diff --git a/core/includes/common.inc b/core/includes/common.inc
index 14e4357..cb9beef 100644
--- a/core/includes/common.inc
+++ b/core/includes/common.inc
@@ -5769,7 +5769,7 @@ function drupal_render_cache_set(&$markup, $elements) {
   }
   $bin = isset($elements['#cache']['bin']) ? $elements['#cache']['bin'] : 'cache';
   $expire = isset($elements['#cache']['expire']) ? $elements['#cache']['expire'] : CacheBackendInterface::CACHE_PERMANENT;
-  $tags = isset($elements['#cache']['tags']) ? $elements['#cache']['tags'] : array();
+  $tags = drupal_render_collect_cache_tags($elements, TRUE);
   cache($bin)->set($cid, $data, $expire, $tags);
 }
 
@@ -5817,6 +5817,57 @@ function drupal_render_collect_attached($elements, $return = FALSE) {
 }
 
 /**
+ * Collects cache tags for an element and its children into a single array.
+ *
+ * When caching elements, it is necessary to collect all cache tags into a
+ * single array, from both the element itself and all child elements. This
+ * allows items to be invalidated based on all tags attached to the content
+ * they're constituted from.
+ *
+ * @param array $elements
+ *   The element to collect cache tags from.
+ * @param bool $return
+ *   Whether to return the attached elements and reset the internal static.
+ *
+ * @return array
+ *   The cache tags array for this element and its descendants.
+ */
+function drupal_render_collect_cache_tags($elements, $return = FALSE) {
+  $tags = &drupal_static(__FUNCTION__, array());
+
+  // Collect all cache tags for this element.
+  if (isset($elements['#cache']['tags'])) {
+    foreach ($elements['#cache']['tags'] as $namespace => $values) {
+      if (is_array($values)) {
+        foreach ($values as $value) {
+          if (!isset($tags[$namespace][$value])) {
+            $tags[$namespace][$value] = $value;
+          }
+        }
+      }
+      else {
+        if (!isset($tags[$namespace])) {
+          $tags[$namespace] = $values;
+        }
+      }
+    }
+  }
+  if ($children = element_children($elements)) {
+    foreach ($children as $child) {
+      drupal_render_collect_cache_tags($elements[$child]);
+    }
+  }
+
+  // If this was the first call to the function, return all attached elements
+  // and reset the static cache.
+  if ($return) {
+    $return = $tags;
+    $tags = array();
+    return $return;
+  }
+}
+
+/**
  * Prepares an element for caching based on a query.
  *
  * This smart caching strategy saves Drupal from querying and rendering to HTML
diff --git a/core/includes/entity.inc b/core/includes/entity.inc
index 37fb310..acc5b65 100644
--- a/core/includes/entity.inc
+++ b/core/includes/entity.inc
@@ -105,9 +105,13 @@ function entity_get_view_modes($entity_type = NULL) {
     else {
       $view_modes = module_invoke_all('entity_view_mode_info');
       foreach ($view_modes as $type => $entity_info) {
+        $view_modes[$type] += array(
+          'cache_default' => TRUE,
+        );
         foreach ($entity_info as $view_mode => $view_mode_info) {
           $view_modes[$type][$view_mode] += array(
             'custom_settings' => FALSE,
+            'cache' => TRUE,
           );
         }
       }
@@ -588,14 +592,19 @@ function entity_render_controller($entity_type) {
  * @param string $langcode
  *   (optional) For which language the entity should be rendered, defaults to
  *   the current content language.
+ * @param bool $reset
+ *   (optional) Whether to reset the render cache for the requested entity.
+ *   Defaults to FALSE.
  *
  * @return array
  *   A render array for the entity.
  */
-function entity_view(EntityInterface $entity, $view_mode, $langcode = NULL) {
-  return drupal_container()->get('plugin.manager.entity')
-    ->getRenderController($entity->entityType())
-    ->view($entity, $view_mode, $langcode);
+function entity_view(EntityInterface $entity, $view_mode, $langcode = NULL, $reset = FALSE) {
+  $render_controller = drupal_container()->get('plugin.manager.entity')->getRenderController($entity->entityType());
+  if ($reset) {
+    $render_controller->resetCache(array($entity));
+  }
+  return $render_controller->view($entity, $view_mode, $langcode);
 }
 
 /**
@@ -608,15 +617,20 @@ function entity_view(EntityInterface $entity, $view_mode, $langcode = NULL) {
  * @param string $langcode
  *   (optional) For which language the entity should be rendered, defaults to
  *   the current content language.
+ * @param bool $reset
+ *   (optional) Whether to reset the render cache for the requested entities.
+ *   Defaults to FALSE.
  *
  * @return array
  *   A render array for the entities, indexed by the same keys as the
  *   entities array passed in $entities.
  */
-function entity_view_multiple(array $entities, $view_mode, $langcode = NULL) {
-  return drupal_container()->get('plugin.manager.entity')
-    ->getRenderController(reset($entities)->entityType())
-    ->viewMultiple($entities, $view_mode, $langcode);
+function entity_view_multiple(array $entities, $view_mode, $langcode = NULL, $reset = FALSE) {
+  $render_controller = drupal_container()->get('plugin.manager.entity')->getRenderController(reset($entities)->entityType());
+  if ($reset) {
+    $render_controller->resetCache($entities);
+  }
+  return $render_controller->viewMultiple($entities, $view_mode, $langcode);
 }
 
 /**
diff --git a/core/lib/Drupal/Core/Entity/DatabaseStorageController.php b/core/lib/Drupal/Core/Entity/DatabaseStorageController.php
index 9092a13..face9db 100644
--- a/core/lib/Drupal/Core/Entity/DatabaseStorageController.php
+++ b/core/lib/Drupal/Core/Entity/DatabaseStorageController.php
@@ -169,6 +169,21 @@ public function resetCache(array $ids = NULL) {
   }
 
   /**
+   * Resets the entity render cache.
+   *
+   * @param array|null $entities
+   *   (optional) If specified, the cache is reset for the given entities only.
+   */
+  protected function resetRenderCache(array $entities = NULL) {
+    try {
+      drupal_container()->get('plugin.manager.entity')->getRenderController($this->entityType)->resetCache($entities);
+    }
+    catch (\Exception $e) {
+      // Nothing to do if the entity type doesn't have a render controller.
+    }
+  }
+
+  /**
    * Implements \Drupal\Core\Entity\EntityStorageControllerInterface::load().
    */
   public function load(array $ids = NULL) {
@@ -529,6 +544,9 @@ public function save(EntityInterface $entity) {
           $this->saveRevision($entity);
         }
         $this->resetCache(array($entity->id()));
+        // Reset the render cache as well.
+        $this->resetRenderCache(array($entity));
+
         $this->postSave($entity, TRUE);
         $this->invokeHook('update', $entity);
       }
@@ -539,6 +557,8 @@ public function save(EntityInterface $entity) {
         }
         // Reset general caches, but keep caches specific to certain entities.
         $this->resetCache(array());
+        // Reset the render cache as well.
+        $this->resetRenderCache(array($entity));
 
         $entity->enforceIsNew(FALSE);
         $this->postSave($entity, FALSE);
diff --git a/core/lib/Drupal/Core/Entity/DatabaseStorageControllerNG.php b/core/lib/Drupal/Core/Entity/DatabaseStorageControllerNG.php
index e8998f8..031edb8 100644
--- a/core/lib/Drupal/Core/Entity/DatabaseStorageControllerNG.php
+++ b/core/lib/Drupal/Core/Entity/DatabaseStorageControllerNG.php
@@ -297,6 +297,9 @@ public function save(EntityInterface $entity) {
           $this->savePropertyData($entity);
         }
         $this->resetCache(array($entity->id()));
+        // Reset the render cache as well.
+        $this->resetRenderCache(array($entity));
+
         $this->postSave($entity, TRUE);
         $this->invokeHook('update', $entity);
       }
@@ -313,6 +316,8 @@ public function save(EntityInterface $entity) {
 
         // Reset general caches, but keep caches specific to certain entities.
         $this->resetCache(array());
+        // Reset the render cache as well.
+        $this->resetRenderCache(array($entity));
 
         $entity->enforceIsNew(FALSE);
         $this->postSave($entity, FALSE);
diff --git a/core/lib/Drupal/Core/Entity/EntityRenderController.php b/core/lib/Drupal/Core/Entity/EntityRenderController.php
index 53457aa..a7297bf 100644
--- a/core/lib/Drupal/Core/Entity/EntityRenderController.php
+++ b/core/lib/Drupal/Core/Entity/EntityRenderController.php
@@ -20,8 +20,27 @@ class EntityRenderController implements EntityRenderControllerInterface {
    */
   protected $entityType;
 
+  /**
+   * An array of view mode info for the type of entities for which this
+   * controller is instantiated.
+   *
+   * @var array
+   */
+  protected $viewModesInfo;
+
+  /**
+   * The cache bin used to store the render cache.
+   *
+   * @todo Defaults to 'cache' for now, until http://drupal.org/node/1194136 is
+   * fixed.
+   *
+   * @var string
+   */
+  protected $cacheBin = 'cache';
+
   public function __construct($entity_type) {
     $this->entityType = $entity_type;
+    $this->viewModesInfo = entity_get_view_modes($entity_type);
   }
 
   /**
@@ -156,10 +175,54 @@ public function viewMultiple(array $entities = array(), $view_mode = 'full', $la
 
       $build[$key]['#weight'] = $weight++;
 
+      // Cache the rendered output if permitted by the view mode settings.
+      if ((!isset($this->viewModesInfo[$view_mode]) && $this->viewModesInfo['cache_default']) || $this->viewModesInfo[$view_mode]['cache']) {
+        $build[$key]['#cache'] = array(
+          'keys' => array('entity_view', $this->entityType ,$entity->id(), $view_mode),
+          'granularity' => DRUPAL_CACHE_PER_ROLE,
+          'bin' => $this->cacheBin,
+          'tags' => array(
+            $this->entityType . '_view' => TRUE,
+            $this->entityType => array($entity->id()),
+          ),
+        );
+      }
+
       // Allow modules to modify the render array.
       drupal_alter(array($view_hook, 'entity_view'), $build[$key], $entity, $display);
     }
 
     return $build;
   }
+
+  /**
+   * Implements \Drupal\Core\Entity\EntityRenderControllerInterface::resetCache().
+   */
+  public function resetCache(array $entities = NULL) {
+    if (isset($entities)) {
+      $tags = array();
+      foreach ($entities as $entity) {
+        $tags[$this->entityType][] = $entity->id();
+
+        // @todo Remove when all entities are converted to EntityNG.
+        if (!$entity->getPropertyDefinitions()) {
+          continue;
+        }
+
+        // Add all the referenced entity types and IDs to the tags that will be
+        // cleared.
+        foreach ($entity->getPropertyDefinitions() as $name => $definition) {
+          if ($definition['type'] == 'entity_reference_field') {
+            foreach ($entity->$name->getValue() as $target_id) {
+              $tags[$definition['settings']['target_type']][$target_id] = $target_id;
+            }
+          }
+        }
+      }
+      cache($this->cacheBin)->deleteTags($tags);
+    }
+    else {
+      cache($this->cacheBin)->deleteTags(array($this->entityType . '_view' => TRUE));
+    }
+  }
 }
diff --git a/core/lib/Drupal/Core/Entity/EntityRenderControllerInterface.php b/core/lib/Drupal/Core/Entity/EntityRenderControllerInterface.php
index 03ba014..88e1461 100644
--- a/core/lib/Drupal/Core/Entity/EntityRenderControllerInterface.php
+++ b/core/lib/Drupal/Core/Entity/EntityRenderControllerInterface.php
@@ -75,4 +75,12 @@ public function view(EntityInterface $entity, $view_mode = 'full', $langcode = N
    *   be available for loading.
    */
   public function viewMultiple(array $entities = array(), $view_mode = 'full', $langcode = NULL);
+
+  /**
+   * Resets the entity render cache.
+   *
+   * @param array|null $entities
+   *   (optional) If specified, the cache is reset for the given entities only.
+   */
+  public function resetCache(array $entities = NULL);
 }
diff --git a/core/modules/block/lib/Drupal/block/BlockRenderController.php b/core/modules/block/lib/Drupal/block/BlockRenderController.php
index e705310..0f73347 100644
--- a/core/modules/block/lib/Drupal/block/BlockRenderController.php
+++ b/core/modules/block/lib/Drupal/block/BlockRenderController.php
@@ -87,4 +87,10 @@ public function viewMultiple(array $entities = array(), $view_mode = 'full', $la
     return $build;
   }
 
+  /**
+   * Implements \Drupal\Core\Entity\EntityRenderControllerInterface::resetCache().
+   */
+  public function resetCache(array $entities = NULL) {
+    // @todo Move block render caching logic to this controller?
+  }
 }
diff --git a/core/modules/entity/lib/Drupal/entity/Plugin/Core/Entity/EntityDisplay.php b/core/modules/entity/lib/Drupal/entity/Plugin/Core/Entity/EntityDisplay.php
index 9048788..40774da 100644
--- a/core/modules/entity/lib/Drupal/entity/Plugin/Core/Entity/EntityDisplay.php
+++ b/core/modules/entity/lib/Drupal/entity/Plugin/Core/Entity/EntityDisplay.php
@@ -117,7 +117,12 @@ public function save() {
     if (empty($this->id)) {
       $this->id = $this->id();
     }
-    return parent::save();
+    $return = parent::save();
+
+    // Reset the render cache for the target entity type.
+    drupal_container()->get('plugin.manager.entity')->getRenderController($this->targetEntityType)->resetCache();
+
+    return $return;
   }
 
   /**
diff --git a/core/modules/user/lib/Drupal/user/Tests/UserSignatureTest.php b/core/modules/user/lib/Drupal/user/Tests/UserSignatureTest.php
index 31f01b9..41800dc 100644
--- a/core/modules/user/lib/Drupal/user/Tests/UserSignatureTest.php
+++ b/core/modules/user/lib/Drupal/user/Tests/UserSignatureTest.php
@@ -112,6 +112,9 @@ function testUserSignature() {
     $edit['comment_body[' . $langcode . '][0][format]'] = $this->full_html_format->format;
     $this->drupalPost('comment/' . $comment_id . '/edit', $edit, t('Save'));
 
+    // @todo Temporary cache clear.
+    drupal_container()->get('plugin.manager.entity')->getRenderController('node')->resetCache(array($node));
+
     // Assert that the signature did not make it through unfiltered.
     $this->drupalGet('node/' . $node->nid);
     $this->assertNoRaw($signature_text, 'Unfiltered signature text not found.');