diff --git a/Makefile b/Makefile
index 0467f8d055..2e257a5593 100644
--- a/Makefile
+++ b/Makefile
@@ -18,17 +18,23 @@ EXT=
 PROG=ffmpeg ffplay ffserver
 endif
 
+ifeq ($(BUILD_SHARED),yes)
+FFMPEG_LIB=-Llibavcodec -lffmpeg
+else
+FFMPEG_LIB=libavcodec/libavcodec.a
+endif
+
 all: lib $(PROG)
 
 lib:
 	$(MAKE) -C libavcodec all
 	$(MAKE) -C libav all
 
-ffmpeg$(EXE): ffmpeg.o libav/libav.a libavcodec/libavcodec.a
-	$(CC) $(LDFLAGS) -o $@ $^ -lm
+ffmpeg$(EXE): ffmpeg.o libav/libav.a 
+	$(CC) $(LDFLAGS) -lm -o $@ $^ $(FFMPEG_LIB)
 
-ffserver$(EXE): ffserver.o libav/libav.a libavcodec/libavcodec.a
-	$(CC) $(LDFLAGS) -o $@ $^ -lm
+ffserver$(EXE): ffserver.o libav/libav.a 
+	$(CC) $(LDFLAGS) -lm -o $@ $^ $(FFMPEG_LIB)
 
 ffplay: ffmpeg$(EXE)
 	ln -sf $< $@
@@ -37,6 +43,7 @@ ffplay: ffmpeg$(EXE)
 	$(CC) $(CFLAGS) -c -o $@ $< 
 
 install: all
+	$(MAKE) -C libavcodec install
 	install -s -m 755 $(PROG) $(prefix)/bin
 	ln -sf ffmpeg $(prefix)/bin/ffplay 
 
diff --git a/VERSION b/VERSION
new file mode 100644
index 0000000000..c8a5397fb8
--- /dev/null
+++ b/VERSION
@@ -0,0 +1 @@
+0.4.5
\ No newline at end of file
diff --git a/libavcodec/Makefile b/libavcodec/Makefile
index ad4f24873e..b2381714f6 100644
--- a/libavcodec/Makefile
+++ b/libavcodec/Makefile
@@ -39,15 +39,22 @@ endif
 SRCS = $(OBJS:.o=.c) $(ASM_OBJS:.o=.s)
 
 LIB= libavcodec.a
+ifeq ($(BUILD_SHARED),yes)
+SLIB= libffmpeg-$(VERSION).so
+endif
 TESTS= imgresample-test dct-test motion-test
 
-all: $(LIB)
+all: $(LIB) $(SLIB)
 tests: apiexample cpuid_test $(TESTS)
 
 $(LIB): $(OBJS) $(ASM_OBJS)
 	rm -f $@
 	$(AR) rcs $@ $(OBJS) $(ASM_OBJS)
 
+$(SLIB): $(OBJS) $(ASM_OBJS)
+	rm -f $@
+	$(CC) -shared -o $@ $(OBJS) $(ASM_OBJS)
+	ln -sf $@ libffmpeg.so
 dsputil.o: dsputil.c dsputil.h
 
 %.o: %.c
@@ -63,7 +70,7 @@ depend:
 	$(CC) -MM $(CFLAGS) $(SRCS) 1>.depend
 
 clean: 
-	rm -f *.o *~ *.a i386/*.o i386/*~ \
+	rm -f *.o *~ $(LIB) $(SLIB) *.so i386/*.o i386/*~ \
 	   armv4l/*.o armv4l/*~ \
 	   mlib/*.o mlib/*~ \
            libac3/*.o libac3/*~ \
@@ -92,6 +99,13 @@ dct-test: dct-test.o jfdctfst.o i386/fdct_mmx.o \
 motion-test: motion_test.o $(LIB)
 	$(CC) -o $@ $^
 
+install: all
+#	install -s -m 644 $(LIB) $(prefix)/lib
+ifeq ($(BUILD_SHARED),yes)
+	install -s -m 755 $(SLIB) $(prefix)/lib
+	ln -sf $(prefix)/lib/$(SLIB) $(prefix)/lib/libffmpeg.so
+	ldconfig
+endif
 #
 # include dependency files if they exist
 #