diff --git a/moto/cloudformation/models.py b/moto/cloudformation/models.py
index b58d1dcf0..824d568a2 100644
--- a/moto/cloudformation/models.py
+++ b/moto/cloudformation/models.py
@@ -1,6 +1,7 @@
 from __future__ import unicode_literals
 from datetime import datetime
 import json
+import yaml
 import uuid
 
 import boto.cloudformation
@@ -17,7 +18,7 @@ class FakeStack(BaseModel):
         self.stack_id = stack_id
         self.name = name
         self.template = template
-        self.template_dict = json.loads(self.template)
+        self._parse_template()
         self.parameters = parameters
         self.region_name = region_name
         self.notification_arns = notification_arns if notification_arns else []
@@ -70,6 +71,12 @@ class FakeStack(BaseModel):
             resource_properties=resource_properties,
         ))
 
+    def _parse_template(self):
+        try:
+            self.template_dict = json.loads(self.template)
+        except json.JSONDecodeError:
+            self.template_dict = yaml.load(self.template)
+
     @property
     def stack_parameters(self):
         return self.resource_map.resolved_parameters
diff --git a/tests/test_cloudformation/test_stack_parsing.py b/tests/test_cloudformation/test_stack_parsing.py
index c2af6363a..610b02325 100644
--- a/tests/test_cloudformation/test_stack_parsing.py
+++ b/tests/test_cloudformation/test_stack_parsing.py
@@ -1,5 +1,6 @@
 from __future__ import unicode_literals
 import json
+import yaml
 
 from mock import patch
 import sure  # noqa
@@ -126,6 +127,20 @@ def test_parse_stack_with_name_type_resource():
     queue.should.be.a(Queue)
 
 
+def test_parse_stack_with_yaml_template():
+    stack = FakeStack(
+        stack_id="test_id",
+        name="test_stack",
+        template=yaml.dump(name_type_template),
+        parameters={},
+        region_name='us-west-1')
+
+    stack.resource_map.should.have.length_of(1)
+    list(stack.resource_map.keys())[0].should.equal('Queue')
+    queue = list(stack.resource_map.values())[0]
+    queue.should.be.a(Queue)
+
+
 def test_parse_stack_with_outputs():
     stack = FakeStack(
         stack_id="test_id",