diff --git a/client/garageserver.io.js b/client/garageserver.io.js
index 8bef297..2ae7381 100644
--- a/client/garageserver.io.js
+++ b/client/garageserver.io.js
@@ -24,6 +24,7 @@ window.GarageServerIO = (function (window, socketio) {
         updates = [],
         options = null,
         pingDelay = 100,
+        serverOffset,
 
         // TODO: DONE CALLBACK
         connectToGarageServer = function (path, opts) {
@@ -41,9 +42,10 @@ window.GarageServerIO = (function (window, socketio) {
                 }
             });
             socket.on('ping', function(data) {
-                pingDelay = new Date().getTime() - data;
+                pingDelay = new Date().getTime() - data.pingTime;
+                serverOffset = new Date().getTime() - data.serverTime + pingDelay;
                 if (options.logging) {
-                    console.log('garageserver.io:: socket ping delay ' + pingDelay);
+                    console.log('garageserver.io:: socket ping delay ' + pingDelay + ', server offset ' + serverOffset);
                 }
             });
             socket.on('removePlayer', function(id) {
@@ -108,7 +110,7 @@ window.GarageServerIO = (function (window, socketio) {
                             }
                         }
                         if (!updateFound) {
-                            players[playerIdx].updates.push({ state: data.state, seq: data.seq });
+                            players[playerIdx].updates.push({ state: data.state, seq: data.seq, timestamp: data.timestamp });
                         }
                         break;
                     }
@@ -168,16 +170,24 @@ window.GarageServerIO = (function (window, socketio) {
         },
 
         sendPlayerInput = function (clientInput) {
-            var currentTime = new Date().getTime();
-            socket.emit('input', { input: clientInput, seq: sequenceNumber, timestamp: currentTime });
+            socket.emit('input', { input: clientInput, seq: sequenceNumber });
         },
 
         getPlayerStates = function (stateCallback) {
             var maxUpdate = 0;
-            for (var i = 0; i < players.length; i ++) {
-                if (players[i].updates.length > 0) {
-                    maxUpdate = players[i].updates.length - 1;
-                    stateCallback(players[i].updates[maxUpdate].state);
+            for (var playerIdx = 0; playerIdx < players.length; playerIdx ++) {
+                if (players[playerIdx].updates.length > 0) {
+                    if (options.interpolation) {
+                        for (var updateIdx = players[playerIdx].updates.length - 1; updateIdx >= 0; updateIdx --) {
+                            if (players[playerIdx].updates[updateIdx].timestamp >  (new Date().getTime() - serverOffset)) {
+                                stateCallback(players[playerIdx].updates[updateIdx].state);
+                                break;
+                            }
+                        }
+                    } else {
+                        maxUpdate = players[playerIdx].updates.length - 1;
+                        stateCallback(players[playerIdx].updates[maxUpdate].state);
+                    }
                 }
             }
             if (updates.length > 0) {
diff --git a/example/public/javascripts/game.js b/example/public/javascripts/game.js
index 2ef3c2b..e6683db 100644
--- a/example/public/javascripts/game.js
+++ b/example/public/javascripts/game.js
@@ -2,6 +2,7 @@ $(function () {
     GarageServerIO.connectToGarageServer('http://garageserver_io.jbillmann.c9.io', { 
         logging: true,
         clientSidePrediction: true,
+        interpolation: true,
         onUpdatePhysics: function (state, inputs) {
             var i = 0;
             if (!state.x && !state.y) {
diff --git a/lib/server/garageserver.io.js b/lib/server/garageserver.io.js
index db62494..d52c3d3 100644
--- a/lib/server/garageserver.io.js
+++ b/lib/server/garageserver.io.js
@@ -74,7 +74,7 @@ GarageServer.prototype.onPlayerInput = function (socket, input, options) {
 };
 
 GarageServer.prototype.onPing = function (socket, data, options) {
-    socket.emit('ping', data);
+    socket.emit('ping', { 'pingTime': data, 'serverTime': new Date().getTime() });
     if (options.onPing) {
         options.onPing(socket, data);
     }