diff --git a/moto/ec2/models.py b/moto/ec2/models.py
index b3fe3f699..ab13661eb 100644
--- a/moto/ec2/models.py
+++ b/moto/ec2/models.py
@@ -3,7 +3,7 @@ from collections import defaultdict
 from boto.ec2.instance import Instance, InstanceState, Reservation
 
 from moto.core import BaseBackend
-from .utils import random_instance_id, random_reservation_id, random_ami_id
+from .utils import random_instance_id, random_reservation_id, random_ami_id, random_security_group_id
 
 
 class InstanceBackend(object):
@@ -133,7 +133,7 @@ class AmiBackend(object):
     def create_image(self, instance_id, name, description):
         # TODO: check that instance exists and pull info from it.
         ami_id = random_ami_id()
-        instance = ec2_backend.get_instance(instance_id)
+        instance = self.get_instance(instance_id)
         if not instance:
             return None
         ami =  Ami(ami_id, instance, name, description)
@@ -193,7 +193,46 @@ class RegionsAndZonesBackend(object):
         return self.zones
 
 
-class EC2Backend(BaseBackend, InstanceBackend, TagBackend, AmiBackend, RegionsAndZonesBackend):
+class SecurityGroup(object):
+    def __init__(self, group_id, name, description):
+        self.id = group_id
+        self.name = name
+        self.description = description
+
+
+class SecurityGroupBackend(object):
+
+    def __init__(self):
+        self.groups = {}
+
+    def create_security_group(self, name, description):
+        group_id = random_security_group_id()
+        existing_group = self.get_security_group_from_name(name)
+        if existing_group:
+            return None
+        group =  SecurityGroup(group_id, name, description)
+        self.groups[group_id] = group
+        return group
+
+    def describe_security_groups(self):
+        return self.groups.values()
+
+    def delete_security_group(self, name_or_group_id):
+        if name_or_group_id in self.groups:
+            # Group Id
+            return self.groups.pop(name_or_group_id)
+        else:
+            # Group Name
+            group = self.get_security_group_from_name(name_or_group_id)
+            if group:
+                return self.groups.pop(group.id)
+
+    def get_security_group_from_name(self, name):
+        for group_id, group in self.groups.iteritems():
+            if group.name == name:
+                return group
+
+class EC2Backend(BaseBackend, InstanceBackend, TagBackend, AmiBackend, RegionsAndZonesBackend, SecurityGroupBackend):
     pass
 
 
diff --git a/moto/ec2/responses/__init__.py b/moto/ec2/responses/__init__.py
index c67c3e30e..7da82d3f6 100644
--- a/moto/ec2/responses/__init__.py
+++ b/moto/ec2/responses/__init__.py
@@ -35,7 +35,7 @@ from .tags import TagResponse
 
 class EC2Response(object):
 
-    sub_responses = [InstanceResponse, TagResponse, AmisResponse, AvailabilityZonesAndRegions]
+    sub_responses = [InstanceResponse, TagResponse, AmisResponse, AvailabilityZonesAndRegions, SecurityGroups]
 
     def dispatch(self, uri, body, headers):
         if body:
diff --git a/moto/ec2/responses/security_groups.py b/moto/ec2/responses/security_groups.py
index 15351811b..10541d898 100644
--- a/moto/ec2/responses/security_groups.py
+++ b/moto/ec2/responses/security_groups.py
@@ -5,6 +5,9 @@ from moto.ec2.utils import resource_ids_from_querystring
 
 
 class SecurityGroups(object):
+    def __init__(self, querystring):
+        self.querystring = querystring
+
     def authorize_security_group_egress(self):
         raise NotImplementedError('SecurityGroups.authorize_security_group_egress is not yet implemented')
 
@@ -12,13 +15,28 @@ class SecurityGroups(object):
         raise NotImplementedError('SecurityGroups.authorize_security_group_ingress is not yet implemented')
 
     def create_security_group(self):
-        raise NotImplementedError('SecurityGroups.create_security_group is not yet implemented')
+        name = self.querystring.get('GroupName')[0]
+        description = self.querystring.get('GroupDescription')[0]
+        group = ec2_backend.create_security_group(name, description)
+        if not group:
+            # There was an exisitng group
+            return "There was an existing security group with name {}".format(name), dict(status=409)
+        template = Template(CREATE_SECURITY_GROUP_RESPONSE)
+        return template.render(group=group)
 
     def delete_security_group(self):
-        raise NotImplementedError('SecurityGroups.delete_security_group is not yet implemented')
+        name = self.querystring.get('GroupName')[0]
+        group = ec2_backend.delete_security_group(name)
+
+        if not group:
+            # There was no such group
+            return "There was no security group with name {}".format(name), dict(status=404)
+        return DELETE_GROUP_RESPONSE
 
     def describe_security_groups(self):
-        raise NotImplementedError('SecurityGroups.describe_security_groups is not yet implemented')
+        groups = ec2_backend.describe_security_groups()
+        template = Template(DESCRIBE_SECURITY_GROUPS_RESPONSE)
+        return template.render(groups=groups)
 
     def revoke_security_group_egress(self):
         raise NotImplementedError('SecurityGroups.revoke_security_group_egress is not yet implemented')
@@ -26,3 +44,43 @@ class SecurityGroups(object):
     def revoke_security_group_ingress(self):
         raise NotImplementedError('SecurityGroups.revoke_security_group_ingress is not yet implemented')
 
+
+CREATE_SECURITY_GROUP_RESPONSE = """<CreateSecurityGroupResponse xmlns="http://ec2.amazonaws.com/doc/2012-12-01/">
+   <requestId>59dbff89-35bd-4eac-99ed-be587EXAMPLE</requestId>
+   <return>true</return>
+   <groupId>{{ group.id }}</groupId>
+</CreateSecurityGroupResponse>"""
+
+DELETE_GROUP_RESPONSE = """<DeleteSecurityGroupResponse xmlns="http://ec2.amazonaws.com/doc/2012-12-01/">
+  <requestId>59dbff89-35bd-4eac-99ed-be587EXAMPLE</requestId>
+  <return>true</return>
+</DeleteSecurityGroupResponse>"""
+
+DESCRIBE_SECURITY_GROUPS_RESPONSE = """<DescribeSecurityGroupsResponse xmlns="http://ec2.amazonaws.com/doc/2012-12-01/">
+   <requestId>59dbff89-35bd-4eac-99ed-be587EXAMPLE</requestId>
+   <securityGroupInfo>
+      {% for group in groups %}
+          <item>
+             <ownerId>111122223333</ownerId>
+             <groupId>{{ group.id }}</groupId>
+             <groupName>{{ group.name }}</groupName>
+             <groupDescription>{{ group.description }}</groupDescription>
+             <vpcId/>
+             <ipPermissions>
+                <item>
+                   <ipProtocol>tcp</ipProtocol>
+                   <fromPort>80</fromPort>
+                   <toPort>80</toPort>
+                   <groups/>
+                   <ipRanges>
+                      <item>
+                         <cidrIp>0.0.0.0/0</cidrIp>
+                      </item>
+                   </ipRanges>
+                </item>
+             </ipPermissions>
+             <ipPermissionsEgress/>
+          </item>
+      {% endfor %}
+   </securityGroupInfo>
+</DescribeSecurityGroupsResponse>"""
\ No newline at end of file
diff --git a/moto/ec2/utils.py b/moto/ec2/utils.py
index c86bafa71..bbe808d4f 100644
--- a/moto/ec2/utils.py
+++ b/moto/ec2/utils.py
@@ -22,6 +22,10 @@ def random_ami_id():
     return random_id(prefix='ami')
 
 
+def random_security_group_id():
+    return random_id(prefix='sg')
+
+
 def instance_ids_from_querystring(querystring_dict):
     instance_ids = []
     for key, value in querystring_dict.iteritems():
diff --git a/tests/test_ec2/test_security_groups.py b/tests/test_ec2/test_security_groups.py
index 9bba776f9..95476892c 100644
--- a/tests/test_ec2/test_security_groups.py
+++ b/tests/test_ec2/test_security_groups.py
@@ -1,9 +1,41 @@
 import boto
+from boto.exception import EC2ResponseError
 from sure import expect
 
 from moto import mock_ec2
 
 
 @mock_ec2
-def test_security_groups():
-    pass
+def test_create_and_describe_security_group():
+    conn = boto.connect_ec2('the_key', 'the_secret')
+    security_group = conn.create_security_group('test security group', 'this is a test security group')
+
+    security_group.name.should.equal('test security group')
+    security_group.description.should.equal('this is a test security group')
+
+    # Trying to create another group with the same name should throw an error
+    conn.create_security_group.when.called_with('test security group', 'this is a test security group').should.throw(EC2ResponseError)
+
+    all_groups = conn.get_all_security_groups()
+    all_groups.should.have.length_of(1)
+    all_groups[0].name.should.equal('test security group')
+
+
+@mock_ec2
+def test_deleting_security_groups():
+    conn = boto.connect_ec2('the_key', 'the_secret')
+    security_group1 = conn.create_security_group('test1', 'test1')
+    security_group2 = conn.create_security_group('test2', 'test2')
+
+    conn.get_all_security_groups().should.have.length_of(2)
+
+    # Deleting a group that doesn't exist should throw an error
+    conn.delete_security_group.when.called_with('foobar').should.throw(EC2ResponseError)
+
+    # Delete by name
+    conn.delete_security_group('test2')
+    conn.get_all_security_groups().should.have.length_of(1)
+
+    # Delete by group id
+    conn.delete_security_group(security_group1.id)
+    conn.get_all_security_groups().should.have.length_of(0)