diff --git a/docs/changes.rst b/docs/changes.rst
index ebd4512f..faefa541 100644
--- a/docs/changes.rst
+++ b/docs/changes.rst
@@ -12,6 +12,19 @@ v0.6.0 (in development)
 
 - Pykka 0.12.3 or greater is required.
 
+- All config, data, and cache locations are now based on the XDG spec.
+
+  - This means that your settings file will need to be moved from
+    ``~/.mopidy/settings.py`` to ``~/.config/mopidy/settings.py``.
+  - Your Spotify cache will now be stored in ``~/.cache/mopidy`` instead of
+    ``~/.mopidy/spotify_cache``, this matches Spotify's own behaviour for their
+    Linux client.
+  - The local backend's ``tag_cache`` should now be in
+    ``~/.local/share/mopidy/tag_cache``, likewise your playlists will be in
+    ``~/.local/share/mopidy/playlists``.
+  - The local client now tries to lookup where your music is via XDG, it will
+    fall-back to ``~/music`` or use whatever setting you set manually.
+
 **Changes**
 
 - Replace :attr:`mopidy.backends.base.Backend.uri_handlers` with
@@ -22,7 +35,7 @@ v0.6.0 (in development)
   ad hoc events the Last.fm scrobbler has already been using for some time.
 - Replaced all of the MPD network code that was provided by asyncore with
   custom stack. This change was made to facilitate the future support of the
-  `idle` command, and to reduce the number of event loops being used.
+  ``idle`` command, and to reduce the number of event loops being used.
 - Fix metadata update in Shoutcast streaming (Fixes: :issue:`122`)
 
 
diff --git a/mopidy/__init__.py b/mopidy/__init__.py
index 7b25c525..1d820fd0 100644
--- a/mopidy/__init__.py
+++ b/mopidy/__init__.py
@@ -3,10 +3,18 @@ import sys
 if not (2, 6) <= sys.version_info < (3,):
     sys.exit(u'Mopidy requires Python >= 2.6, < 3')
 
+import glib
+import os
+
 from subprocess import PIPE, Popen
 
 VERSION = (0, 6, 0)
 
+DATA_PATH = os.path.join(glib.get_user_data_dir(), 'mopidy')
+CACHE_PATH = os.path.join(glib.get_user_cache_dir(), 'mopidy')
+SETTINGS_PATH = os.path.join(glib.get_user_config_dir(), 'mopidy')
+SETTINGS_FILE = os.path.join(SETTINGS_PATH, 'settings.py')
+
 def get_version():
     try:
         return get_git_version()
diff --git a/mopidy/backends/local/__init__.py b/mopidy/backends/local/__init__.py
index af80a8eb..e689f666 100644
--- a/mopidy/backends/local/__init__.py
+++ b/mopidy/backends/local/__init__.py
@@ -1,4 +1,5 @@
 import glob
+import glib
 import logging
 import os
 import shutil
@@ -6,7 +7,7 @@ import shutil
 from pykka.actor import ThreadingActor
 from pykka.registry import ActorRegistry
 
-from mopidy import settings
+from mopidy import settings, DATA_PATH
 from mopidy.backends.base import (Backend, CurrentPlaylistController,
     LibraryController, BaseLibraryProvider, PlaybackController,
     BasePlaybackProvider, StoredPlaylistsController,
@@ -18,6 +19,14 @@ from .translator import parse_m3u, parse_mpd_tag_cache
 
 logger = logging.getLogger(u'mopidy.backends.local')
 
+DEFAULT_PLAYLIST_PATH = os.path.join(DATA_PATH, 'playlists')
+DEFAULT_TAG_CACHE_FILE = os.path.join(DATA_PATH, 'tag_cache')
+DEFAULT_MUSIC_PATH = glib.get_user_special_dir(glib.USER_DIRECTORY_MUSIC)
+
+if not DEFAULT_MUSIC_PATH or DEFAULT_MUSIC_PATH == os.path.expanduser(u'~'):
+    DEFAULT_MUSIC_PATH = os.path.expanduser(u'~/music')
+
+
 class LocalBackend(ThreadingActor, Backend):
     """
     A backend for playing music from a local music archive.
@@ -96,7 +105,7 @@ class LocalPlaybackProvider(BasePlaybackProvider):
 class LocalStoredPlaylistsProvider(BaseStoredPlaylistsProvider):
     def __init__(self, *args, **kwargs):
         super(LocalStoredPlaylistsProvider, self).__init__(*args, **kwargs)
-        self._folder = settings.LOCAL_PLAYLIST_PATH
+        self._folder = settings.LOCAL_PLAYLIST_PATH or DEFAULT_PLAYLIST_PATH
         self.refresh()
 
     def lookup(self, uri):
@@ -173,8 +182,8 @@ class LocalLibraryProvider(BaseLibraryProvider):
         self.refresh()
 
     def refresh(self, uri=None):
-        tag_cache = settings.LOCAL_TAG_CACHE_FILE
-        music_folder = settings.LOCAL_MUSIC_PATH
+        tag_cache = settings.LOCAL_TAG_CACHE_FILE or DEFAULT_TAG_CACHE_FILE
+        music_folder = settings.LOCAL_MUSIC_PATH or DEFAULT_MUSIC_PATH
 
         tracks = parse_mpd_tag_cache(tag_cache, music_folder)
 
diff --git a/mopidy/backends/spotify/session_manager.py b/mopidy/backends/spotify/session_manager.py
index 2c6509ed..9c8853e6 100644
--- a/mopidy/backends/spotify/session_manager.py
+++ b/mopidy/backends/spotify/session_manager.py
@@ -1,3 +1,4 @@
+import glib
 import logging
 import os
 import threading
@@ -6,7 +7,7 @@ from spotify.manager import SpotifySessionManager as PyspotifySessionManager
 
 from pykka.registry import ActorRegistry
 
-from mopidy import get_version, settings
+from mopidy import get_version, settings, CACHE_PATH
 from mopidy.backends.base import Backend
 from mopidy.backends.spotify import BITRATES
 from mopidy.backends.spotify.container_manager import SpotifyContainerManager
@@ -21,9 +22,10 @@ logger = logging.getLogger('mopidy.backends.spotify.session_manager')
 # pylint: disable = R0901
 # SpotifySessionManager: Too many ancestors (9/7)
 
+
 class SpotifySessionManager(BaseThread, PyspotifySessionManager):
-    cache_location = settings.SPOTIFY_CACHE_PATH
-    settings_location = settings.SPOTIFY_CACHE_PATH
+    cache_location = settings.SPOTIFY_CACHE_PATH or CACHE_PATH
+    settings_location = settings.SPOTIFY_CACHE_PATH or CACHE_PATH
     appkey_file = os.path.join(os.path.dirname(__file__), 'spotify_appkey.key')
     user_agent = 'Mopidy %s' % get_version()
 
diff --git a/mopidy/core.py b/mopidy/core.py
index e831fc55..bf794655 100644
--- a/mopidy/core.py
+++ b/mopidy/core.py
@@ -1,5 +1,6 @@
 import logging
 import optparse
+import os
 import signal
 import sys
 
@@ -20,7 +21,7 @@ sys.argv[1:] = gstreamer_args
 from pykka.registry import ActorRegistry
 
 from mopidy import (get_version, settings, OptionalDependencyError,
-    SettingsError)
+    SettingsError, DATA_PATH, SETTINGS_PATH, SETTINGS_FILE)
 from mopidy.gstreamer import GStreamer
 from mopidy.utils import get_class
 from mopidy.utils.log import setup_logging
@@ -37,6 +38,7 @@ def main():
     try:
         options = parse_options()
         setup_logging(options.verbosity_level, options.save_debug_log)
+        check_old_folders()
         setup_settings(options.interactive)
         setup_gstreamer()
         setup_mixer()
@@ -79,9 +81,20 @@ def parse_options():
         help='list current settings')
     return parser.parse_args(args=mopidy_args)[0]
 
+def check_old_folders():
+    old_settings_folder = os.path.expanduser(u'~/.mopidy')
+
+    if not os.path.isdir(old_settings_folder):
+        return
+
+    logger.warning(u'Old settings folder found at %s, settings.py should be '
+        'moved to %s, any cache data should be deleted. See release notes '
+        'for further instructions.', old_settings_folder, SETTINGS_PATH)
+
 def setup_settings(interactive):
-    get_or_create_folder('~/.mopidy/')
-    get_or_create_file('~/.mopidy/settings.py')
+    get_or_create_folder(SETTINGS_PATH)
+    get_or_create_folder(DATA_PATH)
+    get_or_create_file(SETTINGS_FILE)
     try:
         settings.validate(interactive)
     except SettingsError, e:
diff --git a/mopidy/settings.py b/mopidy/settings.py
index a1edfdeb..70d71832 100644
--- a/mopidy/settings.py
+++ b/mopidy/settings.py
@@ -4,7 +4,7 @@ Available settings and their default values.
 .. warning::
 
     Do *not* change settings directly in :mod:`mopidy.settings`. Instead, add a
-    file called ``~/.mopidy/settings.py`` and redefine settings there.
+    file called ``~/.config/mopidy/settings.py`` and redefine settings there.
 """
 
 #: List of playback backends to use. See :mod:`mopidy.backends` for all
@@ -79,8 +79,9 @@ LASTFM_PASSWORD = u''
 #:
 #: Default::
 #:
-#:    LOCAL_MUSIC_PATH = u'~/music'
-LOCAL_MUSIC_PATH = u'~/music'
+#:    # Defaults to asking glib where music is stored, fallback is ~/music
+#:    LOCAL_MUSIC_PATH = None
+LOCAL_MUSIC_PATH = None
 
 #: Path to playlist folder with m3u files for local music.
 #:
@@ -88,8 +89,8 @@ LOCAL_MUSIC_PATH = u'~/music'
 #:
 #: Default::
 #:
-#:    LOCAL_PLAYLIST_PATH = u'~/.mopidy/playlists'
-LOCAL_PLAYLIST_PATH = u'~/.mopidy/playlists'
+#:    LOCAL_PLAYLIST_PATH = None # Implies $XDG_DATA_DIR/mopidy/playlists
+LOCAL_PLAYLIST_PATH = None
 
 #: Path to tag cache for local music.
 #:
@@ -97,8 +98,8 @@ LOCAL_PLAYLIST_PATH = u'~/.mopidy/playlists'
 #:
 #: Default::
 #:
-#:    LOCAL_TAG_CACHE_FILE = u'~/.mopidy/tag_cache'
-LOCAL_TAG_CACHE_FILE = u'~/.mopidy/tag_cache'
+#:    LOCAL_TAG_CACHE_FILE = None # Implies $XDG_DATA_DIR/mopidy/tag_cache
+LOCAL_TAG_CACHE_FILE = None
 
 #: Sound mixer to use. See :mod:`mopidy.mixers` for all available mixers.
 #:
@@ -238,7 +239,7 @@ SHOUTCAST_OUTPUT_ENCODER = u'lame mode=stereo bitrate=320'
 #: Path to the Spotify cache.
 #:
 #: Used by :mod:`mopidy.backends.spotify`.
-SPOTIFY_CACHE_PATH = u'~/.mopidy/spotify_cache'
+SPOTIFY_CACHE_PATH = None
 
 #: Your Spotify Premium username.
 #:
diff --git a/mopidy/utils/settings.py b/mopidy/utils/settings.py
index 3f7593af..fca4f337 100644
--- a/mopidy/utils/settings.py
+++ b/mopidy/utils/settings.py
@@ -2,12 +2,13 @@
 from __future__ import absolute_import
 from copy import copy
 import getpass
+import glib
 import logging
 import os
 from pprint import pformat
 import sys
 
-from mopidy import SettingsError
+from mopidy import SettingsError, SETTINGS_PATH, SETTINGS_FILE
 from mopidy.utils.log import indent
 
 logger = logging.getLogger('mopidy.utils.settings')
@@ -20,11 +21,9 @@ class SettingsProxy(object):
         self.runtime = {}
 
     def _get_local_settings(self):
-        dotdir = os.path.expanduser(u'~/.mopidy/')
-        settings_file = os.path.join(dotdir, u'settings.py')
-        if not os.path.isfile(settings_file):
+        if not os.path.isfile(SETTINGS_FILE):
             return {}
-        sys.path.insert(0, dotdir)
+        sys.path.insert(0, SETTINGS_PATH)
         # pylint: disable = F0401
         import settings as local_settings_module
         # pylint: enable = F0401