diff --git a/Makefile b/Makefile
index f421873..aaa7c29 100644
--- a/Makefile
+++ b/Makefile
@@ -103,50 +103,15 @@ TPT=third_party.zip.d.tmp
 third_party:
 	make -C third_party
 
-third_party.zip.d: third_party third_party.paths
-	@echo "Generating a third_party.zip dependency file."
-	@echo "THIRD_PARTY_files=\\" > $(TPT).files
-	@echo 'third_party.zip: third_party.zip.d $$(THIRD_PARTY_here)' > $(TPT).target
-	@echo '	@echo Changed files: $$?' >> $(TPT).target
-	@cd third_party; \
-	 cat ../third_party.paths | grep ^third_party.zip | sed -e's-third_party.zip/--' | (while read LINE; do \
-		PREFIX=$${LINE%% *}; \
-		for SUFFIX in $${LINE#* }; do \
-			find $$PREFIX/$$SUFFIX $(FINDARGS) >> ../$(TPT).files; \
-			echo "	cd $(CURDIR)/third_party/$$PREFIX; zip -r $(CURDIR)/third_party.zip \\" >> ../$(TPT).target; \
-			(cd $$PREFIX; find $$SUFFIX $(FINDARGS)) >> ../$(TPT).target; \
-			echo "	" >> ../$(TPT).target; \
-		done; \
-	 done)
-	@echo '' >> $(TPT).files
-	@echo 'THIRD_PARTY_here=$$(addprefix third_party/,$$(THIRD_PARTY_files)) ' >> $(TPT).files
-	@echo '' >> $(TPT).files
-	
-	@echo '' > $(TPT)
-	@cat $(TPT).files >> $(TPT)
-	@cat $(TPT).target >> $(TPT)
-	
-	@if [ ! -e $@ ]; then touch $@; fi
-	@if [ `${MD5SUM} $@ | sed -e's/ .*//'` != `${MD5SUM} $(TPT) | sed -e's/ .*//'` ]; then \
-		echo "third_party.zip.d has changed!"; \
-		mv $(TPT) $@; \
-	else \
-		echo "third_party.zip.d has not changed!"; \
-	fi
-	@rm $(TPT)*
-
-
-include third_party.zip.d
-
 ###############################################################################
 ###############################################################################
 
 upload: update
 deploy: update
-update: third_party.zip
+update:
 	${APPENGINE_SDK}/appcfg.py update .
 
-serve: third_party.zip
+serve:
 	${APPENGINE_SDK}/dev_appserver.py -a 0.0.0.0 -d --enable_sendmail .
 
 clean:
diff --git a/app.yaml b/app.yaml
index 890efda..7ed5eb3 100644
--- a/app.yaml
+++ b/app.yaml
@@ -40,10 +40,9 @@ handlers:
   script: handler.py
 
 skip_files:
-- third_party/((?!(aeoid|python-gae-pytz)).*)/
-- third_party/python-gae-pytz/(?!pytz)
 - third_party/aeoid/demo
 - third_party/mkzip
+- third_party/python-markdown/tests
 - (.*/)*.git/
 - .*/\..*
 - .*/README
diff --git a/config.py b/config.py
index 5d566bc..08d1860 100644
--- a/config.py
+++ b/config.py
@@ -34,7 +34,6 @@ def sys_path_insert(ipath):
     if ipath not in sys.path:
         sys.path.insert(0, ipath)
 
-
 def setup_django():
     """Setup the django settings."""
     os.environ['DJANGO_SETTINGS_MODULE'] = 'settings'
@@ -52,10 +51,8 @@ def setup(host=None):
             HOST = host
 
     # Add our extra modules to sys.path
-    sys_path_insert('third_party.zip')
+    sys_path_insert('third_party')
     for ipath in getpaths():
-        if 'third_party.zip' in ipath:
-            continue
         sys_path_insert(ipath)
 
     setup_django()
@@ -70,9 +67,6 @@ def lint_setup():
     print "APPENGINE_SDK at ", os.environ["APPENGINE_SDK"]
     sys_path_insert(os.environ["APPENGINE_SDK"])
 
-    for ipath in getpaths():
-        sys_path_insert(ipath.replace('.zip', ''))
-
     setup_django()
 
 if __name__ == "__main__":
diff --git a/third_party.paths b/third_party.paths
index 33d934f..5dfe956 100644
--- a/third_party.paths
+++ b/third_party.paths
@@ -1,9 +1,9 @@
 third_party/aeoid
 third_party/python-gae-pytz
 # Directory to add to sys.path, things to include in third_party.zip
-third_party.zip/python-dateutil dateutil
-third_party.zip/python-datetime-tz datetime_tz.py pytz_abbr.py
-third_party.zip/python-markdown markdown
-third_party.zip/python-markdown-extensions markdown
-third_party.zip/python-pyrss2gen PyRSS2Gen.py
-third_party.zip/python-vobject vobject
+third_party/python-dateutil dateutil
+third_party/python-datetime-tz datetime_tz.py pytz_abbr.py
+third_party/python-markdown markdown
+third_party/python-markdown-extensions markdown
+third_party/python-pyrss2gen PyRSS2Gen.py
+third_party/python-vobject vobject