diff --git a/lib/parser.js b/lib/parser.js
index <HASH>..<HASH> 100644
--- a/lib/parser.js
+++ b/lib/parser.js
@@ -63,6 +63,17 @@ Parser.prototype = {
   advance: function(){
     return this.lexer.advance();
   },
+
+  /**
+   * Skip `n` tokens.
+   *
+   * @param {Number} n
+   * @api private
+   */
+
+  skip: function(n){
+    while (n--) this.advance();
+  },
   
   /**
    * Single token lookahead.
@@ -208,9 +219,14 @@ Parser.prototype = {
   
   parseCode: function(){
     var tok = this.expect('code')
-      , node = new nodes.Code(tok.val, tok.buffer, tok.escape);
+      , node = new nodes.Code(tok.val, tok.buffer, tok.escape)
+      , block
+      , i = 1;
     node.line = this.line();
-    if ('indent' == this.peek().type) {
+    while (this.lookahead(i) && 'newline' == this.lookahead(i).type) ++i;
+    block = 'indent' == this.lookahead(i).type;
+    if (block) {
+      this.skip(i-1);
       node.block = this.parseBlock();
     }
     return node;
Fixed code indentation when followed by newline(s). Closes #<I> [reported by masylum]