diff --git a/glabels/LabelEditor.cpp b/glabels/LabelEditor.cpp
index c965383..5acc43b 100644
--- a/glabels/LabelEditor.cpp
+++ b/glabels/LabelEditor.cpp
@@ -38,6 +38,7 @@
 #include "model/Markup.h"
 #include "model/Settings.h"
 
+#include <QMimeData>
 #include <QMouseEvent>
 #include <QtMath>
 #include <QtDebug>
@@ -105,6 +106,7 @@ namespace glabels
 
 		setMouseTracking( true );
 		setFocusPolicy(Qt::StrongFocus);
+		setAcceptDrops( true );
 
 		connect( model::Settings::instance(), SIGNAL(changed()), this, SLOT(onSettingsChanged()) );
 		onSettingsChanged();
@@ -590,7 +592,7 @@ namespace glabels
 				//
 				if ( mState == IdleState )
 				{
-					emit contextMenuActivate();
+					emit contextMenuActivate( model::Point( xWorld, yWorld ) );
 				}
 			}
 		}
@@ -621,7 +623,7 @@ namespace glabels
 			/*
 			 * Emit signal regardless of mode
 			 */
-			emit pointerMoved( xWorld, yWorld );
+			emit pointerMoved( model::Point( xWorld, yWorld ) );
 
 
 			/*
@@ -1027,6 +1029,85 @@ namespace glabels
 	}
 
 
+	//
+	// Handle drag enter event
+	//
+	void LabelEditor::dragEnterEvent( QDragEnterEvent *event )
+	{
+		if ( event->mimeData()->hasUrls()   ||
+		     event->mimeData()->hasImage()  ||
+		     event->mimeData()->hasText() )
+		{
+			event->acceptProposedAction();
+		}
+		else
+		{
+			event->ignore();
+		}
+	}
+
+
+	//
+	// Handle drag move event
+	//
+	void LabelEditor::dragMoveEvent( QDragMoveEvent *event )
+	{
+		if ( event->mimeData()->hasUrls()   ||
+		     event->mimeData()->hasImage()  ||
+		     event->mimeData()->hasText() )
+		{
+			event->acceptProposedAction();
+		}
+		else
+		{
+			event->ignore();
+		}
+	}
+
+
+	//
+	// Handle drop event
+	//
+	void LabelEditor::dropEvent( QDropEvent *event )
+	{
+		/*
+		 * Transform to label coordinates
+		 */
+		QTransform transform;
+
+		transform.scale( mScale, mScale );
+		transform.translate( mX0.pt(), mY0.pt() );
+
+		QPointF pWorld = transform.inverted().map( event->position() );
+		auto xWorld = model::Distance::pt( pWorld.x() );
+		auto yWorld = model::Distance::pt( pWorld.y() );
+		auto p = model::Point( xWorld, yWorld );
+
+		if ( event->mimeData()->hasUrls() )
+		{
+			mUndoRedoModel->checkpoint( tr("Drop") );
+			mModel->pasteAsUrls( event->mimeData(), p );
+			event->acceptProposedAction();
+		}
+		else if ( event->mimeData()->hasImage() )
+		{
+			mUndoRedoModel->checkpoint( tr("Drop") );
+			mModel->pasteAsImage( event->mimeData(), p );
+			event->acceptProposedAction();
+		}
+		else if ( event->mimeData()->hasText() )
+		{
+			mUndoRedoModel->checkpoint( tr("Drop") );
+			mModel->pasteAsText( event->mimeData(), p );
+			event->acceptProposedAction();
+		}
+		else
+		{
+			event->ignore();
+		}
+	}
+
+
 	///
 	/// Draw Background Layer
 	///
@@ -1283,4 +1364,5 @@ namespace glabels
 		emit zoomChanged();
 	}
 
+
 } // namespace glabels
diff --git a/glabels/LabelEditor.h b/glabels/LabelEditor.h
index afbf1b6..0e31d1b 100644
--- a/glabels/LabelEditor.h
+++ b/glabels/LabelEditor.h
@@ -57,9 +57,9 @@ namespace glabels
 		// Signals
 		/////////////////////////////////////
 	signals:
-		void contextMenuActivate();
+		void contextMenuActivate( model::Point p );
 		void zoomChanged();
-		void pointerMoved( const model::Distance& x, const model::Distance& y );
+		void pointerMoved( model::Point p );
 		void pointerExited();
 		void modeChanged();
 
@@ -126,6 +126,9 @@ namespace glabels
 		void leaveEvent( QEvent* event ) override;
 		void keyPressEvent( QKeyEvent* event ) override;
 		void paintEvent( QPaintEvent* event ) override;
+		void dragEnterEvent( QDragEnterEvent *event ) override;
+		void dragMoveEvent( QDragMoveEvent *event ) override;
+		void dropEvent( QDropEvent *event ) override;
 
 
 		/////////////////////////////////////
diff --git a/glabels/MainWindow.cpp b/glabels/MainWindow.cpp
index e7b7c2c..e52f9b3 100644
--- a/glabels/MainWindow.cpp
+++ b/glabels/MainWindow.cpp
@@ -196,8 +196,8 @@ namespace glabels
 		connect( model::Settings::instance(), SIGNAL(changed()), this, SLOT(onSettingsChanged()) );
 		connect( QApplication::clipboard(), SIGNAL(dataChanged()), this, SLOT(clipboardChanged()) );
 #if 0
-		connect( mLabelEditor, SIGNAL(pointerMoved(double, double)),
-		         this, SLOT(onPointerMoved(double, double)) );
+		connect( mLabelEditor, SIGNAL(pointerMoved(model::Point)),
+		         this, SLOT(onPointerMoved(modelPoint)) );
 		connect( mLabelEditor, SIGNAL(pointerExited()), this, SLOT(onPointerExit()) );
 #endif
 
@@ -253,7 +253,7 @@ namespace glabels
 		manageActions();
 		setTitle();
 
-		connect( mLabelEditor, SIGNAL(contextMenuActivate()), this, SLOT(onContextMenuActivate()) );
+		connect( mLabelEditor, SIGNAL(contextMenuActivate(model::Point)), this, SLOT(onContextMenuActivate(model::Point)) );
 		connect( mModel, SIGNAL(nameChanged()), this, SLOT(onNameChanged()) );
 		connect( mModel, SIGNAL(modifiedChanged()), this, SLOT(onModifiedChanged()) );
 		connect( mModel, SIGNAL(selectionChanged()), this, SLOT(onSelectionChanged()) );
@@ -611,7 +611,7 @@ namespace glabels
 		contextPasteAction = new QAction( tr("&Paste"), this );
 		contextPasteAction->setIcon( Icons::EditPaste() );
 		contextPasteAction->setStatusTip( tr("Paste the clipboard") );
-		connect( contextPasteAction, SIGNAL(triggered()), this, SLOT(editPaste()) );
+		connect( contextPasteAction, SIGNAL(triggered()), this, SLOT(editContextPaste()) );
 
 		contextDeleteAction = new QAction( tr("&Delete"), this );
 		contextDeleteAction->setIcon( QIcon::fromTheme( "edit-delete" ) );
@@ -1345,7 +1345,21 @@ namespace glabels
 	void MainWindow::editPaste()
 	{
 		mUndoRedoModel->checkpoint( tr("Paste") );
-		mModel->paste();
+		mModel->paste( model::Point() );
+	}
+
+
+	///
+	/// Edit->Paste Action (from context menu)
+	///
+	void MainWindow::editContextPaste()
+	{
+		// Extract original context menu click location
+		auto *action = qobject_cast<QAction *>(sender());
+		auto p = action->data().value<model::Point>();
+
+		mUndoRedoModel->checkpoint( tr("Paste") );
+		mModel->paste( p );
 	}
 
 
@@ -1708,8 +1722,13 @@ namespace glabels
 	///
 	/// Context Menu Activation
 	///
-	void MainWindow::onContextMenuActivate()
+	void MainWindow::onContextMenuActivate( model::Point p )
 	{
+		// Save click location for potential paste action
+		QVariant variant;
+		variant.setValue( p );
+		contextPasteAction->setData( variant );
+
 		if ( mModel->isSelectionEmpty() )
 		{
 			noSelectionContextMenu->popup( QCursor::pos() );
@@ -1736,10 +1755,12 @@ namespace glabels
 	///
 	/// Pointer moved: update Cursor Information in Status Bar
 	///
-	void MainWindow::onPointerMoved( double x, double y )
+	void MainWindow::onPointerMoved( model::Point p )
 	{
-		/* TODO: convert x,y to locale units and set precision accordingly. */
-		cursorInfoLabel->setText( QString( "%1, %2" ).arg(x).arg(y) );
+		/* TODO: set precision accordingly. */
+		auto units = model::Settings::units();
+		cursorInfoLabel->setText( QString( "%1, %2" ).arg( p.x().toString(units) )
+		                                             .arg( p.y().toString(units) ) );
 	}
 
 
diff --git a/glabels/MainWindow.h b/glabels/MainWindow.h
index fc4c0a5..d2a2807 100644
--- a/glabels/MainWindow.h
+++ b/glabels/MainWindow.h
@@ -109,6 +109,7 @@ namespace glabels
 		void editCut();
 		void editCopy();
 		void editPaste();
+		void editContextPaste();
 		void editDelete();
 		void editSelectAll();
 		void editUnSelectAll();
@@ -150,10 +151,10 @@ namespace glabels
 		void helpReportBug();
 		void helpAbout();
 
-		void onContextMenuActivate();
+		void onContextMenuActivate( model::Point );
 
 		void onZoomChanged();
-		void onPointerMoved( double, double );
+		void onPointerMoved( model::Point );
 		void onPointerExit();
 
 		void onNameChanged();
diff --git a/model/Model.cpp b/model/Model.cpp
index a1bd456..325a91f 100644
--- a/model/Model.cpp
+++ b/model/Model.cpp
@@ -33,7 +33,6 @@
 #include <QApplication>
 #include <QClipboard>
 #include <QFileInfo>
-#include <QMimeData>
 #include <QtDebug>
 
 
@@ -1480,67 +1479,130 @@ namespace glabels
 			const QClipboard *clipboard = QApplication::clipboard();
 			const QMimeData *mimeData = clipboard->mimeData();
 
-			if ( mimeData->hasFormat( MIME_TYPE ) )
-			{
-				return true;
-			}
-			else if ( mimeData->hasImage() )
-			{
-				return true;
-			}
-			else if ( mimeData->hasText() )
-			{
-				return true;
-			}
-			return false;
+			return  mimeData->hasFormat( MIME_TYPE ) ||
+				mimeData->hasUrls()              ||
+				mimeData->hasImage()             ||
+				mimeData->hasText();
 		}
 
 
 		///
 		/// Paste from clipboard
 		///
-		void Model::paste()
+		void Model::paste( Point p )
 		{
 			const QClipboard *clipboard = QApplication::clipboard();
 			const QMimeData *mimeData = clipboard->mimeData();
 
 			if ( mimeData->hasFormat( MIME_TYPE ) )
 			{
-				// Native objects
-				QByteArray buffer = mimeData->data( MIME_TYPE );
-				QList <ModelObject*> objects = XmlLabelParser::deserializeObjects( buffer, this );
-
-				unselectAll();
-				foreach ( ModelObject* object, objects )
-				{
-					addObject( object );
-					selectObject( object );
-				}
+				pasteAsNativeObjects( mimeData, p );
+			}
+			else if ( mimeData->hasUrls() )
+			{
+				pasteAsUrls( mimeData, p );
 			}
 			else if ( mimeData->hasImage() )
 			{
-				// Create object from clipboard image
-				auto* object = new ModelImageObject();
-				object->setImage( qvariant_cast<QImage>(mimeData->imageData()) );
-				object->setSize( object->naturalSize() );
-				object->setPosition( (w()-object->w())/2.0, (h()-object->h())/2.0 );
-				addObject( object );
-				unselectAll();
-				selectObject( object );
+				pasteAsImage( mimeData, p );
 			}
 			else if ( mimeData->hasText() )
 			{
-				// Create object from clipboard text
-				auto* object = new ModelTextObject();
-				object->setText( mimeData->text() );
-				object->setSize( object->naturalSize() );
-				object->setPosition( (w()-object->w())/2.0, (h()-object->h())/2.0 );
+				pasteAsText( mimeData, p );
+			}
+		}
+
+
+		///
+		/// Paste as native objects
+		///
+		void Model::pasteAsNativeObjects( const QMimeData* mimeData, Point p )
+		{
+			QByteArray buffer = mimeData->data( MIME_TYPE );
+			QList <ModelObject*> objects = XmlLabelParser::deserializeObjects( buffer, this );
+
+			unselectAll();
+			foreach ( ModelObject* object, objects )
+			{
+				object->setPositionRelative( p.x(), p.y() );
 				addObject( object );
-				unselectAll();
 				selectObject( object );
 			}
 		}
 
+		
+		///
+		/// Paste as URLs ( currently only supports local image files )
+		///
+		void Model::pasteAsUrls( const QMimeData* mimeData, Point p )
+		{
+			auto x = p.x();
+			auto y = p.y();
+			auto xOffset = Distance::pt( 10 );
+			auto yOffset = Distance::pt( 10 );
+			
+			unselectAll();
+			for ( auto url : mimeData->urls() )
+			{
+				if ( url.isLocalFile() )
+				{
+					auto name = url.toLocalFile();
+					QImage image( name );
+					if ( !image.isNull() )
+					{
+						auto* object = new ModelImageObject();
+						object->setImage( name, image );
+						object->setSize( object->naturalSize() );
+						object->setPosition( x, y );
+						addObject( object );
+						selectObject( object );
+
+						x = fmod( x + xOffset, w() );
+						y = fmod( y + yOffset, h() );
+					}
+					else
+					{
+						qWarning() << "Cannot paste" << name
+						           << ": does not exist or currently unsupported file type.";
+					}
+				}
+				else
+				{
+					qWarning() << "Cannot paste" << url.toString()
+					           << ": currently unsupported file location.";
+				}
+			}
+		}
+
+		
+		///
+		/// Paste as image
+		///
+		void Model::pasteAsImage( const QMimeData* mimeData, Point p )
+		{
+			auto* object = new ModelImageObject();
+			object->setImage( qvariant_cast<QImage>(mimeData->imageData()) );
+			object->setSize( object->naturalSize() );
+			object->setPosition( p.x(), p.y() );
+			addObject( object );
+			unselectAll();
+			selectObject( object );
+		}
+
+		
+		///
+		/// Paste as text
+		void Model::pasteAsText( const QMimeData* mimeData, Point p )
+		{
+			auto* object = new ModelTextObject();
+			object->setText( mimeData->text() );
+			object->setSize( object->naturalSize() );
+			object->setPosition( p.x(), p.y() );
+			addObject( object );
+			unselectAll();
+			selectObject( object );
+		}
+
 
 		///
 		/// Draw label objects
diff --git a/model/Model.h b/model/Model.h
index b3e5a97..52cec1f 100644
--- a/model/Model.h
+++ b/model/Model.h
@@ -31,6 +31,7 @@
 
 #include <QDir>
 #include <QList>
+#include <QMimeData>
 #include <QObject>
 #include <QPainter>
 
@@ -207,8 +208,12 @@ namespace glabels
 			void copySelection();
 			void cutSelection();
 			bool canPaste();
-			void paste();
-	
+			void paste( Point p );
+			void pasteAsNativeObjects( const QMimeData* mimeData, Point p );
+			void pasteAsUrls( const QMimeData* mimeData, Point p );
+			void pasteAsImage( const QMimeData* mimeData, Point p );
+			void pasteAsText( const QMimeData* mimeData, Point p );
+
 			/////////////////////////////////
 			// Drawing operations
 			/////////////////////////////////
diff --git a/model/ModelImageObject.cpp b/model/ModelImageObject.cpp
index bb4ce8a..e95f7ef 100644
--- a/model/ModelImageObject.cpp
+++ b/model/ModelImageObject.cpp
@@ -73,6 +73,8 @@ namespace glabels
 			{
 				smDefaultImage = new QImage( ":images/checkerboard.png" );
 			}
+
+			mLockAspectRatio = true;
 		}
 
 
diff --git a/model/Point.h b/model/Point.h
index 4750ab5..8b8a5c0 100644
--- a/model/Point.h
+++ b/model/Point.h
@@ -24,6 +24,8 @@
 
 #include "Distance.h"
 
+#include <QMetaType>
+
 
 namespace glabels
 {
@@ -52,4 +54,7 @@ namespace glabels
 }
 
 
+Q_DECLARE_METATYPE( glabels::model::Point )
+
+
 #endif // model_Point_h
diff --git a/translations/glabels_C.ts b/translations/glabels_C.ts
index 350c2e3..df9a6f8 100644
--- a/translations/glabels_C.ts
+++ b/translations/glabels_C.ts
@@ -1328,6 +1328,10 @@
         <source>Resize</source>
         <translation type="unfinished"></translation>
     </message>
+    <message>
+        <source>Drop</source>
+        <translation type="unfinished"></translation>
+    </message>
 </context>
 <context>
     <name>glabels::MainWindow</name>