diff --git a/src/System.Management.Automation/engine/MshCmdlet.cs b/src/System.Management.Automation/engine/MshCmdlet.cs
index f421923527d..12979eaf956 100644
--- a/src/System.Management.Automation/engine/MshCmdlet.cs
+++ b/src/System.Management.Automation/engine/MshCmdlet.cs
@@ -356,6 +356,11 @@ public CommandInfo GetCommand(string commandName, CommandTypes type, object[] ar
         /// </summary>
         public System.EventHandler<CommandLookupEventArgs> PostCommandLookupAction { get; set; }
 
+        /// <summary>
+        /// Gets or sets the action that is invoked everytime the runspace location (cwd) is changed.
+        /// </summary>
+        public System.EventHandler<LocationChangedEventArgs> LocationChangedAction { get; set; }
+
         /// <summary>
         /// Returns the CmdletInfo object that corresponds to the name argument
         /// </summary>
diff --git a/src/System.Management.Automation/engine/SessionStateLocationAPIs.cs b/src/System.Management.Automation/engine/SessionStateLocationAPIs.cs
index 479186d9c62..2112f57767f 100644
--- a/src/System.Management.Automation/engine/SessionStateLocationAPIs.cs
+++ b/src/System.Management.Automation/engine/SessionStateLocationAPIs.cs
@@ -200,6 +200,7 @@ internal PathInfo SetLocation(string path, CmdletProviderContext context)
                 throw PSTraceSource.NewArgumentNullException("path");
             }
 
+            PathInfo current = CurrentLocation;
             string originalPath = path;
             string driveName = null;
             ProviderInfo provider = null;
@@ -553,6 +554,15 @@ internal PathInfo SetLocation(string path, CmdletProviderContext context)
             // Set the $PWD variable to the new location
 
             this.SetVariable(SpecialVariables.PWDVarPath, this.CurrentLocation, false, true, CommandOrigin.Internal);
+
+            // If an action has been defined for location changes, invoke it now.
+            if (PublicSessionState.InvokeCommand.LocationChangedAction != null)
+            {
+                var eventArgs = new LocationChangedEventArgs(PublicSessionState, current, CurrentLocation);
+                PublicSessionState.InvokeCommand.LocationChangedAction.Invoke(ExecutionContext.CurrentRunspace, eventArgs);
+                s_tracer.WriteLine("Invoked LocationChangedAction");
+            }
+
             return this.CurrentLocation;
         } // SetLocation
 
@@ -1046,5 +1056,47 @@ internal PathInfoStack SetDefaultLocationStack(string stackName)
 
         #endregion push-Pop current working directory
     }           // SessionStateInternal class
+
+    /// <summary>
+    /// Event argument for the LocationChangedAction containing
+    /// information about the old location we were in and the new
+    /// location we changed to.
+    /// </summary>
+    public class LocationChangedEventArgs : EventArgs
+    {
+        /// <summary>
+        /// Initializes a new instance of the LocationChangedEventArgs class.
+        /// </summary>
+        /// <param name="sessionState">
+        /// The public session state instance associated with this runspace.
+        /// </param>
+        /// <param name="oldPath">
+        /// The path we changed locations from.
+        /// </param>
+        /// <param name="newPath">
+        /// The path we change locations to.
+        /// </param>
+        internal LocationChangedEventArgs(SessionState sessionState, PathInfo oldPath, PathInfo newPath)
+        {
+            SessionState = sessionState;
+            OldPath = oldPath;
+            NewPath = newPath;
+        }
+
+        /// <summary>
+        /// Gets the path we changed location from.
+        /// </summary>
+        public PathInfo OldPath { get; internal set; }
+
+        /// <summary>
+        /// Gets the path we changed location to.
+        /// </summary>
+        public PathInfo NewPath { get; internal set; }
+
+        /// <summary>
+        /// Gets the session state instance for the current runspace.
+        /// </summary>
+        public SessionState SessionState { get; internal set; }
+    }
 }
 
diff --git a/test/powershell/Modules/Microsoft.PowerShell.Management/Set-Location.Tests.ps1 b/test/powershell/Modules/Microsoft.PowerShell.Management/Set-Location.Tests.ps1
index 95680dbe068..5ea2f278bc7 100644
--- a/test/powershell/Modules/Microsoft.PowerShell.Management/Set-Location.Tests.ps1
+++ b/test/powershell/Modules/Microsoft.PowerShell.Management/Set-Location.Tests.ps1
@@ -144,4 +144,40 @@ Describe "Set-Location" -Tags "CI" {
             { Set-Location - } | Should -Throw -ErrorId 'System.InvalidOperationException,Microsoft.PowerShell.Commands.SetLocationCommand'
         }
     }
+
+    Context 'Test the LocationChangedAction event handler' {
+
+        AfterEach {
+            $ExecutionContext.InvokeCommand.LocationChangedAction = $null
+        }
+
+        It 'The LocationChangedAction should fire when changing location' {
+            $initialPath = $pwd
+            $oldPath = $null
+            $newPath = $null
+            $eventSessionState = $null
+            $eventRunspace = $null
+            $ExecutionContext.InvokeCommand.LocationChangedAction = {
+                (Get-Variable eventRunspace).Value = $this
+                (Get-Variable eventSessionState).Value = $_.SessionState
+                (Get-Variable oldPath).Value = $_.oldPath
+                (Get-Variable newPath).Value = $_.newPath
+            }
+            Set-Location ..
+            $newPath.Path | Should -Be $pwd.Path
+            $oldPath.Path | Should -Be $initialPath.Path
+            $eventSessionState | Should -Be $ExecutionContext.SessionState
+            $eventRunspace | Should -Be ([runspace]::DefaultRunspace)
+        }
+
+        It 'Errors in the LocationChangedAction should be catchable but not fail the cd' {
+            $location = $PWD
+            Set-Location ..
+            $ExecutionContext.InvokeCommand.LocationChangedAction = { throw "Boom" }
+            # Verify that the exception occurred
+            { Set-Location $location } | Should Throw "Boom"
+            # But the location should still have changed
+            $PWD.Path | Should -Be $location.Path
+        }
+    }
 }