diff --git a/moto/s3/models.py b/moto/s3/models.py
index 76cfb6b6..7b3f7877 100644
--- a/moto/s3/models.py
+++ b/moto/s3/models.py
@@ -14,10 +14,11 @@ UPLOAD_PART_MIN_SIZE = 5242880
 
 
 class FakeKey(object):
-    def __init__(self, name, value):
+    def __init__(self, name, value, storage=None):
         self.name = name
         self.value = value
         self.last_modified = datetime.datetime.now()
+        self._storage_class = storage
         self._metadata = {}
 
     def copy(self, new_name = None):
@@ -32,6 +33,9 @@ class FakeKey(object):
     def clear_metadata(self):
         self._metadata = {}
 
+    def set_storage_class(self, storage_class):
+        self._storage_class = storage_class
+
     def append_to_value(self, value):
         self.value += value
         self.last_modified = datetime.datetime.now()
@@ -58,15 +62,27 @@ class FakeKey(object):
 
     @property
     def response_dict(self):
-        return {
+        r = {
             'etag': self.etag,
             'last-modified': self.last_modified_RFC1123,
         }
+        if self._storage_class is not None:
+            if self._storage_class != 'STANDARD':
+                r['x-amz-storage-class'] = self._storage_class
+
+        return r
 
     @property
     def size(self):
         return len(self.value)
 
+    @property
+    def storage_class(self):
+        if self._storage_class is not None:
+            return self._storage_class
+        else:
+            return 'STANDARD'
+
 
 class FakeMultipart(object):
     def __init__(self, key_name):
@@ -140,11 +156,12 @@ class S3Backend(BaseBackend):
                 return self.buckets.pop(bucket_name)
         return None
 
-    def set_key(self, bucket_name, key_name, value):
+    def set_key(self, bucket_name, key_name, value, storage=None):
         key_name = clean_key_name(key_name)
 
         bucket = self.buckets[bucket_name]
-        new_key = FakeKey(name=key_name, value=value)
+        new_key = FakeKey(name=key_name, value=value,
+                          storage=storage)
         bucket.keys[key_name] = new_key
 
         return new_key
@@ -231,7 +248,7 @@ class S3Backend(BaseBackend):
         bucket = self.buckets[bucket_name]
         return bucket.keys.pop(key_name)
 
-    def copy_key(self, src_bucket_name, src_key_name, dest_bucket_name, dest_key_name):
+    def copy_key(self, src_bucket_name, src_key_name, dest_bucket_name, dest_key_name, storage=None):
         src_key_name = clean_key_name(src_key_name)
         dest_key_name = clean_key_name(dest_key_name)
         src_bucket = self.buckets[src_bucket_name]
@@ -240,5 +257,7 @@ class S3Backend(BaseBackend):
         if dest_key_name != src_key_name:
             key = key.copy(dest_key_name)
         dest_bucket.keys[dest_key_name] = key
+        if storage is not None:
+            dest_bucket.keys[dest_key_name].set_storage_class(storage)
 
 s3_backend = S3Backend()
diff --git a/moto/s3/responses.py b/moto/s3/responses.py
index 998d1e30..a0ee1fd1 100644
--- a/moto/s3/responses.py
+++ b/moto/s3/responses.py
@@ -190,10 +190,13 @@ class ResponseObject(object):
                 headers.update(key.response_dict)
                 return 200, headers, response
 
+            storage_class = request.headers.get('x-amz-storage-class', 'STANDARD')
+
             if 'x-amz-copy-source' in request.headers:
                 # Copy key
                 src_bucket, src_key = request.headers.get("x-amz-copy-source").split("/", 1)
-                self.backend.copy_key(src_bucket, src_key, bucket_name, key_name)
+                self.backend.copy_key(src_bucket, src_key, bucket_name, key_name,
+                                      storage=storage_class)
                 mdirective = request.headers.get('x-amz-metadata-directive')
                 if mdirective is not None and mdirective == 'REPLACE':
                     new_key = self.backend.get_key(bucket_name, key_name)
@@ -210,7 +213,8 @@ class ResponseObject(object):
                 new_key = self.backend.append_to_key(bucket_name, key_name, body)
             else:
                 # Initial data
-                new_key = self.backend.set_key(bucket_name, key_name, body)
+                new_key = self.backend.set_key(bucket_name, key_name, body,
+                                               storage=storage_class)
                 request.streaming = True
                 self._key_set_metadata(request, new_key)
 
@@ -292,12 +296,11 @@ S3_BUCKET_GET_RESPONSE = """<?xml version="1.0" encoding="UTF-8"?>
       <LastModified>{{ key.last_modified_ISO8601 }}</LastModified>
       <ETag>{{ key.etag }}</ETag>
       <Size>{{ key.size }}</Size>
-      <StorageClass>STANDARD</StorageClass>
+      <StorageClass>{{ key.storage_class }}</StorageClass>
       <Owner>
         <ID>75aa57f09aa0c8caeab4f8c24e99d10f8e7faeebf76c078efc7c6caea54ba06a</ID>
         <DisplayName>webfile</DisplayName>
       </Owner>
-      <StorageClass>STANDARD</StorageClass>
     </Contents>
   {% endfor %}
   {% if delimiter %}
diff --git a/tests/test_s3/test_s3.py b/tests/test_s3/test_s3.py
index b39bd6cb..e72c8e51 100644
--- a/tests/test_s3/test_s3.py
+++ b/tests/test_s3/test_s3.py
@@ -326,3 +326,32 @@ def test_bucket_key_listing_order():
     delimiter = '/'
     keys = [x.name for x in bucket.list(prefix + 'x', delimiter)]
     keys.should.equal([u'toplevel/x/'])
+
+
+@mock_s3
+def test_key_with_reduced_redundancy():
+    conn = boto.connect_s3()
+    bucket = conn.create_bucket('test_bucket_name')
+
+    key = Key(bucket, 'test_rr_key')
+    key.set_contents_from_string('value1', reduced_redundancy=True)
+    # we use the bucket iterator because of:
+    # https:/github.com/boto/boto/issues/1173
+    list(bucket)[0].storage_class.should.equal('REDUCED_REDUNDANCY')
+
+
+@mock_s3
+def test_copy_key_reduced_redundancy():
+    conn = boto.connect_s3('the_key', 'the_secret')
+    bucket = conn.create_bucket("foobar")
+    key = Key(bucket)
+    key.key = "the-key"
+    key.set_contents_from_string("some value")
+
+    bucket.copy_key('new-key', 'foobar', 'the-key', storage_class='REDUCED_REDUNDANCY')
+
+    # we use the bucket iterator because of:
+    # https:/github.com/boto/boto/issues/1173
+    keys = dict([(k.name, k) for k in bucket])
+    keys['new-key'].storage_class.should.equal("REDUCED_REDUNDANCY")
+    keys['the-key'].storage_class.should.equal("STANDARD")