diff --git a/pep-0000.txt b/pep-0000.txt
index ecf6876b4..f0011c343 100644
--- a/pep-0000.txt
+++ b/pep-0000.txt
@@ -124,6 +124,7 @@ Index by Category
  S   335  Overloadable Boolean Operators               Ewing
  S   336  Make None Callable                           McClelland
  S   337  Logging Usage in the Standard Library        Dubner
+ S   338  Executing modules inside packages with '-m'  Coghlan
  S   754  IEEE 754 Floating Point Special Values       Warnes
 
  Finished PEPs (done, implemented in CVS)
@@ -370,6 +371,7 @@ Numerical Index
  S   335  Overloadable Boolean Operators               Ewing
  S   336  Make None Callable                           McClelland
  S   337  Logging Usage in the Standard Library        Dubner
+ S   338  Executing modules inside packages with '-m'  Coghlan
  SR  666  Reject Foolish Indentation                   Creighton
  S   754  IEEE 754 Floating Point Special Values       Warnes
  I  3000  Python 3.0 Plans                             Kuchling, Cannon
@@ -402,6 +404,7 @@ Owners
     Cannon, Brett            drifty@alum.berkeley.edu
     Carlson, Josiah          jcarlson@uci.edu
     Carroll, W Isaac         icarroll@pobox.com
+    Coghlan, Nick            ncoghlan@email.com
     Cole, Dave               djc@object-craft.com.au
     Craig, Christopher       python-pep@ccraig.org
     Creighton, Laura         lac@strakt.com
diff --git a/pep-0338.txt b/pep-0338.txt
new file mode 100644
index 000000000..48d56630d
--- /dev/null
+++ b/pep-0338.txt
@@ -0,0 +1,195 @@
+PEP: 338
+Title: Executing modules inside packages with '-m'
+Version: $Revision$
+Last-Modified: $Date$
+Author: Nick Coghlan <ncoghlan@email.com>
+Status: Draft
+Type: Standards Track
+Content-Type: text/x-rst
+Created: 16-Oct-2004
+Python-Version: 2.5
+Post-History: 8-Nov-2004
+
+
+Abstract
+========
+
+This PEP defines semantics for executing modules inside packages as
+scripts with the ``-m`` command line switch.
+
+The proposed semantics are that the containing package be imported
+prior to execution of the script.
+
+
+Rationale
+=========
+
+Python 2.4 adds the command line switch ``-m`` to allow modules to be
+located using the Python module namespace for execution as scripts.
+The motivating examples were standard library modules such as ``pdb``
+and ``profile``.
+
+A number of users and developers have requested extension of the
+feature to also support running modules located inside packages.  One
+example provided is pychecker's ``pychecker.checker`` module.  This
+capability was left out of the Python 2.4 implementation because the
+appropriate semantics were not entirely clear.
+
+The opinion on python-dev was that it was better to postpone the
+extension to Python 2.5, and go through the PEP process to help make
+sure we got it right.
+
+
+Scope of this proposal
+==========================
+
+In Python 2.4, a module located using ``-m`` is executed just as if
+its filename had been provided on the command line.  The goal of this
+PEP is to get as close as possible to making that statement also hold
+true for modules inside packages.
+
+Prior discussions suggest it should be noted that this PEP is **not**
+about any of the following:
+
+- changing the idiom for making Python modules also useful as scripts
+  (see PEP 299 [1]_).
+
+- lifting the restriction of ``-m`` to modules of type PY_SOURCE or
+  PY_COMPILED (i.e. ``.py``, ``.pyc``, ``.pyo``,``.pyw``).
+
+- addressing the problem of ``-m`` not understanding zip imports or
+  Python's sys.metapath.
+
+The issues listed above are considered orthogonal to the specific
+feature addressed by this PEP.
+
+
+Current Behaviour
+=================
+
+Before describing the new semantics, it's worth covering the existing
+semantics for Python 2.4 (as they are currently defined only by the
+source code).
+
+When ``-m`` is used on the command line, it immediately terminates the
+option list (like ``-c``).  The argument is interpreted as the name of
+a top-level Python module (i.e. one which can be found on
+``sys.path``).
+
+If the module is found, and is of type ``PY_SOURCE`` or
+``PY_COMPILED``, then the command line is effectively reinterpreted
+from ``python <options> -m <module> <args>`` to ``python <options>
+<filename> <args>``.  This includes setting ``sys.argv[0]`` correctly
+(some scripts rely on this - Python's own ``regrtest.py`` is one
+example).
+
+If the module is not found, or is not of the correct type, an error
+is printed.
+
+
+Proposed Semantics
+==================
+
+The semantics proposed are fairly simple: if ``-m`` is used to execute
+a module inside a package as a script, then the containing package is
+imported before executing the module in accordance with the semantics
+for a top-level module.
+
+This is necessary due to the way Python's import machinery locates
+modules inside packages.  A package may modify its own __path__
+variable during initialisation.  In addition, paths may affected by
+``*.pth`` files.  Accordingly, the only way for Python to reliably
+locate the module is by importing the containing package and
+inspecting its __path__ variable.
+
+Note that the package is *not* imported into the ``__main__`` module's
+namespace.  The effects of these semantics that will be visible to the
+executed module are:
+
+- the containing package will be in sys.modules
+
+- any external effects of the package initialisation (e.g. installed
+  import hooks, loggers, atexit handlers, etc.)
+
+
+Reference Implementation
+========================
+
+A reference implementation is available on SourceForge [2]_.  In this
+implementation, if the ``-m`` switch fails to locate the requested
+module at the top level, it effectively reinterprets the command from
+``python -m <script>`` to ``python -m execmodule <script>``.  (There
+is one caveat: when reinterpreted in this way, ``sys.argv[0]`` may not
+actually contain the filename of ``execmodule``.  This only affects
+``execmodule`` itself, not the requested module).
+
+``execmodule`` is a proposed standard library module that contains a
+single function (also called ``execmodule``).  When invoked as a
+script, this module finds and executes the module supplied as the
+first argument.  It adjusts ``sys.argv`` by deleting ``sys.argv[0]``
+and replacing the new ``sys.argv[0]`` with the module's filename
+instead of its Python name.
+
+The function ``execmodule`` is like ``execfile``, but uses the Python
+module namespace to locate the script instead of the filesystem.  It
+has an additional optional argument ``set_argv0`` which causes the
+filename of the located module to be written to ``sys.argv[0]`` before
+the module is executed.
+
+A hybrid C/Python implementation is used as the Python module is much
+more flexible and extensible than the equivalent C code would be.  It
+also allows the ``execmodule`` function to be made available.  Scripts
+which execute other scripts (e.g. ``profile``, ``pdb``) have the
+option to use this function to provide ``-m`` style support for
+identifying the script to be executed.
+
+The Python code for ``execmodule`` has also been posted as a
+cookbook recipe for Python 2.4 [3]_.
+
+
+Open Issues
+===========
+
+- choosing a name for the standard library module containing
+  ``execmodule``.  The reference implementation uses ``execmodule``.
+  An alternative name proposed on python-dev is ``runpy``.
+
+
+Alternatives
+============
+
+The main alternative implementation considered ignored packages'
+__path__ variables, and looked only in the main package directory.  A
+Python script with this behaviour can be found in the discussion of
+the ``execmodule`` cookbook recipe [3]_.
+
+This approach was not used as it does not meet the main goal of the
+``-m`` switch -- to allow the full Python namespace to be used to
+locate modules for execution.
+
+
+References
+==========
+
+.. [1] Special __main__() function in modules
+   (http://www.python.org/peps/pep-0299.html)
+
+.. [2] Native ``-m`` execmodule support
+   (http://sourceforge.net/tracker/?func=detail&aid=1043356&group_id=5470&atid=305470 )
+
+.. [3] execmodule Python Cookbook Recipe
+   (http://aspn.activestate.com/ASPN/Cookbook/Python/Recipe/307772)
+
+
+Copyright
+=========
+
+This document has been placed in the public domain.
+
+..
+   Local Variables:
+   mode: indented-text
+   indent-tabs-mode: nil
+   sentence-end-double-space: t
+   fill-column: 70
+   End: