diff --git a/Makefile.am b/Makefile.am
index 7287eac9..e53e1181 100644
--- a/Makefile.am
+++ b/Makefile.am
@@ -1,6 +1,6 @@
 ACLOCAL_AMFLAGS = -I m4
 
-SUBDIRS = bin data lib po shell sugar services
+SUBDIRS = bin data lib po shell services
 
 bin_SCRIPTS = 			\
 	sugar-emulator
diff --git a/configure.ac b/configure.ac
index 11b70897..6eec5658 100644
--- a/configure.ac
+++ b/configure.ac
@@ -19,12 +19,7 @@ AC_PATH_PROG(PYGTK_CODEGEN, pygtk-codegen-2.0, no)
 
 PKG_CHECK_MODULES(SHELL, pygtk-2.0 gtk+-2.0)
 
-PKG_CHECK_MODULES(NATIVE_FACTORY, dbus-1)
-
-PKG_CHECK_MODULES(LIBUI, gtk+-2.0)
-PKG_CHECK_MODULES(LIBUI_BINDINGS, pygtk-2.0)
-
-PKG_CHECK_MODULES(LIB_BINDINGS, pygobject-2.0)
+PKG_CHECK_MODULES(LIB, pygtk-2.0 gtk+-2.0)
 
 PYGTK_DEFSDIR=`$PKG_CONFIG --variable=defsdir pygtk-2.0`
 AC_SUBST(PYGTK_DEFSDIR)
@@ -52,6 +47,14 @@ bin/Makefile
 data/Makefile
 data/icons/Makefile
 lib/Makefile
+lib/sugar/Makefile
+lib/sugar/activity/Makefile
+lib/sugar/bundle/Makefile
+lib/sugar/clipboard/Makefile
+lib/sugar/graphics/Makefile
+lib/sugar/objects/Makefile
+lib/sugar/presence/Makefile
+lib/sugar/datastore/Makefile
 services/Makefile
 services/shell/Makefile
 shell/Makefile
@@ -83,13 +86,5 @@ services/console/interface/network/Makefile
 services/console/interface/logviewer/Makefile
 services/console/interface/terminal/Makefile
 services/console/interface/xserver/Makefile
-sugar/Makefile
-sugar/activity/Makefile
-sugar/bundle/Makefile
-sugar/clipboard/Makefile
-sugar/graphics/Makefile
-sugar/objects/Makefile
-sugar/presence/Makefile
-sugar/datastore/Makefile
 po/Makefile.in
 ])
diff --git a/lib/Makefile.am b/lib/Makefile.am
index 5c432bed..4fa44db3 100644
--- a/lib/Makefile.am
+++ b/lib/Makefile.am
@@ -1,50 +1 @@
-libsugarui_la_CPPFLAGS =		\
-	$(LIBUI_CFLAGS)
-	
-noinst_LTLIBRARIES = libsugarui.la
-
-libsugarui_la_LIBADD = 			\
-	$(LIBUI_LIBS)
-
-libsugarui_la_SOURCES =			\
-	$(BUILT_SOURCES)		\
-	eggaccelerators.c		\
-	eggaccelerators.h		\
-	sexy-icon-entry.h		\
-	sexy-icon-entry.c		\
-	sugar-address-entry.c		\
-	sugar-address-entry.h		\
-	sugar-key-grabber.c		\
-	sugar-key-grabber.h		\
-	sugar-menu.h			\
-	sugar-menu.c			\
-	sugar-x11-util.c		\
-	sugar-x11-util.h
-
-BUILT_SOURCES = 		\
-	sugar-marshal.c		\
-	sugar-marshal.h
-
-stamp_files = 			\
-	stamp-sugar-marshal.c	\
-	stamp-sugar-marshal.h
-
-sugar-marshal.c: stamp-sugar-marshal.c
-	@true
-stamp-sugar-marshal.c: sugar-marshal.list
-	$(GLIB_GENMARSHAL) --prefix=sugar_marshal \
-		$(srcdir)/sugar-marshal.list --header --body > \
-		sugar-marshal.c && echo timestamp > $(@F)
-
-sugar-marshal.h: stamp-sugar-marshal.h
-	@true
-stamp-sugar-marshal.h: sugar-marshal.list
-	$(GLIB_GENMARSHAL) --prefix=sugar_marshal \
-		$(srcdir)/sugar-marshal.list --header > \
-		sugar-marshal.h && echo timestamp > $(@F)
-
-CLEANFILES = $(stamp_files) $(BUILT_SOURCES)
-DISTCLEANFILES = $(stamp_files) $(BUILT_SOURCES)
-MAINTAINERCLEANFILES = $(stamp_files) $(BUILT_SOURCES)
-
-EXTRA_DIST = sugar-marshal.list
+SUBDIRS = sugar
diff --git a/lib/sugar/.gitignore b/lib/sugar/.gitignore
new file mode 100644
index 00000000..f880b0ee
--- /dev/null
+++ b/lib/sugar/.gitignore
@@ -0,0 +1,2 @@
+_sugarext.c
+_sugarext.c
diff --git a/lib/.license b/lib/sugar/.license
similarity index 100%
rename from lib/.license
rename to lib/sugar/.license
diff --git a/lib/sugar/Makefile.am b/lib/sugar/Makefile.am
new file mode 100644
index 00000000..a88d23a1
--- /dev/null
+++ b/lib/sugar/Makefile.am
@@ -0,0 +1,74 @@
+SUBDIRS = activity bundle clipboard graphics objects presence datastore
+
+sugardir = $(pythondir)/sugar
+sugar_PYTHON =		\
+	env.py		\
+        network.py	\
+	profile.py	\
+	util.py		\
+	wm.py
+
+pkgpyexecdir = $(pythondir)/sugar
+
+pkgpyexec_LTLIBRARIES = _sugarext.la
+
+_sugarext_la_CFLAGS = 		\
+	$(LIB_CFLAGS)		\
+	$(PYTHON_INCLUDES)
+
+_sugarext_la_LDFLAGS = -module -avoid-version
+_sugarext_la_LIBADD = $(LIB_LIBS)
+
+_sugarext_la_SOURCES =			\
+	$(BUILT_SOURCES)		\
+	_sugarextmodule.c		\
+	eggaccelerators.c		\
+	eggaccelerators.h		\
+	sexy-icon-entry.h		\
+	sexy-icon-entry.c		\
+	sugar-address-entry.c		\
+	sugar-address-entry.h		\
+	sugar-key-grabber.c		\
+	sugar-key-grabber.h		\
+	sugar-menu.h			\
+	sugar-menu.c			\
+	sugar-x11-util.c		\
+	sugar-x11-util.h
+
+nodist__sugarext_la_SOURCES = 		\
+	_sugarext.c			\
+	sugar-marshal.c			\
+	sugar-marshal.h
+
+_sugarext.c: _sugarext.defs _sugarext.override
+
+.defs.c:
+	(cd $(srcdir)\
+	 && $(PYGTK_CODEGEN) \
+	    --register $(PYGTK_DEFSDIR)/gdk-types.defs \
+	    --register $(PYGTK_DEFSDIR)/gtk-types.defs \
+	    --override $*.override \
+	    --prefix py$* $*.defs) > gen-$*.c \
+	&& cp gen-$*.c $*.c \
+	&& rm -f gen-$*.c
+	
+stamp_files = 			\
+	stamp-sugar-marshal.c	\
+	stamp-sugar-marshal.h
+
+sugar-marshal.c: stamp-sugar-marshal.c
+	@true
+stamp-sugar-marshal.c: sugar-marshal.list
+	$(GLIB_GENMARSHAL) --prefix=sugar_marshal \
+		$(srcdir)/sugar-marshal.list --header --body > \
+		sugar-marshal.c && echo timestamp > $(@F)
+
+sugar-marshal.h: stamp-sugar-marshal.h
+	@true
+stamp-sugar-marshal.h: sugar-marshal.list
+	$(GLIB_GENMARSHAL) --prefix=sugar_marshal \
+		$(srcdir)/sugar-marshal.list --header > \
+		sugar-marshal.h && echo timestamp > $(@F)
+
+CLEANFILES = $(stamp_files)
+EXTRA_DIST = sugar-marshal.list _sugarext.defs _sugarext.override
diff --git a/sugar/_sugaruiext.defs b/lib/sugar/_sugarext.defs
similarity index 100%
rename from sugar/_sugaruiext.defs
rename to lib/sugar/_sugarext.defs
diff --git a/sugar/_sugaruiext.override b/lib/sugar/_sugarext.override
similarity index 100%
rename from sugar/_sugaruiext.override
rename to lib/sugar/_sugarext.override
diff --git a/sugar/_sugaruiextmodule.c b/lib/sugar/_sugarextmodule.c
similarity index 72%
rename from sugar/_sugaruiextmodule.c
rename to lib/sugar/_sugarextmodule.c
index 719b153b..6f6af6da 100644
--- a/sugar/_sugaruiextmodule.c
+++ b/lib/sugar/_sugarextmodule.c
@@ -24,25 +24,25 @@
 /* include this first, before NO_IMPORT_PYGOBJECT is defined */
 #include <pygobject.h>
 
-extern PyMethodDef py_sugaruiext_functions[];
+extern PyMethodDef py_sugarext_functions[];
 
-void py_sugaruiext_register_classes (PyObject *d);
-void py_sugaruiext_add_constants (PyObject *module, const gchar *strip_prefix);
+void py_sugarext_register_classes (PyObject *d);
+void py_sugarext_add_constants (PyObject *module, const gchar *strip_prefix);
 
 DL_EXPORT(void)
-init_sugaruiext(void)
+init_sugarext(void)
 {
     PyObject *m, *d;
 
     init_pygobject ();
 
-    m = Py_InitModule ("_sugaruiext", py_sugaruiext_functions);
+    m = Py_InitModule ("_sugarext", py_sugarext_functions);
     d = PyModule_GetDict (m);
 
-    py_sugaruiext_register_classes (d);
-    py_sugaruiext_add_constants(m, "SEXY_");
+    py_sugarext_register_classes (d);
+    py_sugarext_add_constants(m, "SEXY_");
 
     if (PyErr_Occurred ()) {
-        Py_FatalError ("can't initialise module _sugaruiext");
+        Py_FatalError ("can't initialise module _sugarext");
     }
 }
diff --git a/sugar/activity/Makefile.am b/lib/sugar/activity/Makefile.am
similarity index 100%
rename from sugar/activity/Makefile.am
rename to lib/sugar/activity/Makefile.am
diff --git a/sugar/activity/__init__.py b/lib/sugar/activity/__init__.py
similarity index 100%
rename from sugar/activity/__init__.py
rename to lib/sugar/activity/__init__.py
diff --git a/sugar/activity/__init__py b/lib/sugar/activity/__init__py
similarity index 100%
rename from sugar/activity/__init__py
rename to lib/sugar/activity/__init__py
diff --git a/sugar/activity/activity.py b/lib/sugar/activity/activity.py
similarity index 100%
rename from sugar/activity/activity.py
rename to lib/sugar/activity/activity.py
diff --git a/sugar/activity/activityfactory.py b/lib/sugar/activity/activityfactory.py
similarity index 100%
rename from sugar/activity/activityfactory.py
rename to lib/sugar/activity/activityfactory.py
diff --git a/sugar/activity/activityhandle.py b/lib/sugar/activity/activityhandle.py
similarity index 100%
rename from sugar/activity/activityhandle.py
rename to lib/sugar/activity/activityhandle.py
diff --git a/sugar/activity/activityservice.py b/lib/sugar/activity/activityservice.py
similarity index 100%
rename from sugar/activity/activityservice.py
rename to lib/sugar/activity/activityservice.py
diff --git a/sugar/activity/bundlebuilder.py b/lib/sugar/activity/bundlebuilder.py
similarity index 100%
rename from sugar/activity/bundlebuilder.py
rename to lib/sugar/activity/bundlebuilder.py
diff --git a/sugar/activity/registry.py b/lib/sugar/activity/registry.py
similarity index 100%
rename from sugar/activity/registry.py
rename to lib/sugar/activity/registry.py
diff --git a/sugar/bundle/Makefile.am b/lib/sugar/bundle/Makefile.am
similarity index 100%
rename from sugar/bundle/Makefile.am
rename to lib/sugar/bundle/Makefile.am
diff --git a/sugar/bundle/__init__.py b/lib/sugar/bundle/__init__.py
similarity index 100%
rename from sugar/bundle/__init__.py
rename to lib/sugar/bundle/__init__.py
diff --git a/sugar/bundle/activitybundle.py b/lib/sugar/bundle/activitybundle.py
similarity index 100%
rename from sugar/bundle/activitybundle.py
rename to lib/sugar/bundle/activitybundle.py
diff --git a/sugar/bundle/bundle.py b/lib/sugar/bundle/bundle.py
similarity index 100%
rename from sugar/bundle/bundle.py
rename to lib/sugar/bundle/bundle.py
diff --git a/sugar/bundle/contentbundle.py b/lib/sugar/bundle/contentbundle.py
similarity index 100%
rename from sugar/bundle/contentbundle.py
rename to lib/sugar/bundle/contentbundle.py
diff --git a/sugar/clipboard/Makefile.am b/lib/sugar/clipboard/Makefile.am
similarity index 100%
rename from sugar/clipboard/Makefile.am
rename to lib/sugar/clipboard/Makefile.am
diff --git a/sugar/clipboard/__init__.py b/lib/sugar/clipboard/__init__.py
similarity index 100%
rename from sugar/clipboard/__init__.py
rename to lib/sugar/clipboard/__init__.py
diff --git a/sugar/clipboard/clipboardservice.py b/lib/sugar/clipboard/clipboardservice.py
similarity index 100%
rename from sugar/clipboard/clipboardservice.py
rename to lib/sugar/clipboard/clipboardservice.py
diff --git a/sugar/datastore/Makefile.am b/lib/sugar/datastore/Makefile.am
similarity index 100%
rename from sugar/datastore/Makefile.am
rename to lib/sugar/datastore/Makefile.am
diff --git a/sugar/datastore/__init__.py b/lib/sugar/datastore/__init__.py
similarity index 100%
rename from sugar/datastore/__init__.py
rename to lib/sugar/datastore/__init__.py
diff --git a/sugar/datastore/datastore.py b/lib/sugar/datastore/datastore.py
similarity index 100%
rename from sugar/datastore/datastore.py
rename to lib/sugar/datastore/datastore.py
diff --git a/sugar/datastore/dbus_helpers.py b/lib/sugar/datastore/dbus_helpers.py
similarity index 100%
rename from sugar/datastore/dbus_helpers.py
rename to lib/sugar/datastore/dbus_helpers.py
diff --git a/lib/eggaccelerators.c b/lib/sugar/eggaccelerators.c
similarity index 100%
rename from lib/eggaccelerators.c
rename to lib/sugar/eggaccelerators.c
diff --git a/lib/eggaccelerators.h b/lib/sugar/eggaccelerators.h
similarity index 100%
rename from lib/eggaccelerators.h
rename to lib/sugar/eggaccelerators.h
diff --git a/sugar/env.py b/lib/sugar/env.py
similarity index 100%
rename from sugar/env.py
rename to lib/sugar/env.py
diff --git a/sugar/graphics/Makefile.am b/lib/sugar/graphics/Makefile.am
similarity index 100%
rename from sugar/graphics/Makefile.am
rename to lib/sugar/graphics/Makefile.am
diff --git a/sugar/graphics/__init__.py b/lib/sugar/graphics/__init__.py
similarity index 100%
rename from sugar/graphics/__init__.py
rename to lib/sugar/graphics/__init__.py
diff --git a/sugar/graphics/alert.py b/lib/sugar/graphics/alert.py
similarity index 100%
rename from sugar/graphics/alert.py
rename to lib/sugar/graphics/alert.py
diff --git a/sugar/graphics/animator.py b/lib/sugar/graphics/animator.py
similarity index 100%
rename from sugar/graphics/animator.py
rename to lib/sugar/graphics/animator.py
diff --git a/sugar/graphics/combobox.py b/lib/sugar/graphics/combobox.py
similarity index 100%
rename from sugar/graphics/combobox.py
rename to lib/sugar/graphics/combobox.py
diff --git a/sugar/graphics/entry.py b/lib/sugar/graphics/entry.py
similarity index 100%
rename from sugar/graphics/entry.py
rename to lib/sugar/graphics/entry.py
diff --git a/sugar/graphics/icon.py b/lib/sugar/graphics/icon.py
similarity index 100%
rename from sugar/graphics/icon.py
rename to lib/sugar/graphics/icon.py
diff --git a/sugar/graphics/iconentry.py b/lib/sugar/graphics/iconentry.py
similarity index 86%
rename from sugar/graphics/iconentry.py
rename to lib/sugar/graphics/iconentry.py
index 2f7584f4..83bc864a 100644
--- a/sugar/graphics/iconentry.py
+++ b/lib/sugar/graphics/iconentry.py
@@ -17,12 +17,12 @@
 
 import gtk
 
-from sugar import _sugaruiext
+from sugar import _sugarext
 
-ICON_ENTRY_PRIMARY = _sugaruiext.ICON_ENTRY_PRIMARY
-ICON_ENTRY_SECONDARY = _sugaruiext.ICON_ENTRY_SECONDARY
+ICON_ENTRY_PRIMARY = _sugarext.ICON_ENTRY_PRIMARY
+ICON_ENTRY_SECONDARY = _sugarext.ICON_ENTRY_SECONDARY
 
-class IconEntry(_sugaruiext.IconEntry):
+class IconEntry(_sugarext.IconEntry):
     def set_icon_from_name(self, position, name):
         icon_theme = gtk.icon_theme_get_default()
         icon_info = icon_theme.lookup_icon(name,
@@ -41,5 +41,5 @@ class IconEntry(_sugaruiext.IconEntry):
         if image.get_storage_type() not in [gtk.IMAGE_PIXBUF, gtk.IMAGE_STOCK]:
             raise ValueError('Image must have a storage type of pixbuf or ' +
                              'stock, not %r.' % image.get_storage_type())
-        _sugaruiext.IconEntry.set_icon(self, position, image)
+        _sugarext.IconEntry.set_icon(self, position, image)
 
diff --git a/sugar/graphics/menuitem.py b/lib/sugar/graphics/menuitem.py
similarity index 100%
rename from sugar/graphics/menuitem.py
rename to lib/sugar/graphics/menuitem.py
diff --git a/sugar/graphics/notebook.py b/lib/sugar/graphics/notebook.py
similarity index 100%
rename from sugar/graphics/notebook.py
rename to lib/sugar/graphics/notebook.py
diff --git a/sugar/graphics/objectchooser.py b/lib/sugar/graphics/objectchooser.py
similarity index 100%
rename from sugar/graphics/objectchooser.py
rename to lib/sugar/graphics/objectchooser.py
diff --git a/sugar/graphics/palette.py b/lib/sugar/graphics/palette.py
similarity index 99%
rename from sugar/graphics/palette.py
rename to lib/sugar/graphics/palette.py
index 70cf4534..b3371331 100644
--- a/sugar/graphics/palette.py
+++ b/lib/sugar/graphics/palette.py
@@ -25,7 +25,7 @@ import hippo
 from sugar.graphics import palettegroup
 from sugar.graphics import animator
 from sugar.graphics import style
-from sugar import _sugaruiext
+from sugar import _sugarext
 
 # Helper function to find the gap position and size of widget a
 def _calculate_gap(a, b):
@@ -435,15 +435,15 @@ class PaletteActionBar(gtk.HButtonBox):
         self.pack_start(button)
         button.show()
 
-class _Menu(_sugaruiext.Menu):
+class _Menu(_sugarext.Menu):
     __gtype_name__ = 'SugarPaletteMenu'
 
     def __init__(self, palette):
-        _sugaruiext.Menu.__init__(self)
+        _sugarext.Menu.__init__(self)
         self._palette = palette
 
     def do_insert(self, item, position):
-        _sugaruiext.Menu.do_insert(self, item, position)
+        _sugarext.Menu.do_insert(self, item, position)
         self._palette._update_separators()
         self.show()
 
diff --git a/sugar/graphics/palettegroup.py b/lib/sugar/graphics/palettegroup.py
similarity index 100%
rename from sugar/graphics/palettegroup.py
rename to lib/sugar/graphics/palettegroup.py
diff --git a/sugar/graphics/panel.py b/lib/sugar/graphics/panel.py
similarity index 100%
rename from sugar/graphics/panel.py
rename to lib/sugar/graphics/panel.py
diff --git a/sugar/graphics/radiotoolbutton.py b/lib/sugar/graphics/radiotoolbutton.py
similarity index 100%
rename from sugar/graphics/radiotoolbutton.py
rename to lib/sugar/graphics/radiotoolbutton.py
diff --git a/sugar/graphics/roundbox.py b/lib/sugar/graphics/roundbox.py
similarity index 100%
rename from sugar/graphics/roundbox.py
rename to lib/sugar/graphics/roundbox.py
diff --git a/sugar/graphics/spreadlayout.py b/lib/sugar/graphics/spreadlayout.py
similarity index 100%
rename from sugar/graphics/spreadlayout.py
rename to lib/sugar/graphics/spreadlayout.py
diff --git a/sugar/graphics/style.py b/lib/sugar/graphics/style.py
similarity index 100%
rename from sugar/graphics/style.py
rename to lib/sugar/graphics/style.py
diff --git a/sugar/graphics/toggletoolbutton.py b/lib/sugar/graphics/toggletoolbutton.py
similarity index 100%
rename from sugar/graphics/toggletoolbutton.py
rename to lib/sugar/graphics/toggletoolbutton.py
diff --git a/sugar/graphics/toolbox.py b/lib/sugar/graphics/toolbox.py
similarity index 100%
rename from sugar/graphics/toolbox.py
rename to lib/sugar/graphics/toolbox.py
diff --git a/sugar/graphics/toolbutton.py b/lib/sugar/graphics/toolbutton.py
similarity index 100%
rename from sugar/graphics/toolbutton.py
rename to lib/sugar/graphics/toolbutton.py
diff --git a/sugar/graphics/toolcombobox.py b/lib/sugar/graphics/toolcombobox.py
similarity index 100%
rename from sugar/graphics/toolcombobox.py
rename to lib/sugar/graphics/toolcombobox.py
diff --git a/sugar/graphics/tray.py b/lib/sugar/graphics/tray.py
similarity index 100%
rename from sugar/graphics/tray.py
rename to lib/sugar/graphics/tray.py
diff --git a/sugar/graphics/window.py b/lib/sugar/graphics/window.py
similarity index 100%
rename from sugar/graphics/window.py
rename to lib/sugar/graphics/window.py
diff --git a/sugar/graphics/xocolor.py b/lib/sugar/graphics/xocolor.py
similarity index 100%
rename from sugar/graphics/xocolor.py
rename to lib/sugar/graphics/xocolor.py
diff --git a/sugar/network.py b/lib/sugar/network.py
similarity index 100%
rename from sugar/network.py
rename to lib/sugar/network.py
diff --git a/sugar/objects/Makefile.am b/lib/sugar/objects/Makefile.am
similarity index 100%
rename from sugar/objects/Makefile.am
rename to lib/sugar/objects/Makefile.am
diff --git a/sugar/objects/__init__.py b/lib/sugar/objects/__init__.py
similarity index 100%
rename from sugar/objects/__init__.py
rename to lib/sugar/objects/__init__.py
diff --git a/sugar/objects/objecttype.py b/lib/sugar/objects/objecttype.py
similarity index 100%
rename from sugar/objects/objecttype.py
rename to lib/sugar/objects/objecttype.py
diff --git a/sugar/presence/Makefile.am b/lib/sugar/presence/Makefile.am
similarity index 100%
rename from sugar/presence/Makefile.am
rename to lib/sugar/presence/Makefile.am
diff --git a/sugar/presence/__init__.py b/lib/sugar/presence/__init__.py
similarity index 100%
rename from sugar/presence/__init__.py
rename to lib/sugar/presence/__init__.py
diff --git a/sugar/presence/activity.py b/lib/sugar/presence/activity.py
similarity index 100%
rename from sugar/presence/activity.py
rename to lib/sugar/presence/activity.py
diff --git a/sugar/presence/buddy.py b/lib/sugar/presence/buddy.py
similarity index 100%
rename from sugar/presence/buddy.py
rename to lib/sugar/presence/buddy.py
diff --git a/sugar/presence/presenceservice.py b/lib/sugar/presence/presenceservice.py
similarity index 100%
rename from sugar/presence/presenceservice.py
rename to lib/sugar/presence/presenceservice.py
diff --git a/sugar/presence/test_presence.txt b/lib/sugar/presence/test_presence.txt
similarity index 100%
rename from sugar/presence/test_presence.txt
rename to lib/sugar/presence/test_presence.txt
diff --git a/sugar/presence/tubeconn.py b/lib/sugar/presence/tubeconn.py
similarity index 100%
rename from sugar/presence/tubeconn.py
rename to lib/sugar/presence/tubeconn.py
diff --git a/sugar/profile.py b/lib/sugar/profile.py
similarity index 100%
rename from sugar/profile.py
rename to lib/sugar/profile.py
diff --git a/lib/sexy-icon-entry.c b/lib/sugar/sexy-icon-entry.c
similarity index 100%
rename from lib/sexy-icon-entry.c
rename to lib/sugar/sexy-icon-entry.c
diff --git a/lib/sexy-icon-entry.h b/lib/sugar/sexy-icon-entry.h
similarity index 100%
rename from lib/sexy-icon-entry.h
rename to lib/sugar/sexy-icon-entry.h
diff --git a/lib/sugar-address-entry.c b/lib/sugar/sugar-address-entry.c
similarity index 100%
rename from lib/sugar-address-entry.c
rename to lib/sugar/sugar-address-entry.c
diff --git a/lib/sugar-address-entry.h b/lib/sugar/sugar-address-entry.h
similarity index 100%
rename from lib/sugar-address-entry.h
rename to lib/sugar/sugar-address-entry.h
diff --git a/lib/sugar-key-grabber.c b/lib/sugar/sugar-key-grabber.c
similarity index 100%
rename from lib/sugar-key-grabber.c
rename to lib/sugar/sugar-key-grabber.c
diff --git a/lib/sugar-key-grabber.h b/lib/sugar/sugar-key-grabber.h
similarity index 100%
rename from lib/sugar-key-grabber.h
rename to lib/sugar/sugar-key-grabber.h
diff --git a/lib/sugar-marshal.list b/lib/sugar/sugar-marshal.list
similarity index 100%
rename from lib/sugar-marshal.list
rename to lib/sugar/sugar-marshal.list
diff --git a/lib/sugar-menu.c b/lib/sugar/sugar-menu.c
similarity index 100%
rename from lib/sugar-menu.c
rename to lib/sugar/sugar-menu.c
diff --git a/lib/sugar-menu.h b/lib/sugar/sugar-menu.h
similarity index 100%
rename from lib/sugar-menu.h
rename to lib/sugar/sugar-menu.h
diff --git a/lib/sugar-x11-util.c b/lib/sugar/sugar-x11-util.c
similarity index 100%
rename from lib/sugar-x11-util.c
rename to lib/sugar/sugar-x11-util.c
diff --git a/lib/sugar-x11-util.h b/lib/sugar/sugar-x11-util.h
similarity index 100%
rename from lib/sugar-x11-util.h
rename to lib/sugar/sugar-x11-util.h
diff --git a/sugar/util.py b/lib/sugar/util.py
similarity index 100%
rename from sugar/util.py
rename to lib/sugar/util.py
diff --git a/sugar/wm.py b/lib/sugar/wm.py
similarity index 86%
rename from sugar/wm.py
rename to lib/sugar/wm.py
index 999e07a0..66108891 100644
--- a/sugar/wm.py
+++ b/lib/sugar/wm.py
@@ -17,22 +17,22 @@
 
 import gtk
 
-import _sugaruiext
+import _sugarext
 
 def get_activity_id(wnck_window):
     window = gtk.gdk.window_foreign_new(wnck_window.get_xid())
-    return _sugaruiext.x11_get_string_property(
+    return _sugarext.x11_get_string_property(
                             window, '_SUGAR_ACTIVITY_ID')
 
 def get_bundle_id(wnck_window):
     window = gtk.gdk.window_foreign_new(wnck_window.get_xid())
-    return _sugaruiext.x11_get_string_property(
+    return _sugarext.x11_get_string_property(
                             window, '_SUGAR_BUNDLE_ID')
 
 def set_activity_id(window, activity_id):
-    _sugaruiext.x11_set_string_property(
+    _sugarext.x11_set_string_property(
             window, '_SUGAR_ACTIVITY_ID', activity_id)
 
 def set_bundle_id(window, bundle_id):
-    _sugaruiext.x11_set_string_property(
+    _sugarext.x11_set_string_property(
             window, '_SUGAR_BUNDLE_ID', bundle_id)
diff --git a/shell/view/keyhandler.py b/shell/view/keyhandler.py
index a463a759..6a8fb9b5 100644
--- a/shell/view/keyhandler.py
+++ b/shell/view/keyhandler.py
@@ -24,7 +24,7 @@ import gtk
 
 from hardware import hardwaremanager
 from model.shellmodel import ShellModel
-from sugar._sugaruiext import KeyGrabber
+from sugar._sugarext import KeyGrabber
 
 _BRIGHTNESS_STEP = 2
 _VOLUME_STEP = 10
diff --git a/sugar/.gitignore b/sugar/.gitignore
deleted file mode 100644
index 191b96c9..00000000
--- a/sugar/.gitignore
+++ /dev/null
@@ -1,2 +0,0 @@
-_sugarext.c
-_sugaruiext.c
diff --git a/sugar/.license b/sugar/.license
deleted file mode 100644
index 6989ebe7..00000000
--- a/sugar/.license
+++ /dev/null
@@ -1 +0,0 @@
-LGPL
diff --git a/sugar/Makefile.am b/sugar/Makefile.am
deleted file mode 100644
index 0f5da849..00000000
--- a/sugar/Makefile.am
+++ /dev/null
@@ -1,48 +0,0 @@
-SUBDIRS = activity bundle clipboard graphics objects presence datastore
-
-sugardir = $(pythondir)/sugar
-sugar_PYTHON =		\
-	env.py		\
-        network.py	\
-	profile.py	\
-	util.py		\
-	wm.py
-
-pkgpyexecdir = $(pythondir)/sugar
-
-pkgpyexec_LTLIBRARIES = _sugaruiext.la
-
-_sugaruiext_la_CFLAGS = 		\
-	$(LIBUI_CFLAGS)			\
-	$(LIBUI_BINDINGS_CFLAGS)	\
-	$(PYTHON_INCLUDES)		\
-	-I$(top_srcdir)/lib
-
-_sugaruiext_la_LDFLAGS = -module -avoid-version
-_sugaruiext_la_LIBADD =				\
-	$(LIBUI_BINDINGS_LIBS)			\
-	$(LIBUI_LIBS)				\
-	$(top_builddir)/lib/libsugarui.la
-
-_sugaruiext_la_SOURCES = 		\
-	_sugaruiextmodule.c
-
-nodist__sugaruiext_la_SOURCES = _sugaruiext.c
-
-_sugaruiext.c: _sugaruiext.defs _sugaruiext.override
-
-CLEANFILES = _sugaruiext.c
-
-EXTRA_DIST =			\
-	_sugaruiext.defs	\
-	_sugaruiext.override
-
-.defs.c:
-	(cd $(srcdir)\
-	 && $(PYGTK_CODEGEN) \
-	    --register $(PYGTK_DEFSDIR)/gdk-types.defs \
-	    --register $(PYGTK_DEFSDIR)/gtk-types.defs \
-	    --override $*.override \
-	    --prefix py$* $*.defs) > gen-$*.c \
-	&& cp gen-$*.c $*.c \
-	&& rm -f gen-$*.c