diff --git a/activerecord/CHANGELOG.md b/activerecord/CHANGELOG.md
index 10bfe1945ad980c317a6dc3cf3a61fef2b62f880..d759b26c65535df6ca3ede0c6fbfc8a98fc6913a 100644
--- a/activerecord/CHANGELOG.md
+++ b/activerecord/CHANGELOG.md
@@ -1,5 +1,44 @@
 ## Rails 4.0.0 (unreleased) ##
 
+*   Improve the derivation of HABTM join table name to take account of nesting.
+    It now takes the table names of the two models, sorts them lexically and
+    then joins them, stripping any common prefix from the second table name.
+
+    Some examples:
+
+        Top level models (Category <=> Product)
+        Old: categories_products
+        New: categories_products
+
+        Top level models with a global table_name_prefix (Category <=> Product)
+        Old: site_categories_products
+        New: site_categories_products
+
+        Nested models in a module without a table_name_prefix method (Admin::Category <=> Admin::Product)
+        Old: categories_products
+        New: categories_products
+
+        Nested models in a module with a table_name_prefix method (Admin::Category <=> Admin::Product)
+        Old: categories_products
+        New: admin_categories_products
+
+        Nested models in a parent model (Catalog::Category <=> Catalog::Product)
+        Old: categories_products
+        New: catalog_categories_products
+
+        Nested models in different parent models (Catalog::Category <=> Content::Page)
+        Old: categories_pages
+        New: catalog_categories_content_pages
+
+    *Andrew White*
+
+*   Move HABTM validity checks to ActiveRecord::Relation. One side effect of
+    this is to move when the exceptions are raised from the point of declaration
+    to when the association is built. This is consistant with other association
+    validity checks.
+
+    *Andrew White*
+
 *   Added `stored_attributes` hash which contains the attributes stored using
     ActiveRecord::Store. This allows you to retrieve the list of attributes
     you've defined.
diff --git a/activerecord/lib/active_record/associations/builder/has_and_belongs_to_many.rb b/activerecord/lib/active_record/associations/builder/has_and_belongs_to_many.rb
index 30fc44b4c242622c5922d6aac813bd7f9894fd9b..f7656ecd472776ea436621e3158a72e033c0bb1d 100644
--- a/activerecord/lib/active_record/associations/builder/has_and_belongs_to_many.rb
+++ b/activerecord/lib/active_record/associations/builder/has_and_belongs_to_many.rb
@@ -6,7 +6,6 @@ class HasAndBelongsToMany < CollectionAssociation #:nodoc:
 
     def build
       reflection = super
-      check_validity(reflection)
       define_destroy_hook
       reflection
     end
@@ -24,34 +23,5 @@ def destroy_associations
           RUBY
         })
       end
-
-      # TODO: These checks should probably be moved into the Reflection, and we should not be
-      #       redefining the options[:join_table] value - instead we should define a
-      #       reflection.join_table method.
-      def check_validity(reflection)
-        if reflection.association_foreign_key == reflection.foreign_key
-          raise ActiveRecord::HasAndBelongsToManyAssociationForeignKeyNeeded.new(reflection)
-        end
-
-        reflection.options[:join_table] ||= join_table_name(
-          model.send(:undecorated_table_name, model.to_s),
-          model.send(:undecorated_table_name, reflection.class_name)
-        )
-      end
-
-      # Generates a join table name from two provided table names.
-      # The names in the join table names end up in lexicographic order.
-      #
-      #   join_table_name("members", "clubs")         # => "clubs_members"
-      #   join_table_name("members", "special_clubs") # => "members_special_clubs"
-      def join_table_name(first_table_name, second_table_name)
-        if first_table_name < second_table_name
-          join_table = "#{first_table_name}_#{second_table_name}"
-        else
-          join_table = "#{second_table_name}_#{first_table_name}"
-        end
-
-        model.table_name_prefix + join_table + model.table_name_suffix
-      end
   end
 end
diff --git a/activerecord/lib/active_record/associations/has_and_belongs_to_many_association.rb b/activerecord/lib/active_record/associations/has_and_belongs_to_many_association.rb
index 58d041ec1d59c143713f7d1d946071988e3b240e..93618721bb96d43972899d5f2163f21d151aaa4e 100644
--- a/activerecord/lib/active_record/associations/has_and_belongs_to_many_association.rb
+++ b/activerecord/lib/active_record/associations/has_and_belongs_to_many_association.rb
@@ -5,7 +5,7 @@ class HasAndBelongsToManyAssociation < CollectionAssociation #:nodoc:
       attr_reader :join_table
 
       def initialize(owner, reflection)
-        @join_table = Arel::Table.new(reflection.options[:join_table])
+        @join_table = Arel::Table.new(reflection.join_table)
         super
       end
 
diff --git a/activerecord/lib/active_record/associations/join_helper.rb b/activerecord/lib/active_record/associations/join_helper.rb
index cea6ad69442dab2074919f7f962297ad9ee07cf3..5a41b40c8fc6d98755095475238e85537c3356e1 100644
--- a/activerecord/lib/active_record/associations/join_helper.rb
+++ b/activerecord/lib/active_record/associations/join_helper.rb
@@ -19,7 +19,7 @@ def construct_tables
 
           if reflection.source_macro == :has_and_belongs_to_many
             tables << alias_tracker.aliased_table_for(
-              (reflection.source_reflection || reflection).options[:join_table],
+              (reflection.source_reflection || reflection).join_table,
               table_alias_for(reflection, true)
             )
           end
diff --git a/activerecord/lib/active_record/associations/preloader/has_and_belongs_to_many.rb b/activerecord/lib/active_record/associations/preloader/has_and_belongs_to_many.rb
index b77b6672196f4160e8f75bff3e074218f426c635..8e8925f0a95f7a320d9517f7c71dfb06403887e4 100644
--- a/activerecord/lib/active_record/associations/preloader/has_and_belongs_to_many.rb
+++ b/activerecord/lib/active_record/associations/preloader/has_and_belongs_to_many.rb
@@ -6,7 +6,7 @@ class HasAndBelongsToMany < CollectionAssociation #:nodoc:
 
         def initialize(klass, records, reflection, preload_options)
           super
-          @join_table = Arel::Table.new(options[:join_table]).alias('t0')
+          @join_table = Arel::Table.new(reflection.join_table).alias('t0')
         end
 
         # Unlike the other associations, we want to get a raw array of rows so that we can
diff --git a/activerecord/lib/active_record/fixtures.rb b/activerecord/lib/active_record/fixtures.rb
index 7e6512501cf4dbe76e3df49ff6c19a0582ecc687..96d24b72b3583d60fa45fab10ec8cdcf8ea526e0 100644
--- a/activerecord/lib/active_record/fixtures.rb
+++ b/activerecord/lib/active_record/fixtures.rb
@@ -594,7 +594,7 @@ def table_rows
             when :has_and_belongs_to_many
               if (targets = row.delete(association.name.to_s))
                 targets = targets.is_a?(Array) ? targets : targets.split(/\s*,\s*/)
-                table_name = association.options[:join_table]
+                table_name = association.join_table
                 rows[table_name].concat targets.map { |target|
                   { association.foreign_key             => row[primary_key_name],
                     association.association_foreign_key => ActiveRecord::Fixtures.identify(target) }
diff --git a/activerecord/lib/active_record/reflection.rb b/activerecord/lib/active_record/reflection.rb
index e9a8e9053806fb118d997ad5ff644b31ce0bb859..0d9534acd6e5637f906398319ca140f100ebf61d 100644
--- a/activerecord/lib/active_record/reflection.rb
+++ b/activerecord/lib/active_record/reflection.rb
@@ -161,6 +161,10 @@ def quoted_table_name
         @quoted_table_name ||= klass.quoted_table_name
       end
 
+      def join_table
+        @join_table ||= options[:join_table] || derive_join_table
+      end
+
       def foreign_key
         @foreign_key ||= options[:foreign_key] || derive_foreign_key
       end
@@ -208,6 +212,10 @@ def reset_column_information
 
       def check_validity!
         check_validity_of_inverse!
+
+        if has_and_belongs_to_many? && association_foreign_key == foreign_key
+          raise HasAndBelongsToManyAssociationForeignKeyNeeded.new(self)
+        end
       end
 
       def check_validity_of_inverse!
@@ -290,6 +298,10 @@ def belongs_to?
         macro == :belongs_to
       end
 
+      def has_and_belongs_to_many?
+        macro == :has_and_belongs_to_many
+      end
+
       def association_class
         case macro
         when :belongs_to
@@ -332,6 +344,10 @@ def derive_foreign_key
           end
         end
 
+        def derive_join_table
+          [active_record.table_name, klass.table_name].sort.join("\0").gsub(/^(.*_)(.+)\0\1(.+)/, '\1\2_\3').gsub("\0", "_")
+        end
+
         def primary_key(klass)
           klass.primary_key || raise(UnknownPrimaryKey.new(klass))
         end
diff --git a/activerecord/test/cases/adapters/mysql/reserved_word_test.rb b/activerecord/test/cases/adapters/mysql/reserved_word_test.rb
index 6faceaf7c04e6433cd6bcbc0527112a9853669a9..8e3eeac81ed8e53c56b5ff1488435a4fa60fa3d2 100644
--- a/activerecord/test/cases/adapters/mysql/reserved_word_test.rb
+++ b/activerecord/test/cases/adapters/mysql/reserved_word_test.rb
@@ -34,11 +34,11 @@ def setup
       'select'=>'id int auto_increment primary key',
       'values'=>'id int auto_increment primary key, group_id int',
       'distinct'=>'id int auto_increment primary key',
-      'distincts_selects'=>'distinct_id int, select_id int'
+      'distinct_select'=>'distinct_id int, select_id int'
   end
 
   def teardown
-    drop_tables_directly ['group', 'select', 'values', 'distinct', 'distincts_selects', 'order']
+    drop_tables_directly ['group', 'select', 'values', 'distinct', 'distinct_select', 'order']
   end
 
   # create tables with reserved-word names and columns
@@ -80,7 +80,7 @@ def test_introspect
 
   #activerecord model class with reserved-word table name
   def test_activerecord_model
-    create_test_fixtures :select, :distinct, :group, :values, :distincts_selects
+    create_test_fixtures :select, :distinct, :group, :values, :distinct_select
     x = nil
     assert_nothing_raised { x = Group.new }
     x.order = 'x'
@@ -94,7 +94,7 @@ def test_activerecord_model
 
   # has_one association with reserved-word table name
   def test_has_one_associations
-    create_test_fixtures :select, :distinct, :group, :values, :distincts_selects
+    create_test_fixtures :select, :distinct, :group, :values, :distinct_select
     v = nil
     assert_nothing_raised { v = Group.find(1).values }
     assert_equal 2, v.id
@@ -102,7 +102,7 @@ def test_has_one_associations
 
   # belongs_to association with reserved-word table name
   def test_belongs_to_associations
-    create_test_fixtures :select, :distinct, :group, :values, :distincts_selects
+    create_test_fixtures :select, :distinct, :group, :values, :distinct_select
     gs = nil
     assert_nothing_raised { gs = Select.find(2).groups }
     assert_equal gs.length, 2
@@ -111,7 +111,7 @@ def test_belongs_to_associations
 
   # has_and_belongs_to_many with reserved-word table name
   def test_has_and_belongs_to_many
-    create_test_fixtures :select, :distinct, :group, :values, :distincts_selects
+    create_test_fixtures :select, :distinct, :group, :values, :distinct_select
     s = nil
     assert_nothing_raised { s = Distinct.find(1).selects }
     assert_equal s.length, 2
diff --git a/activerecord/test/cases/adapters/mysql2/reserved_word_test.rb b/activerecord/test/cases/adapters/mysql2/reserved_word_test.rb
index 32d4282623e27530c286e9ec8884ca9690c35317..5c2c113c7852c46f21deb23937336f370317dcd4 100644
--- a/activerecord/test/cases/adapters/mysql2/reserved_word_test.rb
+++ b/activerecord/test/cases/adapters/mysql2/reserved_word_test.rb
@@ -34,11 +34,11 @@ def setup
       'select'=>'id int auto_increment primary key',
       'values'=>'id int auto_increment primary key, group_id int',
       'distinct'=>'id int auto_increment primary key',
-      'distincts_selects'=>'distinct_id int, select_id int'
+      'distinct_select'=>'distinct_id int, select_id int'
   end
 
   def teardown
-    drop_tables_directly ['group', 'select', 'values', 'distinct', 'distincts_selects', 'order']
+    drop_tables_directly ['group', 'select', 'values', 'distinct', 'distinct_select', 'order']
   end
 
   # create tables with reserved-word names and columns
@@ -80,7 +80,7 @@ def test_introspect
 
   #activerecord model class with reserved-word table name
   def test_activerecord_model
-    create_test_fixtures :select, :distinct, :group, :values, :distincts_selects
+    create_test_fixtures :select, :distinct, :group, :values, :distinct_select
     x = nil
     assert_nothing_raised { x = Group.new }
     x.order = 'x'
@@ -94,7 +94,7 @@ def test_activerecord_model
 
   # has_one association with reserved-word table name
   def test_has_one_associations
-    create_test_fixtures :select, :distinct, :group, :values, :distincts_selects
+    create_test_fixtures :select, :distinct, :group, :values, :distinct_select
     v = nil
     assert_nothing_raised { v = Group.find(1).values }
     assert_equal 2, v.id
@@ -102,7 +102,7 @@ def test_has_one_associations
 
   # belongs_to association with reserved-word table name
   def test_belongs_to_associations
-    create_test_fixtures :select, :distinct, :group, :values, :distincts_selects
+    create_test_fixtures :select, :distinct, :group, :values, :distinct_select
     gs = nil
     assert_nothing_raised { gs = Select.find(2).groups }
     assert_equal gs.length, 2
@@ -111,7 +111,7 @@ def test_belongs_to_associations
 
   # has_and_belongs_to_many with reserved-word table name
   def test_has_and_belongs_to_many
-    create_test_fixtures :select, :distinct, :group, :values, :distincts_selects
+    create_test_fixtures :select, :distinct, :group, :values, :distinct_select
     s = nil
     assert_nothing_raised { s = Distinct.find(1).selects }
     assert_equal s.length, 2
diff --git a/activerecord/test/cases/associations/has_and_belongs_to_many_associations_test.rb b/activerecord/test/cases/associations/has_and_belongs_to_many_associations_test.rb
index 9d693bae0c875ecba3a5775ff657ec1f6d46d610..24bb4adf0aa551a472a0fbdbf96dc2bbe0eb4b81 100644
--- a/activerecord/test/cases/associations/has_and_belongs_to_many_associations_test.rb
+++ b/activerecord/test/cases/associations/has_and_belongs_to_many_associations_test.rb
@@ -773,9 +773,7 @@ def test_symbols_as_keys
 
   def test_self_referential_habtm_without_foreign_key_set_should_raise_exception
     assert_raise(ActiveRecord::HasAndBelongsToManyAssociationForeignKeyNeeded) {
-      Member.class_eval do
-        has_and_belongs_to_many :friends, :class_name => "Member", :join_table => "member_friends"
-      end
+      SelfMember.new.friends
     }
   end
 
diff --git a/activerecord/test/fixtures/reserved_words/distincts_selects.yml b/activerecord/test/fixtures/reserved_words/distinct_select.yml
similarity index 62%
rename from activerecord/test/fixtures/reserved_words/distincts_selects.yml
rename to activerecord/test/fixtures/reserved_words/distinct_select.yml
index 90e8c95fefb14e181facfbb79a213d4b0462de9f..d96779ade402ae8b0689513b94c11ede855cb2ef 100644
--- a/activerecord/test/fixtures/reserved_words/distincts_selects.yml
+++ b/activerecord/test/fixtures/reserved_words/distinct_select.yml
@@ -1,11 +1,11 @@
-distincts_selects1:
+distinct_select1:
   distinct_id: 1
   select_id: 1
 
-distincts_selects2:
+distinct_select2:
   distinct_id: 1
   select_id: 2
 
-distincts_selects3:
+distinct_select3:
   distinct_id: 2
   select_id: 3
diff --git a/activerecord/test/models/member.rb b/activerecord/test/models/member.rb
index 11a0f4ff631297a5b8d8dc881d9e089bb156264f..1f719b0858820932789a619fe4d3c07fb60ae0b7 100644
--- a/activerecord/test/models/member.rb
+++ b/activerecord/test/models/member.rb
@@ -30,3 +30,8 @@ class Member < ActiveRecord::Base
   has_many :current_memberships, :conditions => { :favourite => true }
   has_many :clubs, :through => :current_memberships
 end
+
+class SelfMember < ActiveRecord::Base
+  self.table_name = "members"
+  has_and_belongs_to_many :friends, :class_name => "SelfMember", :join_table => "member_friends"
+end
diff --git a/activerecord/test/schema/schema.rb b/activerecord/test/schema/schema.rb
index 5bcb9652cda4500d9bf42d64ca02b70e470d8ea9..ba01ef35f0f13977f54684d1dc6eaeae4972d256 100644
--- a/activerecord/test/schema/schema.rb
+++ b/activerecord/test/schema/schema.rb
@@ -361,6 +361,11 @@ def create_table(*args, &block)
     t.string :extra_data
   end
 
+  create_table :member_friends, :force => true, :id => false do |t|
+    t.integer :member_id
+    t.integer :friend_id
+  end
+
   create_table :memberships, :force => true do |t|
     t.datetime :joined_on
     t.integer :club_id, :member_id