diff --git a/karma.conf.js b/karma.conf.js
index 901832c7..b0a48c92 100644
--- a/karma.conf.js
+++ b/karma.conf.js
@@ -2,13 +2,14 @@
 
 var path = require('path');
 var webpack = require('webpack');
+var webpack_config = require('./webpack.config');
 
 /*
  * We use webpack to build our tests. It's a pain to have to wait for webpack
  * to build everything; however it's the easiest way to load our dependencies
  * from node_modules.
  *
- * If you run karma in multi-run mode (with `npm run test:multi`), it will watch
+ * If you run karma in multi-run mode (with `npm run test-multi`), it will watch
  * the tests for changes, and webpack will rebuild using a cache. This is much quicker
  * than a clean rebuild.
  */
@@ -19,8 +20,41 @@ var testFile = process.env.KARMA_TEST_FILE || 'test/all-tests.js';
 process.env.PHANTOMJS_BIN = 'node_modules/.bin/phantomjs';
 process.env.Q_DEBUG = 1;
 
+/* the webpack config is based on the real one, to (a) try to simulate the
+ * deployed environment as closely as possible, and (b) to avoid a shedload of
+ * cut-and-paste.
+ */
+
+// find out if we're shipping olm, and where it is, if so.
+const olm_entry = webpack_config.entry['olm'];
+
+// remove the default entries - karma provides its own (via the 'files' and
+// 'preprocessors' config below)
+delete webpack_config['entry'];
+
+// add ./test as a search path for js
+webpack_config.module.loaders.unshift({
+    test: /\.js$/, loader: "babel",
+    include: [path.resolve('./src'), path.resolve('./test')],
+});
+
+// disable parsing for sinon, because it
+// tries to do voodoo with 'require' which upsets
+// webpack (https://github.com/webpack/webpack/issues/304)
+webpack_config.module.noParse.push(/sinon\/pkg\/sinon\.js$/);
+
+// ?
+webpack_config.resolve.alias['sinon'] = 'sinon/pkg/sinon.js';
+
+webpack_config.resolve.root = [
+    path.resolve('./src'),
+    path.resolve('./test'),
+];
+
+webpack_config.devtool = 'inline-source-map';
+
 module.exports = function (config) {
-    config.set({
+    const myconfig = {
         // frameworks to use
         // available frameworks: https://npmjs.org/browse/keyword/karma-adapter
         frameworks: ['mocha'],
@@ -51,7 +85,7 @@ module.exports = function (config) {
         // available preprocessors:
         // https://npmjs.org/browse/keyword/karma-preprocessor
         preprocessors: {
-            'test/**/*.js': ['webpack', 'sourcemap']
+            '{src,test}/**/*.js': ['webpack'],
         },
 
         // test results reporter to use
@@ -94,59 +128,20 @@ module.exports = function (config) {
             outputDir: 'karma-reports',
         },
 
-        webpack: {
-            module: {
-                preLoaders: [
-                    // use the source-map-loader for javascript. This means
-                    // that we have a better chance of seeing line numbers from
-                    // the pre-babeled source.
-                    { test: /\.js$/, loader: "source-map-loader" },
-                ],
-                loaders: [
-                    { test: /\.json$/, loader: "json" },
-                    {
-                        test: /\.js$/, loader: "babel",
-                        include: [path.resolve('./src'),
-                                  path.resolve('./test'),
-                                 ]
-                    },
-                ],
-                noParse: [
-                    // don't parse the languages within highlight.js. They
-                    // cause stack overflows
-                    // (https://github.com/webpack/webpack/issues/1721), and
-                    // there is no need for webpack to parse them - they can
-                    // just be included as-is.
-                    /highlight\.js\/lib\/languages/,
+        webpack: webpack_config,
 
-                    // also disable parsing for sinon, because it
-                    // tries to do voodoo with 'require' which upsets
-                    // webpack (https://github.com/webpack/webpack/issues/304)
-                    /sinon\/pkg\/sinon\.js$/,
-                ],
+        webpackMiddleware: {
+            stats: {
+                // don't fill the console up with a mahoosive list of modules
+                chunks: false,
             },
-            resolve: {
-                alias: {
-                    // alias any requires to the react module to the one in our path, otherwise
-                    // we tend to get the react source included twice when using npm link.
-                    react: path.resolve('./node_modules/react'),
-
-                    // same goes for js-sdk
-                    "matrix-js-sdk": path.resolve('./node_modules/matrix-js-sdk'),
-
-                    sinon: 'sinon/pkg/sinon.js',
-                },
-                root: [
-                    path.resolve('./src'),
-                    path.resolve('./test'),
-                ],
-            },
-            plugins: [
-                // olm may not be installed, so avoid webpack warnings by
-                // ignoring it.
-                new webpack.IgnorePlugin(/^olm$/),
-            ],
-            devtool: 'inline-source-map',
         },
-    });
+    };
+
+    // include the olm loader if we have it.
+    if (olm_entry) {
+        myconfig.files.unshift(olm_entry);
+    }
+
+    config.set(myconfig);
 };
diff --git a/package.json b/package.json
index 915056e6..d48eaffe 100644
--- a/package.json
+++ b/package.json
@@ -46,7 +46,7 @@
     "clean": "rimraf lib webapp electron/dist",
     "prepublish": "npm run build:compile",
     "test": "karma start --single-run=true --autoWatch=false --browsers PhantomJS --colors=false",
-    "test:multi": "karma start"
+    "test-multi": "karma start"
   },
   "dependencies": {
     "babel-polyfill": "^6.5.0",
@@ -111,7 +111,6 @@
     "karma-junit-reporter": "^0.4.1",
     "karma-mocha": "^0.2.2",
     "karma-phantomjs-launcher": "^1.0.0",
-    "karma-sourcemap-loader": "^0.3.7",
     "karma-webpack": "^1.7.0",
     "minimist": "^1.2.0",
     "mkdirp": "^0.5.1",