diff --git a/hadoop-yarn-project/CHANGES.txt b/hadoop-yarn-project/CHANGES.txt
index 558c632fe2..71d65da1b5 100644
--- a/hadoop-yarn-project/CHANGES.txt
+++ b/hadoop-yarn-project/CHANGES.txt
@@ -74,6 +74,9 @@ Release 2.0.3-alpha - Unreleased
     YARN-30. Fixed tests verifying web-services to work on JDK7. (Thomas Graves
     via vinodkv)
 
+    YARN-150. Fixes AppRejectedTransition does not unregister a rejected
+    app-attempt from the ApplicationMasterService (Bikas Saha via sseth)
+
 Release 2.0.2-alpha - 2012-09-07 
 
   INCOMPATIBLE CHANGES
diff --git a/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-resourcemanager/src/main/java/org/apache/hadoop/yarn/server/resourcemanager/rmapp/attempt/RMAppAttemptImpl.java b/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-resourcemanager/src/main/java/org/apache/hadoop/yarn/server/resourcemanager/rmapp/attempt/RMAppAttemptImpl.java
index 3bcdda6a33..c4966a1454 100644
--- a/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-resourcemanager/src/main/java/org/apache/hadoop/yarn/server/resourcemanager/rmapp/attempt/RMAppAttemptImpl.java
+++ b/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-resourcemanager/src/main/java/org/apache/hadoop/yarn/server/resourcemanager/rmapp/attempt/RMAppAttemptImpl.java
@@ -591,6 +591,10 @@ public void transition(RMAppAttemptImpl appAttempt,
 
       RMAppAttemptRejectedEvent rejectedEvent = (RMAppAttemptRejectedEvent) event;
 
+      // Tell the AMS. Unregister from the ApplicationMasterService
+      appAttempt.masterService
+          .unregisterAttempt(appAttempt.applicationAttemptId);
+      
       // Save the diagnostic message
       String message = rejectedEvent.getMessage();
       appAttempt.setDiagnostics(message);
diff --git a/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-resourcemanager/src/test/java/org/apache/hadoop/yarn/server/resourcemanager/rmapp/attempt/TestRMAppAttemptTransitions.java b/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-resourcemanager/src/test/java/org/apache/hadoop/yarn/server/resourcemanager/rmapp/attempt/TestRMAppAttemptTransitions.java
index c3da2c3928..d7bb90b4b7 100644
--- a/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-resourcemanager/src/test/java/org/apache/hadoop/yarn/server/resourcemanager/rmapp/attempt/TestRMAppAttemptTransitions.java
+++ b/hadoop-yarn-project/hadoop-yarn/hadoop-yarn-server/hadoop-yarn-server-resourcemanager/src/test/java/org/apache/hadoop/yarn/server/resourcemanager/rmapp/attempt/TestRMAppAttemptTransitions.java
@@ -262,6 +262,10 @@ private void testAppAttemptSubmittedToFailedState(String diagnostics) {
     assertEquals(0, applicationAttempt.getRanNodes().size());
     assertNull(applicationAttempt.getFinalApplicationStatus());
     
+    // Check events
+    verify(masterService).
+        unregisterAttempt(applicationAttempt.getAppAttemptId());
+    
     // this works for unmanaged and managed AM's because this is actually doing
     // verify(application).handle(anyObject());
     verify(application).handle(any(RMAppRejectedEvent.class));
@@ -527,7 +531,8 @@ public void testUnmanagedAMUnexpectedRegistration() {
     // launch AM and verify attempt failed
     applicationAttempt.handle(new RMAppAttemptRegistrationEvent(
         applicationAttempt.getAppAttemptId(), "host", 8042, "oldtrackingurl"));
-    testAppAttemptSubmittedToFailedState("Unmanaged AM must register after AM attempt reaches LAUNCHED state.");
+    testAppAttemptSubmittedToFailedState(
+        "Unmanaged AM must register after AM attempt reaches LAUNCHED state.");
   }
 
   @Test