diff --git a/config/config.go b/config/config.go
index 431807c06..e0733081f 100644
--- a/config/config.go
+++ b/config/config.go
@@ -110,7 +110,7 @@ func ProviderConfigName(t string, pcs []*ProviderConfig) string {
 
 // A unique identifier for this module.
 func (r *Module) Id() string {
-	return fmt.Sprintf("module.%s", r.Name)
+	return fmt.Sprintf("%s", r.Name)
 }
 
 // A unique identifier for this resource.
@@ -195,6 +195,24 @@ func (c *Config) Validate() error {
 	}
 	dupped = nil
 
+	// Check that all variables for modules reference modules that
+	// exist.
+	for source, vs := range vars {
+		for _, v := range vs {
+			mv, ok := v.(*ModuleVariable)
+			if !ok {
+				continue
+			}
+
+			if _, ok := modules[mv.Name]; !ok {
+				errs = append(errs, fmt.Errorf(
+					"%s: unknown module referenced: %s",
+					source,
+					mv.Name))
+			}
+		}
+	}
+
 	// Check that all references to resources are valid
 	resources := make(map[string]*Resource)
 	dupped = make(map[string]struct{})
diff --git a/config/config_test.go b/config/config_test.go
index 581109e9c..26becdd30 100644
--- a/config/config_test.go
+++ b/config/config_test.go
@@ -114,6 +114,20 @@ func TestConfigValidate_varDefaultInterpolate(t *testing.T) {
 	}
 }
 
+func TestConfigValidate_varModule(t *testing.T) {
+	c := testConfig(t, "validate-var-module")
+	if err := c.Validate(); err != nil {
+		t.Fatalf("err: %s", err)
+	}
+}
+
+func TestConfigValidate_varModuleInvalid(t *testing.T) {
+	c := testConfig(t, "validate-var-module-invalid")
+	if err := c.Validate(); err == nil {
+		t.Fatal("should not be valid")
+	}
+}
+
 func TestProviderConfigName(t *testing.T) {
 	pcs := []*ProviderConfig{
 		&ProviderConfig{Name: "aw"},
diff --git a/config/loader_test.go b/config/loader_test.go
index a07d506a8..b92307a70 100644
--- a/config/loader_test.go
+++ b/config/loader_test.go
@@ -699,7 +699,7 @@ foo
 `
 
 const modulesModulesStr = `
-module.bar
+bar
   source = baz
   memory
 `
diff --git a/config/test-fixtures/validate-var-module-invalid/main.tf b/config/test-fixtures/validate-var-module-invalid/main.tf
new file mode 100644
index 000000000..73897c008
--- /dev/null
+++ b/config/test-fixtures/validate-var-module-invalid/main.tf
@@ -0,0 +1,3 @@
+resource "aws_instance" "foo" {
+    foo = "${module.foo.bar}"
+}
diff --git a/config/test-fixtures/validate-var-module/main.tf b/config/test-fixtures/validate-var-module/main.tf
new file mode 100644
index 000000000..402c235a1
--- /dev/null
+++ b/config/test-fixtures/validate-var-module/main.tf
@@ -0,0 +1,5 @@
+module "foo" {}
+
+resource "aws_instance" "foo" {
+    foo = "${module.foo.bar}"
+}