());
             }
         }
+        return TextUtils.join(",", selectedCategories);
+    }
 
-        long finalCheckedItems[] = new long[rCheckedItems.size()];
-
-        for (int x = 0; x < rCheckedItems.size(); x++) {
-            finalCheckedItems[x] = Long.parseLong(rCheckedItems.get(x).toString());
-        }
-
+    private void saveAndFinish() {
         Bundle bundle = new Bundle();
-        selectedCategories = selectedCategories.trim();
-        if (selectedCategories.endsWith(",")) {
-            selectedCategories = selectedCategories.substring(0, selectedCategories.length() - 1);
-        }
-
-        bundle.putString("selectedCategories", selectedCategories);
-        bundle.putLongArray("checkedItems", finalCheckedItems);
+        bundle.putString("selectedCategories", selectedCategoriesToCSV());
         Intent mIntent = new Intent();
         mIntent.putExtras(bundle);
         setResult(RESULT_OK, mIntent);
         finish();
     }
-
 }
diff --git a/src/org/wordpress/android/ui/prefs/BlogPreferencesActivity.java b/src/org/wordpress/android/ui/prefs/BlogPreferencesActivity.java
index 732dd4e27812..79ea67f531a5 100644
--- a/src/org/wordpress/android/ui/prefs/BlogPreferencesActivity.java
+++ b/src/org/wordpress/android/ui/prefs/BlogPreferencesActivity.java
@@ -5,7 +5,6 @@
 import android.content.Intent;
 import android.content.res.Configuration;
 import android.location.LocationManager;
-import android.opengl.Visibility;
 import android.os.Bundle;
 import android.view.View;
 import android.widget.AdapterView;
@@ -81,7 +80,7 @@ public void onCreate(Bundle savedInstanceState) {
         
         if (blog.isDotcomFlag()) {
             // Hide credentials section
-            RelativeLayout credentialsRL = (RelativeLayout)findViewById(R.id.section1);
+            RelativeLayout credentialsRL = (RelativeLayout)findViewById(R.id.sectionContent);
             credentialsRL.setVisibility(View.GONE);
         }
         
@@ -274,7 +273,7 @@ public void onClick(View v) {
             mLocationCB.setChecked(blog.isLocation());
         } else {
             mLocationCB.setChecked(false);
-            RelativeLayout locationLayout = (RelativeLayout) findViewById(R.id.section3);
+            RelativeLayout locationLayout = (RelativeLayout) findViewById(R.id.sectionLocation);
             locationLayout.setVisibility(View.GONE);
         }
 
diff --git a/src/org/wordpress/android/util/CheckedLinearLayout.java b/src/org/wordpress/android/util/CheckedLinearLayout.java
new file mode 100644
index 000000000000..eaa21f37fab8
--- /dev/null
+++ b/src/org/wordpress/android/util/CheckedLinearLayout.java
@@ -0,0 +1,47 @@
+package org.wordpress.android.util;
+
+import android.content.Context;
+import android.util.AttributeSet;
+import android.view.View;
+import android.widget.Checkable;
+import android.widget.CheckedTextView;
+import android.widget.LinearLayout;
+
+public class CheckedLinearLayout extends LinearLayout implements Checkable {
+    private CheckedTextView mCheckbox;
+
+    public CheckedLinearLayout(Context context, AttributeSet attrs) {
+        super(context, attrs);
+    }
+
+    @Override
+    protected void onFinishInflate() {
+        super.onFinishInflate();
+        int childCount = getChildCount();
+        for (int i = 0; i < childCount; ++i) {
+            View v = getChildAt(i);
+            if (v instanceof CheckedTextView) {
+                mCheckbox = (CheckedTextView)v;
+            }
+        }
+    }
+
+    @Override
+    public boolean isChecked() {
+        return mCheckbox != null ? mCheckbox.isChecked() : false;
+    }
+
+    @Override
+    public void setChecked(boolean checked) {
+        if (mCheckbox != null) {
+            mCheckbox.setChecked(checked);
+        }
+    }
+
+    @Override
+    public void toggle() {
+        if (mCheckbox != null) {
+            mCheckbox.toggle();
+        }
+    }
+}
\ No newline at end of file
diff --git a/src/org/wordpress/android/util/FlowLayout.java b/src/org/wordpress/android/util/FlowLayout.java
new file mode 100644
index 000000000000..264dc9aae4aa
--- /dev/null
+++ b/src/org/wordpress/android/util/FlowLayout.java
@@ -0,0 +1,135 @@
+/*
+ * Sample FlowLayout wrote by Romain Guy: http://www.parleys.com/play/514892280364bc17fc56c0e2/chapter38/about
+ * Fixed and tweaked since
+ */
+
+package org.wordpress.android.util;
+
+import android.content.Context;
+import android.content.res.TypedArray;
+import android.graphics.Paint;
+import android.util.AttributeSet;
+import android.view.View;
+import android.view.ViewGroup;
+import org.wordpress.android.R;
+
+public class FlowLayout extends ViewGroup {
+	private int mHorizontalSpacing;
+	private int mVerticalSpacing;
+	private Paint mPaint;
+
+	public FlowLayout(Context context, AttributeSet attrs) {
+		super(context, attrs);
+        TypedArray a = context.obtainStyledAttributes(attrs, R.styleable.FlowLayout);
+		try {
+			mHorizontalSpacing = a.getDimensionPixelSize(R.styleable.FlowLayout_horizontalSpacing, 0);
+			mVerticalSpacing = a.getDimensionPixelSize(R.styleable.FlowLayout_verticalSpacing, 0);
+		} finally {
+			a.recycle();
+		}
+	}
+
+	@Override
+	protected void onMeasure(int widthMeasureSpec, int heightMeasureSpec) {
+		int widthSize = MeasureSpec.getSize(widthMeasureSpec) - getPaddingRight() - getPaddingLeft();
+		int widthMode = MeasureSpec.getMode(widthMeasureSpec);
+
+		boolean growHeight = widthMode != MeasureSpec.UNSPECIFIED;
+
+		int width = 0;
+		int height = getPaddingTop();
+
+		int currentWidth = getPaddingLeft();
+		int currentHeight = 0;
+
+		boolean newLine = false;
+		int spacing = 0;
+
+		final int count = getChildCount();
+		for (int i = 0; i < count; i++) {
+			View child = getChildAt(i);
+			measureChild(child, widthMeasureSpec, heightMeasureSpec);
+
+			LayoutParams lp = (LayoutParams) child.getLayoutParams();
+		    spacing = mHorizontalSpacing;
+			if (lp.horizontalSpacing >= 0) {
+				spacing = lp.horizontalSpacing;
+			}
+
+			if (growHeight && currentWidth + child.getMeasuredWidth() > widthSize) {
+				height += currentHeight + mVerticalSpacing;
+				currentHeight = 0;
+				width = Math.max(width, currentWidth - spacing);
+				currentWidth = getPaddingLeft();
+				newLine = true;
+			} else {
+				newLine = false;
+			}
+
+			lp.x = currentWidth;
+			lp.y = height;
+
+			currentWidth += child.getMeasuredWidth() + spacing;
+			currentHeight = Math.max(currentHeight, child.getMeasuredHeight());
+		}
+
+		if (!newLine) {
+			width = Math.max(width, currentWidth - spacing);
+        }
+		width += getPaddingRight();
+		height += currentHeight + getPaddingBottom();
+
+		setMeasuredDimension(resolveSize(width, widthMeasureSpec), resolveSize(height, heightMeasureSpec));
+	}
+
+	@Override
+	protected void onLayout(boolean changed, int l, int t, int r, int b) {
+		final int count = getChildCount();
+		for (int i = 0; i < count; i++) {
+			View child = getChildAt(i);
+			LayoutParams lp = (LayoutParams) child.getLayoutParams();
+			child.layout(lp.x, lp.y, lp.x + child.getMeasuredWidth(), lp.y + child.getMeasuredHeight());
+		}
+	}
+
+	@Override
+	protected boolean checkLayoutParams(ViewGroup.LayoutParams p) {
+		return p instanceof LayoutParams;
+	}
+
+	@Override
+	protected LayoutParams generateDefaultLayoutParams() {
+		return new LayoutParams(LayoutParams.WRAP_CONTENT, LayoutParams.WRAP_CONTENT);
+	}
+
+	@Override
+	public LayoutParams generateLayoutParams(AttributeSet attrs) {
+		return new LayoutParams(getContext(), attrs);
+	}
+	
+	@Override
+	protected LayoutParams generateLayoutParams(ViewGroup.LayoutParams p) {
+		return new LayoutParams(p.width, p.height);
+	}
+
+	public static class LayoutParams extends ViewGroup.LayoutParams {
+		int x;
+		int y;
+		
+		public int horizontalSpacing;
+
+		public LayoutParams(Context context, AttributeSet attrs) {
+			super(context, attrs);
+			TypedArray a = context.obtainStyledAttributes(attrs, R.styleable.FlowLayout_LayoutParams);
+			try {
+				horizontalSpacing = a.getDimensionPixelSize(R.styleable.FlowLayout_LayoutParams_layout_horizontalSpacing, -1);
+			} finally {
+				a.recycle();
+			}
+		}
+
+		public LayoutParams(int w, int h) {
+			super(w, h);
+		}
+	}
+}
diff --git a/src/org/wordpress/android/util/JSONUtil.java b/src/org/wordpress/android/util/JSONUtil.java
index 83e68a494269..009a54447c09 100644
--- a/src/org/wordpress/android/util/JSONUtil.java
+++ b/src/org/wordpress/android/util/JSONUtil.java
@@ -6,6 +6,9 @@
 import org.json.JSONArray;
 import org.json.JSONException;
 
+import java.util.ArrayList;
+import java.util.List;
+
 public class JSONUtil {
     private static String QUERY_SEPERATOR=".";
     private static String QUERY_ARRAY_INDEX_START="[";
@@ -124,4 +127,19 @@ public static <U> U queryJSON(JSONArray source, String query, U defaultObject){
         }
 
     }
+
+    /**
+     * Convert a JSONArray (expected to contain strings) in a string list
+     */
+    public static List<String> fromJSONArrayToStringList(JSONArray jsonArray) {
+        List<String> stringList = new ArrayList<String>();
+        for (int i = 0; i < jsonArray.length(); i++) {
+            try {
+                stringList.add(jsonArray.getString(i));
+            } catch (JSONException e) {
+                e.printStackTrace();
+            }
+        }
+        return stringList;
+    }
 }
\ No newline at end of file
diff --git a/src/org/wordpress/android/util/PostUploadService.java b/src/org/wordpress/android/util/PostUploadService.java
index cb15a5651f54..32c73b2d8cb5 100644
--- a/src/org/wordpress/android/util/PostUploadService.java
+++ b/src/org/wordpress/android/util/PostUploadService.java
@@ -253,7 +253,7 @@ protected Boolean doInBackground(Post... posts) {
             if (mediaError)
                 return false;
 
-            JSONArray categories = post.getCategories();
+            JSONArray categories = post.getJSONCategories();
             String[] theCategories = null;
             if (categories != null) {
                 theCategories = new String[categories.length()];