diff --git a/features/package-install.feature b/features/package-install.feature
index 7b74eb4f5b..5f0a0216cd 100644
--- a/features/package-install.feature
+++ b/features/package-install.feature
@@ -1,5 +1,9 @@
 Feature: Install WP-CLI packages
 
+  Background:
+    When I run `wp package path`
+    Then save STDOUT as {PACKAGE_PATH}
+
   Scenario: Install a package with an http package index url in package composer.json
     Given an empty directory
     And a composer.json file:
@@ -65,9 +69,6 @@ Feature: Install WP-CLI packages
   Scenario: Install a package with a dependency
     Given an empty directory
 
-    When I run `wp package path`
-    Then save STDOUT as {PACKAGE_PATH}
-
     When I run `wp package install trendwerk/faker`
     Then STDOUT should contain:
       """
@@ -123,9 +124,6 @@ Feature: Install WP-CLI packages
   Scenario: Install a package from a Git URL
     Given an empty directory
 
-    When I run `wp package path`
-    Then save STDOUT as {PACKAGE_PATH}
-
     When I try `wp package install git@github.com:wp-cli.git`
     Then STDERR should be:
       """
@@ -150,6 +148,105 @@ Feature: Install WP-CLI packages
       | name                                |
       | wp-cli/google-sitemap-generator-cli |
 
+    When I run `wp google-sitemap`
+    Then STDOUT should contain:
+      """
+      usage: wp google-sitemap rebuild
+      """
+
+    When I run `wp package uninstall wp-cli/google-sitemap-generator-cli`
+    Then STDOUT should contain:
+      """
+      Removing require statement from {PACKAGE_PATH}composer.json
+      """
+    And STDOUT should contain:
+      """
+      Success: Uninstalled package.
+      """
+
+    When I run `wp package list --fields=name`
+    Then STDOUT should not contain:
+      """
+      wp-cli/google-sitemap-generator-cli
+      """
+
+  Scenario: Install a package in a local zip
+    Given an empty directory
+    And I run `wget -O google-sitemap-generator-cli.zip https://github.com/wp-cli/google-sitemap-generator-cli/archive/master.zip`
+
+    When I run `wp package install google-sitemap-generator-cli.zip`
+    Then STDOUT should contain:
+      """
+      Installing package wp-cli/google-sitemap-generator-cli (dev-master)
+      Updating {PACKAGE_PATH}composer.json to require the package...
+      Registering {PACKAGE_PATH}local/wp-cli-google-sitemap-generator-cli as a path repository...
+      Using Composer to install the package...
+      """
+    And STDOUT should contain:
+      """
+      Success: Package installed successfully.
+      """
+
+    When I run `wp package list --fields=name`
+    Then STDOUT should be a table containing rows:
+      | name                                |
+      | wp-cli/google-sitemap-generator-cli |
+
+    When I run `wp google-sitemap`
+    Then STDOUT should contain:
+      """
+      usage: wp google-sitemap rebuild
+      """
+
+    When I run `wp package uninstall wp-cli/google-sitemap-generator-cli`
+    Then STDOUT should contain:
+      """
+      Removing require statement from {PACKAGE_PATH}composer.json
+      """
+    And STDOUT should contain:
+      """
+      Success: Uninstalled package.
+      """
+
+    When I run `wp package list --fields=name`
+    Then STDOUT should not contain:
+      """
+      wp-cli/google-sitemap-generator-cli
+      """
+
+  Scenario: Install a package from a remote ZIP
+    Given an empty directory
+
+    When I try `wp package install https://github.com/wp-cli/google-sitemap-generator.zip`
+    Then STDERR should be:
+      """
+      Error: Couldn't download package.
+      """
+
+    When I run `wp package install https://github.com/wp-cli/google-sitemap-generator-cli/archive/master.zip`
+    Then STDOUT should contain:
+      """
+      Installing package wp-cli/google-sitemap-generator-cli (dev-master)
+      Updating {PACKAGE_PATH}composer.json to require the package...
+      Registering {PACKAGE_PATH}local/wp-cli-google-sitemap-generator-cli as a path repository...
+      Using Composer to install the package...
+      """
+    And STDOUT should contain:
+      """
+      Success: Package installed successfully.
+      """
+
+    When I run `wp package list --fields=name`
+    Then STDOUT should be a table containing rows:
+      | name                                |
+      | wp-cli/google-sitemap-generator-cli |
+
+    When I run `wp google-sitemap`
+    Then STDOUT should contain:
+      """
+      usage: wp google-sitemap rebuild
+      """
+
     When I run `wp package uninstall wp-cli/google-sitemap-generator-cli`
     Then STDOUT should contain:
       """
@@ -193,9 +290,6 @@ Feature: Install WP-CLI packages
       }
       """
 
-    When I run `wp package path`
-    Then save STDOUT as {PACKAGE_PATH}
-
     When I run `pwd`
     Then save STDOUT as {CURRENT_PATH}
 
diff --git a/php/WP_CLI/Extractor.php b/php/WP_CLI/Extractor.php
new file mode 100644
index 0000000000..defdc51278
--- /dev/null
+++ b/php/WP_CLI/Extractor.php
@@ -0,0 +1,138 @@
+<?php
+
+namespace WP_CLI;
+
+use Exception;
+use PharData;
+use RecursiveDirectoryIterator;
+use RecursiveIteratorIterator;
+use WP_CLI;
+use WP_CLI\Utils;
+use ZipArchive;
+
+/**
+ * Extract a provided archive file.
+ */
+class Extractor {
+
+	/**
+	 * Extract the archive file to a specific destination.
+	 *
+	 * @param string $dest
+	 */
+	public static function extract( $tarball_or_zip, $dest ) {
+		if ( preg_match( '/\.zip$/', $tarball_or_zip ) ) {
+			return self::extract_zip( $tarball_or_zip, $dest );
+		}
+
+		if ( preg_match( '/\.tar\.gz$/', $tarball_or_zip ) ) {
+			return self::extract_tarball( $tarball_or_zip, $dest );
+		}
+		throw new \Exception( 'Extension not supported.' );
+	}
+
+	/**
+	 * Extract a ZIP file to a specific destination.
+	 *
+	 * @param string $zipfile
+	 * @param string $dest
+	 */
+	private static function extract_zip( $zipfile, $dest ) {
+		if ( ! class_exists( 'ZipArchive' ) ) {
+			throw new Exception( 'Extracting a zip file requires ZipArchive.' );
+		}
+		$zip = new ZipArchive();
+		$res = $zip->open( $zipfile );
+		if ( true === $res ) {
+			$tempdir = implode( DIRECTORY_SEPARATOR, Array (
+				dirname( $zipfile ),
+				basename( $zipfile, '.zip' ),
+				$zip->getNameIndex( 0 )
+			) );
+
+			$zip->extractTo( dirname( $tempdir ) );
+			$zip->close();
+
+			self::copy_overwrite_files( $tempdir, $dest );
+			self::rmdir( dirname( $tempdir ) );
+		} else {
+			throw Exception( $res );
+		}
+	}
+
+	/**
+	 * Extract a tarball to a specific destination.
+	 *
+	 * @param string $tarball
+	 * @param string $dest
+	 */
+	private static function extract_tarball( $tarball, $dest ) {
+		if ( ! class_exists( 'PharData' ) ) {
+			$cmd = "tar xz --strip-components=1 --directory=%s -f $tarball";
+			WP_CLI::launch( Utils\esc_cmd( $cmd, $dest ) );
+			return;
+		}
+		$phar = new PharData( $tarball );
+		$tempdir = implode( DIRECTORY_SEPARATOR, Array (
+			dirname( $tarball ),
+			basename( $tarball, '.tar.gz' ),
+			$phar->getFileName()
+		) );
+
+		$phar->extractTo( dirname( $tempdir ), null, true );
+
+		self::copy_overwrite_files( $tempdir, $dest );
+
+		self::rmdir( dirname( $tempdir ) );
+	}
+
+	public static function copy_overwrite_files( $source, $dest ) {
+		$iterator = new RecursiveIteratorIterator(
+			new RecursiveDirectoryIterator( $source, RecursiveDirectoryIterator::SKIP_DOTS ),
+			RecursiveIteratorIterator::SELF_FIRST);
+
+		$error = 0;
+
+		if ( ! is_dir( $dest ) ) {
+			mkdir( $dest, 0777, true );
+		}
+
+		foreach ( $iterator as $item ) {
+
+			$dest_path = $dest . DIRECTORY_SEPARATOR . $iterator->getSubPathName();
+
+			if ( $item->isDir() ) {
+				if ( !is_dir( $dest_path ) ) {
+					mkdir( $dest_path );
+				}
+			} else {
+				if ( file_exists( $dest_path ) && is_writable( $dest_path ) ) {
+					copy( $item, $dest_path );
+				} elseif ( ! file_exists( $dest_path ) ) {
+					copy( $item, $dest_path );
+				} else {
+					$error = 1;
+					WP_CLI::warning( "Unable to copy '" . $iterator->getSubPathName() . "' to current directory." );
+				}
+			}
+		}
+
+		if ( $error ) {
+			throw new Exception( 'There was an error overwriting existing files.' );
+		}
+	}
+
+	public static function rmdir( $dir ) {
+		$files = new RecursiveIteratorIterator(
+			new RecursiveDirectoryIterator( $dir, RecursiveDirectoryIterator::SKIP_DOTS ),
+			RecursiveIteratorIterator::CHILD_FIRST
+		);
+
+		foreach ( $files as $fileinfo ) {
+			$todo = $fileinfo->isDir() ? 'rmdir' : 'unlink';
+			$todo( $fileinfo->getRealPath() );
+		}
+		rmdir( $dir );
+	}
+
+}
diff --git a/php/commands/core.php b/php/commands/core.php
index 7e44795ea2..063c4e3ac8 100644
--- a/php/commands/core.php
+++ b/php/commands/core.php
@@ -1,6 +1,7 @@
 <?php
 
 use \Composer\Semver\Comparator;
+use \WP_CLI\Extractor;
 use \WP_CLI\Utils;
 
 /**
@@ -178,7 +179,7 @@ public function download( $args, $assoc_args ) {
 		if ( $cache_file ) {
 			WP_CLI::log( "Using cached file '$cache_file'..." );
 			try{
-				self::_extract( $cache_file, $download_dir );
+				Extractor::extract( $cache_file, $download_dir );
 			} catch ( Exception $e ) {
 				WP_CLI::warning( "Extraction failed, downloading a new copy..." );
 				$bad_cache = true;
@@ -221,7 +222,7 @@ public function download( $args, $assoc_args ) {
 			}
 
 			try {
-				self::_extract( $temp, $download_dir );
+				Extractor::extract( $temp, $download_dir );
 			} catch ( Exception $e ) {
 				WP_CLI::error( "Couldn't extract WordPress archive. " . $e->getMessage() );
 			}
@@ -239,108 +240,6 @@ public function download( $args, $assoc_args ) {
 		WP_CLI::success( 'WordPress downloaded.' );
 	}
 
-	private static function _extract( $tarball_or_zip, $dest ) {
-		$path_parts = pathinfo( $tarball_or_zip );
-
-		if ( preg_match( '/\.zip$/', $tarball_or_zip ) ) {
-			return self::_extract_zip( $tarball_or_zip, $dest );
-		}
-
-		if ( preg_match( '/\.tar\.gz$/', $tarball_or_zip ) ) {
-			return self::_extract_tarball( $tarball_or_zip, $dest );
-		}
-
-		WP_CLI::error( sprintf( 'Extension %s not supported.', $extension ) );
-	}
-
-	private static function _extract_tarball( $tarball, $dest ) {
-		if ( ! class_exists( 'PharData' ) ) {
-			$cmd = "tar xz --strip-components=1 --directory=%s -f $tarball";
-			WP_CLI::launch( Utils\esc_cmd( $cmd, $dest ) );
-			return;
-		}
-		$phar = new PharData( $tarball );
-		$tempdir = implode( DIRECTORY_SEPARATOR, Array (
-			dirname( $tarball ),
-			basename( $tarball, '.tar.gz' ),
-			$phar->getFileName()
-		) );
-
-		$phar->extractTo( dirname( $tempdir ), null, true );
-
-		self::_copy_overwrite_files( $tempdir, $dest );
-
-		self::_rmdir( dirname( $tempdir ) );
-	}
-
-	private static function _extract_zip( $zipfile, $dest ) {
-		if ( ! class_exists( 'ZipArchive' ) ) {
-			throw new \Exception( 'Extracting a zip file requires ZipArchive.' );
-		}
-		$zip = new ZipArchive();
-		$res = $zip->open( $zipfile );
-		if ( true === $res ) {
-			$tempdir = implode( DIRECTORY_SEPARATOR, Array (
-				dirname( $zipfile ),
-				basename( $zipfile, '.zip' ),
-				$zip->getNameIndex( 0 )
-			) );
-
-			$zip->extractTo( dirname( $tempdir ) );
-			$zip->close();
-
-			self::_copy_overwrite_files( $tempdir, $dest );
-			self::_rmdir( dirname( $tempdir ) );
-		} else {
-			throw \Exception( $res );
-		}
-	}
-
-	private static function _copy_overwrite_files( $source, $dest ) {
-		$iterator = new RecursiveIteratorIterator(
-			new RecursiveDirectoryIterator( $source, RecursiveDirectoryIterator::SKIP_DOTS ),
-			RecursiveIteratorIterator::SELF_FIRST);
-
-		$error = 0;
-
-		foreach ( $iterator as $item ) {
-
-			$dest_path = $dest . DIRECTORY_SEPARATOR . $iterator->getSubPathName();
-
-			if ( $item->isDir() ) {
-				if ( !is_dir( $dest_path ) ) {
-					mkdir( $dest_path );
-				}
-			} else {
-				if ( file_exists( $dest_path ) && is_writable( $dest_path ) ) {
-					copy( $item, $dest_path );
-				} elseif ( ! file_exists( $dest_path ) ) {
-					copy( $item, $dest_path );
-				} else {
-					$error = 1;
-					WP_CLI::warning( "Unable to copy '" . $iterator->getSubPathName() . "' to current directory." );
-				}
-			}
-		}
-
-		if ( $error ) {
-			WP_CLI::error( 'There was an error downloading all WordPress files.' );
-		}
-	}
-
-	private static function _rmdir( $dir ) {
-		$files = new RecursiveIteratorIterator(
-			new RecursiveDirectoryIterator( $dir, RecursiveDirectoryIterator::SKIP_DOTS ),
-			RecursiveIteratorIterator::CHILD_FIRST
-		);
-
-		foreach ( $files as $fileinfo ) {
-			$todo = $fileinfo->isDir() ? 'rmdir' : 'unlink';
-			$todo( $fileinfo->getRealPath() );
-		}
-		rmdir( $dir );
-	}
-
 	private static function _read( $url ) {
 		$headers = array('Accept' => 'application/json');
 		$response = Utils\http_request( 'GET', $url, null, $headers, array( 'timeout' => 30 ) );
diff --git a/php/commands/package.php b/php/commands/package.php
index 19bd5137e0..d4f31c300b 100644
--- a/php/commands/package.php
+++ b/php/commands/package.php
@@ -15,6 +15,7 @@
 use \Composer\Repository\RepositoryManager;
 use \Composer\Util\Filesystem;
 use \WP_CLI\ComposerIO;
+use \WP_CLI\Extractor;
 use \WP_CLI\Utils;
 
 /**
@@ -135,20 +136,25 @@ public function browse( $_, $assoc_args ) {
 	 * * Package name from WP-CLI's package index.
 	 * * Git URL accessible by the current shell user.
 	 * * Path to a directory on the local machine.
+	 * * Local or remote .zip file.
 	 *
-	 * Note: When installing a local directory, WP-CLI simply registers a
+	 * When installing a local directory, WP-CLI simply registers a
 	 * reference to the directory. If you move or delete the directory, WP-CLI's
 	 * reference breaks.
 	 *
+	 * When installing a .zip file, WP-CLI extracts the package to
+	 * `~/.wp-cli/packages/local/<package-name>`.
+	 *
 	 * ## OPTIONS
 	 *
-	 * <name|git|path>
-	 * : Name, git URL, or directory path for the package to install. Names can
-	 * optionally include a version constraint (e.g. wp-cli/server-command:@stable)
+	 * <name|git|path|zip>
+	 * : Name, git URL, directory path, or .zip file for the package to install.
+	 * Names can optionally include a version constraint
+	 * (e.g. wp-cli/server-command:@stable).
 	 *
 	 * ## EXAMPLES
 	 *
-	 *     # Install the latest development version from the package index
+	 *     # Install the latest development version from the package index.
 	 *     $ wp package install wp-cli/server-command
 	 *     Installing package wp-cli/server-command (dev-master)
 	 *     Updating /home/person/.wp-cli/packages/composer.json to require the package...
@@ -166,11 +172,14 @@ public function browse( $_, $assoc_args ) {
 	 *     ---
 	 *     Success: Package installed successfully.
 	 *
-	 *     # Install the latest stable version
+	 *     # Install the latest stable version.
 	 *     $ wp package install wp-cli/server-command:@stable
 	 *
-	 *     # Install a package hosted at a git URL
+	 *     # Install a package hosted at a git URL.
 	 *     $ wp package install git@github.com:runcommand/hook.git
+	 *
+	 *     # Install a package in a .zip file.
+	 *     $ wp package install google-sitemap-generator-cli.zip
 	 */
 	public function install( $args, $assoc_args ) {
 		list( $package_name ) = $args;
@@ -185,22 +194,42 @@ public function install( $args, $assoc_args ) {
 			} else {
 				WP_CLI::error( "Couldn't parse package name from expected path '<name>/<package>'." );
 			}
+		} else if ( ( false !== strpos( $package_name, '://' ) && false !== stripos( $package_name, '.zip' ) )
+			|| ( pathinfo( $package_name, PATHINFO_EXTENSION ) === 'zip' && is_file( $package_name ) ) ) {
+			// Download the remote ZIP file to a temp directory
+			if ( false !== strpos( $package_name, '://' ) ) {
+				$temp = Utils\get_temp_dir() . uniqid('package_') . ".zip";
+				$options = array(
+					'timeout' => 600,
+					'filename' => $temp
+				);
+				$response = Utils\http_request( 'GET', $package_name, null, array(), $options );
+				if ( 20 != substr( $response->status_code, 0, 2 ) ) {
+					WP_CLI::error( "Couldn't download package." );
+				}
+				$package_name = $temp;
+			}
+			$dir_package = Utils\get_temp_dir() . uniqid( 'package_' );
+			try {
+				// Extract the package to get the package name
+				Extractor::extract( $package_name, $dir_package );
+				$package_name = self::get_package_name_from_dir_package( $dir_package );
+				// Move to a location based on the package name
+				$local_dir = rtrim( WP_CLI::get_runner()->get_packages_dir_path(), '/' ) . '/local/';
+				$actual_dir_package = $local_dir . str_replace( '/', '-', $package_name );
+				Extractor::copy_overwrite_files( $dir_package, $actual_dir_package );
+				Extractor::rmdir( $dir_package );
+				// Behold, the extracted package
+				$dir_package = $actual_dir_package;
+			} catch ( Exception $e ) {
+				WP_CLI::error( $e->getMessage() );
+			}
 		} else if ( is_dir( $package_name ) && file_exists( $package_name . '/composer.json' ) ) {
 			$dir_package = $package_name;
 			if ( ! Utils\is_path_absolute( $dir_package ) ) {
 				$dir_package = getcwd() . DIRECTORY_SEPARATOR . $dir_package;
 			}
-			$composer_file = $dir_package . '/composer.json';
-			$package_name = '';
-			if ( file_exists( $composer_file ) ) {
-				$composer_data = json_decode( file_get_contents( $composer_file ), true );
-				if ( ! empty( $composer_data['name'] ) ) {
-					$package_name = $composer_data['name'];
-				}
-			}
-			if ( empty( $package_name ) ) {
-				WP_CLI::error( "Invalid package." );
-			}
+			$package_name = self::get_package_name_from_dir_package( $dir_package );
 		} else {
 			if ( false !== strpos( $package_name, ':' ) ) {
 				list( $package_name, $version ) = explode( ':', $package_name );
@@ -587,6 +616,27 @@ private function is_package_installed( $package_name ) {
 		}
 	}
 
+	/**
+	 * Get the name of the package from the composer.json in a directory path
+	 *
+	 * @param string $dir_package
+	 * @return string
+	 */
+	private static function get_package_name_from_dir_package( $dir_package ) {
+		$composer_file = $dir_package . '/composer.json';
+		$package_name = '';
+		if ( file_exists( $composer_file ) ) {
+			$composer_data = json_decode( file_get_contents( $composer_file ), true );
+			if ( ! empty( $composer_data['name'] ) ) {
+				$package_name = $composer_data['name'];
+			}
+		}
+		if ( empty( $package_name ) ) {
+			WP_CLI::error( "Invalid package." );
+		}
+		return $package_name;
+	}
+
 	/**
 	 * Get the composer.json object
 	 */