diff --git a/libraries/SITL/SIM_Balloon.cpp b/libraries/SITL/SIM_Balloon.cpp
new file mode 100644
index 0000000000..22c9ad6567
--- /dev/null
+++ b/libraries/SITL/SIM_Balloon.cpp
@@ -0,0 +1,122 @@
+/// -*- tab-width: 4; Mode: C++; c-basic-offset: 4; indent-tabs-mode: nil -*-
+/*
+   This program is free software: you can redistribute it and/or modify
+   it under the terms of the GNU General Public License as published by
+   the Free Software Foundation, either version 3 of the License, or
+   (at your option) any later version.
+
+   This program is distributed in the hope that it will be useful,
+   but WITHOUT ANY WARRANTY; without even the implied warranty of
+   MERCHANTABILITY or FITNESS FOR A PARTICULAR PURPOSE.  See the
+   GNU General Public License for more details.
+
+   You should have received a copy of the GNU General Public License
+   along with this program.  If not, see <http://www.gnu.org/licenses/>.
+ */
+/*
+  balloon simulator class
+*/
+
+#include <AP_HAL.h>
+#if CONFIG_HAL_BOARD == HAL_BOARD_SITL
+#include "SIM_Balloon.h"
+#include <stdio.h>
+
+/*
+  constructor
+ */
+Balloon::Balloon(const char *home_str, const char *frame_str) :
+    Aircraft(home_str, frame_str)
+{
+    mass = 5.0f;
+}
+
+/*
+  update the balloon simulation by one time step
+ */
+void Balloon::update(const struct sitl_input &input)
+{
+    if (!released && input.servos[6] > 1800) {
+        ::printf("Balloon released\n");
+        released = true;
+    }
+
+    if (!burst && input.servos[7] > 1800) {
+        ::printf("Balloon burst\n");
+        burst = true;
+    }
+
+    float delta_time = frame_time_us * 1.0e-6f;
+
+    // rotational air resistance
+    Vector3f rot_accel = -gyro * radians(400) / terminal_rotation_rate;
+
+    // update rotational rates in body frame
+    gyro += rot_accel * delta_time;
+
+    // update attitude
+    dcm.rotate(gyro * delta_time);
+    dcm.normalize();
+
+    // air resistance
+    Vector3f air_resistance = -velocity_ef * (GRAVITY_MSS/terminal_velocity);
+
+    float lift_accel = 0;
+    if (!burst && released) {
+        float air_resistance_at_climb_rate = climb_rate * (GRAVITY_MSS/terminal_velocity);
+        lift_accel = air_resistance_at_climb_rate + GRAVITY_MSS * dcm.c.z;
+    }
+
+    accel_body = Vector3f(0, 0, -lift_accel);
+    Vector3f accel_earth = dcm * accel_body;
+    accel_earth += Vector3f(0, 0, GRAVITY_MSS);
+    accel_earth += air_resistance;
+
+    // if we're on the ground, then our vertical acceleration is limited
+    // to zero. This effectively adds the force of the ground on the aircraft
+    if (on_ground(position) && accel_earth.z > 0) {
+        accel_earth.z = 0;
+    }
+
+    // work out acceleration as seen by the accelerometers. It sees the kinematic
+    // acceleration (ie. real movement), plus gravity
+    accel_body = dcm.transposed() * (accel_earth + Vector3f(0, 0, -GRAVITY_MSS));
+
+    // add some noise
+    add_noise(velocity_ef.length() / terminal_velocity);
+
+    // new velocity vector
+    velocity_ef += accel_earth * delta_time;
+
+    // new position vector
+    Vector3f old_position = position;
+    position += velocity_ef * delta_time;
+
+    if (position.z < -burst_altitude) {
+        ::printf("Balloon burst at %.1f\n", -position.z);
+        burst = true;
+    }
+
+    // assume zero wind for now
+    airspeed = velocity_ef.length();
+
+    // constrain height to the ground
+    if (on_ground(position)) {
+        if (!on_ground(old_position)) {
+            printf("Hit ground at %f m/s\n", velocity_ef.z);
+
+            velocity_ef.zero();
+
+            // zero roll/pitch, but keep yaw
+            float r, p, y;
+            dcm.to_euler(&r, &p, &y);
+            dcm.from_euler(0, 0, y);
+
+            position.z = -(ground_level + frame_height - home.alt*0.01f);
+        }
+    }
+
+    // update lat/lon/altitude
+    update_position();
+}
+#endif // CONFIG_HAL_BOARD
diff --git a/libraries/SITL/SIM_Balloon.h b/libraries/SITL/SIM_Balloon.h
new file mode 100644
index 0000000000..8d58643198
--- /dev/null
+++ b/libraries/SITL/SIM_Balloon.h
@@ -0,0 +1,51 @@
+/// -*- tab-width: 4; Mode: C++; c-basic-offset: 4; indent-tabs-mode: nil -*-
+/*
+   This program is free software: you can redistribute it and/or modify
+   it under the terms of the GNU General Public License as published by
+   the Free Software Foundation, either version 3 of the License, or
+   (at your option) any later version.
+
+   This program is distributed in the hope that it will be useful,
+   but WITHOUT ANY WARRANTY; without even the implied warranty of
+   MERCHANTABILITY or FITNESS FOR A PARTICULAR PURPOSE.  See the
+   GNU General Public License for more details.
+
+   You should have received a copy of the GNU General Public License
+   along with this program.  If not, see <http://www.gnu.org/licenses/>.
+ */
+/*
+  balloon simulator class
+*/
+
+#ifndef _SIM_BALLOON_H
+#define _SIM_BALLOON_H
+
+#include "SIM_Aircraft.h"
+
+/*
+  a balloon simulator
+ */
+class Balloon : public Aircraft
+{
+public:
+    Balloon(const char *home_str, const char *frame_str);
+
+    /* update model by one time step */
+    void update(const struct sitl_input &input);
+
+    /* static object creator */
+    static Aircraft *create(const char *home_str, const char *frame_str) {
+        return new Balloon(home_str, frame_str);
+    }
+
+private:
+    float terminal_rotation_rate = radians(100);
+    float climb_rate = 20;
+    float terminal_velocity = 40;
+    float burst_altitude = 20000;
+    bool burst = false;
+    bool released = false;
+};
+
+
+#endif // _SIM_BALLOON_H