diff --git a/docs/docsite/rst/intro_inventory.rst b/docs/docsite/rst/intro_inventory.rst
index 88ed1e4b3a2..cf3b103f91c 100644
--- a/docs/docsite/rst/intro_inventory.rst
+++ b/docs/docsite/rst/intro_inventory.rst
@@ -141,6 +141,15 @@ It is also possible to make groups of groups using the ``:children`` suffix. Jus
 If you need to store lists or hash data, or prefer to keep host and group specific variables
 separate from the inventory file, see the next section.
 
+.. _default_groups:
+
+Default groups
+++++++++++++++
+
+There are two default groups: ``all`` and ``ungrouped``. ``all`` contains every host.
+``ungrouped`` contains all hosts declared without an explicit section, even if they belong to
+another group.
+
 .. _splitting_out_vars:
 
 Splitting Out Host and Group Specific Data
diff --git a/test/units/inventory/test_inventory.py b/test/units/inventory/test_inventory.py
index 42f488aa372..ff763946504 100644
--- a/test/units/inventory/test_inventory.py
+++ b/test/units/inventory/test_inventory.py
@@ -22,9 +22,8 @@ __metaclass__ = type
 import string
 
 from ansible.compat.tests import unittest
-from ansible.compat.tests.mock import patch, MagicMock
+from ansible.compat.tests.mock import patch
 
-from ansible.errors import AnsibleError, AnsibleParserError
 from ansible.inventory import Inventory
 from ansible.inventory.expand_hosts import expand_hostname_range
 from ansible.vars import VariableManager
@@ -115,3 +114,60 @@ class TestInventory(unittest.TestCase):
         for e in self.ranges_to_expand:
             r = self.ranges_to_expand[e]
             self.assertEqual(r, expand_hostname_range(e))
+
+
+class InventoryDefaultGroup(unittest.TestCase):
+
+    def test_empty_inventory(self):
+        inventory = self._get_inventory('')
+
+        self.assertIn('all', inventory.groups)
+        self.assertIn('ungrouped', inventory.groups)
+        self.assertFalse(inventory.groups['all'].get_hosts())
+        self.assertFalse(inventory.groups['ungrouped'].get_hosts())
+
+    def test_ini(self):
+        self._test_default_groups("""
+            host1
+            host2
+            host3
+            [servers]
+            host3
+            host4
+            host5
+            """)
+
+    def test_ini_explicit_ungrouped(self):
+        self._test_default_groups("""
+            [ungrouped]
+            host1
+            host2
+            host3
+            [servers]
+            host3
+            host4
+            host5
+            """)
+
+    def _get_inventory(self, inventory_content):
+        v = VariableManager()
+
+        fake_loader = DictDataLoader({
+            'hosts': inventory_content
+        })
+
+        with patch.object(Inventory, 'basedir') as mock_basedir:
+            mock_basedir.return_value = './'
+            return Inventory(loader=fake_loader, variable_manager=v, host_list='hosts')
+
+    def _test_default_groups(self, inventory_content):
+        inventory = self._get_inventory(inventory_content)
+
+        self.assertIn('all', inventory.groups)
+        self.assertIn('ungrouped', inventory.groups)
+        all_hosts = set(host.name for host in inventory.groups['all'].get_hosts())
+        self.assertEqual(set(['host1', 'host2', 'host3', 'host4', 'host5']), all_hosts)
+        ungrouped_hosts = set(host.name for host in inventory.groups['ungrouped'].get_hosts())
+        self.assertEqual(set(['host1', 'host2', 'host3']), ungrouped_hosts)
+        servers_hosts = set(host.name for host in inventory.groups['servers'].get_hosts())
+        self.assertEqual(set(['host3', 'host4', 'host5']), servers_hosts)