diff --git a/moto/ec2/models.py b/moto/ec2/models.py
index 95903b82..20d5af1c 100644
--- a/moto/ec2/models.py
+++ b/moto/ec2/models.py
@@ -1,4 +1,5 @@
 import copy
+import itertools
 from collections import defaultdict
 
 from boto.ec2.instance import Instance as BotoInstance, Reservation
@@ -312,36 +313,36 @@ class SecurityGroup(object):
 class SecurityGroupBackend(object):
 
     def __init__(self):
-        self.groups = {}
-        self.vpc_groups = {}
-
+        # the key in the dict group is the vpc_id or None (non-vpc)
+        self.groups = defaultdict(dict)
         super(SecurityGroupBackend, self).__init__()
 
     def create_security_group(self, name, description, vpc_id=None, force=False):
         group_id = random_security_group_id()
         if not force:
-            existing_group = self.get_security_group_from_name(name)
+            existing_group = self.get_security_group_from_name(name, vpc_id)
             if existing_group:
                 return None
         group = SecurityGroup(group_id, name, description, vpc_id=vpc_id)
-        self.groups[group_id] = group
+
+        self.groups[vpc_id][group_id] = group
         return group
 
     def describe_security_groups(self):
-        return self.groups.values()
+        return itertools.chain(*[x.values() for x in self.groups.values()])
 
-    def delete_security_group(self, name_or_group_id):
-        if name_or_group_id in self.groups:
+    def delete_security_group(self, name_or_group_id, vpc_id):
+        if name_or_group_id in self.groups[vpc_id]:
             # Group Id
-            return self.groups.pop(name_or_group_id)
+            return self.groups[vpc_id].pop(name_or_group_id)
         else:
             # Group Name
-            group = self.get_security_group_from_name(name_or_group_id)
+            group = self.get_security_group_from_name(name_or_group_id, vpc_id)
             if group:
-                return self.groups.pop(group.id)
+                return self.groups[vpc_id].pop(group.id)
 
-    def get_security_group_from_name(self, name):
-        for group_id, group in self.groups.iteritems():
+    def get_security_group_from_name(self, name, vpc_id):
+        for group_id, group in self.groups[vpc_id].iteritems():
             if group.name == name:
                 return group
 
@@ -350,16 +351,16 @@ class SecurityGroupBackend(object):
             default_group = ec2_backend.create_security_group("default", "The default security group", force=True)
             return default_group
 
-    def authorize_security_group_ingress(self, group_name, ip_protocol, from_port, to_port, ip_ranges=None, source_group_names=None):
-        group = self.get_security_group_from_name(group_name)
+    def authorize_security_group_ingress(self, group_name, ip_protocol, from_port, to_port, ip_ranges=None, source_group_names=None, vpc_id=None):
+        group = self.get_security_group_from_name(group_name, vpc_id)
         source_groups = []
         for source_group_name in source_group_names:
-            source_groups.append(self.get_security_group_from_name(source_group_name))
+            source_groups.append(self.get_security_group_from_name(source_group_name, vpc_id))
 
         security_rule = SecurityRule(ip_protocol, from_port, to_port, ip_ranges, source_groups)
         group.ingress_rules.append(security_rule)
 
-    def revoke_security_group_ingress(self, group_name, ip_protocol, from_port, to_port, ip_ranges=None, source_group_names=None):
+    def revoke_security_group_ingress(self, group_name, ip_protocol, from_port, to_port, ip_ranges=None, source_group_names=None, vpc_id=None):
         group = self.get_security_group_from_name(group_name)
         source_groups = []
         for source_group_name in source_group_names:
diff --git a/tests/test_ec2/test_security_groups.py b/tests/test_ec2/test_security_groups.py
index 606faebc..6b33c360 100644
--- a/tests/test_ec2/test_security_groups.py
+++ b/tests/test_ec2/test_security_groups.py
@@ -31,8 +31,8 @@ def test_create_and_describe_vpc_security_group():
     security_group.name.should.equal('test security group')
     security_group.description.should.equal('this is a test security group')
 
-    # Trying to create another group with the same name should throw an error
-    conn.create_security_group.when.called_with('test security group', 'this is a test security group').should.throw(EC2ResponseError)
+    # Trying to create another group with the same name in the same VPC should throw an error
+    conn.create_security_group.when.called_with('test security group', 'this is a test security group', vpc_id).should.throw(EC2ResponseError)
 
     all_groups = conn.get_all_security_groups()
 
@@ -41,6 +41,21 @@ def test_create_and_describe_vpc_security_group():
     all_groups.should.have.length_of(1)
     all_groups[0].name.should.equal('test security group')
 
+@mock_ec2
+def test_create_two_security_groups_with_same_name_in_different_vpc():
+    conn = boto.connect_ec2('the_key', 'the_secret')
+    vpc_id = 'vpc-5300000c'
+    vpc_id2 = 'vpc-5300000d'
+
+    sg1 = conn.create_security_group('test security group', 'this is a test security group', vpc_id)
+    sg2 = conn.create_security_group('test security group', 'this is a test security group', vpc_id2)
+
+    all_groups = conn.get_all_security_groups()
+
+    all_groups.should.have.length_of(2)
+    all_groups[0].name.should.equal('test security group')
+    all_groups[1].name.should.equal('test security group')
+
 
 @mock_ec2
 def test_deleting_security_groups():