diff --git a/gems/src/server/file_terminal/README b/gems/src/server/file_terminal/README
new file mode 100644
index 000000000..bd7d9bd81
--- /dev/null
+++ b/gems/src/server/file_terminal/README
@@ -0,0 +1,9 @@
+File terminal is a service that provides Genode's Terminal_session interface
+for a given file via a File_system_session.
+
+! <config>
+!   <policy label="client1" filename="test.txt" />
+!   <policy label="client2" filename="file.dat" io_buffer_size="4K"/>h
+! </config>
+
+To keep things simple a client can only open one file at the moment.
diff --git a/gems/src/server/file_terminal/main.cc b/gems/src/server/file_terminal/main.cc
new file mode 100644
index 000000000..4167afb64
--- /dev/null
+++ b/gems/src/server/file_terminal/main.cc
@@ -0,0 +1,291 @@
+/*
+ * \brief  Service providing the 'Terminal_session' interface for a file
+ * \author Josef Soentgen
+ * \date   2013-10-08
+ */
+
+/*
+ * Copyright (C) 2013 Genode Labs GmbH
+ *
+ * This file is part of the Genode OS framework, which is distributed
+ * under the terms of the GNU General Public License version 2.
+ */
+
+/* Genode includes */
+#include <base/heap.h>
+#include <base/printf.h>
+#include <base/rpc_server.h>
+#include <base/sleep.h>
+#include <cap_session/connection.h>
+#include <os/attached_ram_dataspace.h>
+#include <os/session_policy.h>
+#include <root/component.h>
+#include <terminal_session/terminal_session.h>
+
+/* libc includes */
+#include <unistd.h>
+#include <sys/types.h>
+#include <sys/select.h>
+#include <stdio.h>
+#include <fcntl.h>
+
+
+static bool const verbose = false;
+
+#define PDBGV(...) if (verbose) PDBG(__VA_ARGS__)
+
+
+class Open_file
+{
+	private:
+
+		/**
+		 * File descriptor for open file
+		 */
+		int _fd;
+
+		/**
+		 * Signal handler to be informed about the established connection
+		 */
+		Genode::Signal_context_capability _connected_sigh;
+
+		/**
+		 * Signal handler to be informed about data available to read
+		 */
+		Genode::Signal_context_capability _read_avail_sigh;
+
+		/**
+		 * Buffer for incoming data
+		 *
+		 * This buffer is used for synchronizing the reception of data in the
+		 * main thread ('watch_sockets_for_incoming_data') and the entrypoint
+		 * thread ('read'). The main thread fills the buffer if its not already
+		 * occupied and the entrypoint thread consumes the buffer. When the
+		 * buffer becomes occupied, the corresponding socket gets removed from
+		 * the 'rfds' set of 'select()' until a read request from the terminal
+		 * client comes in.
+		 */
+		enum { READ_BUF_SIZE = 4096 };
+		char           _read_buf[READ_BUF_SIZE];
+		Genode::size_t _read_buf_bytes_used;
+
+	public:
+
+		Open_file(const char *filename) : _fd(-1)
+		{
+			PDBGV("open '%s'", filename);
+			_fd = ::open(filename, O_CREAT|O_RDWR);
+			if (_fd == -1)
+				::perror("open");
+		}
+
+		~Open_file() { close(_fd); }
+
+		/**
+		 * Return file descriptor of the open file
+		 */
+		int fd() const { return _fd; }
+
+		/**
+		 * Register signal handler to be notified once we openend the file
+		 */
+		void connected_sigh(Genode::Signal_context_capability sigh)
+		{
+			_connected_sigh = sigh;
+
+			/* notify the client immediatly if we have already openend the file */
+			if (file_opened() && _connected_sigh.valid())
+				Genode::Signal_transmitter(_connected_sigh).submit();
+		}
+
+		/**
+		 * Register signal handler to be notified when data is available for
+		 * reading
+		 */
+		void read_avail_sigh(Genode::Signal_context_capability sigh)
+		{
+			_read_avail_sigh = sigh;
+
+			/* if read data is available right now, deliver signal immediately */
+			if (!read_buffer_empty() && _read_avail_sigh.valid())
+				Genode::Signal_transmitter(_read_avail_sigh).submit();
+		}
+
+		 /**
+		  * Return true if the file was successfully openend
+		  */
+		bool file_opened() const { return _fd != -1; }
+
+		/**
+		 * Fetch data from socket into internal read buffer
+		 */
+		void fill_read_buffer_and_notify_client()
+		{
+			if (_read_buf_bytes_used) {
+				PWRN("read buffer already in use");
+				return;
+			}
+
+			/* read from file */
+			_read_buf_bytes_used = ::read(_fd, _read_buf, sizeof(_read_buf));
+
+			/* notify client about bytes available for reading */
+			if (_read_avail_sigh.valid())
+				Genode::Signal_transmitter(_read_avail_sigh).submit();
+		}
+
+		/**
+		 * Flush internal read buffer into destination buffer
+		 */
+		Genode::size_t flush_read_buffer(char *dst, Genode::size_t dst_len)
+		{
+			Genode::size_t num_bytes = Genode::min(dst_len, _read_buf_bytes_used);
+			Genode::memcpy(dst, _read_buf, num_bytes);
+			_read_buf_bytes_used = 0;
+			return num_bytes;
+		}
+
+		/**
+		 * Return true if the internal read buffer is ready to receive data
+		 */
+		bool read_buffer_empty() const { return _read_buf_bytes_used == 0; }
+};
+
+
+namespace Terminal {
+
+	class Session_component : public Genode::Rpc_object<Session, Session_component>,
+	                          public Open_file
+	{
+		private:
+
+			Genode::Attached_ram_dataspace _io_buffer;
+
+		public:
+
+			Session_component(Genode::size_t io_buffer_size, const char *filename)
+			:
+				Open_file(filename),
+				_io_buffer(Genode::env()->ram_session(), io_buffer_size)
+			{ }
+
+			/********************************
+			 ** Terminal session interface **
+			 ********************************/
+
+			Size size() { return Size(0, 0); }
+
+			bool avail()
+			{
+				return !read_buffer_empty();
+			}
+
+			Genode::size_t _read(Genode::size_t dst_len)
+			{
+				Genode::size_t num_bytes =
+					flush_read_buffer(_io_buffer.local_addr<char>(),
+					                  Genode::min(_io_buffer.size(), dst_len));
+
+				return num_bytes;
+			}
+
+			void _write(Genode::size_t num_bytes)
+			{
+				/* sanitize argument */
+				num_bytes = Genode::min(num_bytes, _io_buffer.size());
+
+				/* write data to descriptor */
+				if (::write(fd(), _io_buffer.local_addr<char>(), num_bytes) < 0)
+					PERR("write error, dropping data");
+			}
+
+			Genode::Dataspace_capability _dataspace()
+			{
+				return _io_buffer.cap();
+			}
+
+			void read_avail_sigh(Genode::Signal_context_capability sigh)
+			{
+				Open_file::read_avail_sigh(sigh);
+			}
+
+			void connected_sigh(Genode::Signal_context_capability sigh)
+			{
+				Open_file::connected_sigh(sigh);
+			}
+
+			Genode::size_t read(void *buf, Genode::size_t) { return 0; }
+			Genode::size_t write(void const *buf, Genode::size_t) { return 0; }
+	};
+
+
+	class Root_component : public Genode::Root_component<Session_component>
+	{
+		protected:
+
+			Session_component *_create_session(const char *args)
+			{
+				Genode::size_t io_buffer_size = 4096;
+
+				try {
+					Genode::Session_label  label(args);
+					Genode::Session_policy policy(label);
+
+					char filename[256];
+					policy.attribute("filename").value(filename, sizeof(filename));
+
+					if (policy.has_attribute("io_buffer_size"))
+						policy.attribute("io_buffer_size").value(&io_buffer_size);
+
+					return new (md_alloc())
+					       Session_component(io_buffer_size, filename);
+
+				} catch (Genode::Xml_node::Nonexistent_attribute) {
+					PERR("Missing \"filename\" attribute in policy definition");
+					throw Genode::Root::Unavailable();
+				} catch (Genode::Session_policy::No_policy_defined) {
+					PERR("Invalid session request, no matching policy");
+					throw Genode::Root::Unavailable();
+				}
+			}
+
+		public:
+
+			/**
+			 * Constructor
+			 */
+			Root_component(Genode::Rpc_entrypoint *ep,
+			               Genode::Allocator      *md_alloc)
+			:
+				Genode::Root_component<Session_component>(ep, md_alloc)
+			{ }
+	};
+}
+
+
+int main()
+{
+	using namespace Genode;
+
+	Genode::printf("--- file terminal started ---\n");
+
+	/**
+	 * The stack needs to be that large because certain functions
+	 * in the libc (e.g. mktime(3)) require a huge stack.
+	 */
+	enum { STACK_SIZE = 16*sizeof(addr_t)*1024 };
+	static Cap_connection cap;
+	static Rpc_entrypoint ep(&cap, STACK_SIZE, "terminal_ep");
+
+	static Sliced_heap sliced_heap(env()->ram_session(), env()->rm_session());
+
+	/* create root interface for service */
+	static Terminal::Root_component root(&ep, &sliced_heap);
+
+	/* announce service at our parent */
+	env()->parent()->announce(ep.manage(&root));
+
+	Genode::sleep_forever();
+
+	return 0;
+}
diff --git a/gems/src/server/file_terminal/target.mk b/gems/src/server/file_terminal/target.mk
new file mode 100644
index 000000000..65eeea7a4
--- /dev/null
+++ b/gems/src/server/file_terminal/target.mk
@@ -0,0 +1,3 @@
+TARGET = file_terminal
+SRC_CC = main.cc
+LIBS   = libc libc_fs libc_log