diff --git a/.rspec b/.rspec
new file mode 100755
index 00000000000..b94d663c9ac
--- /dev/null
+++ b/.rspec
@@ -0,0 +1,6 @@
+-Isrc/ruby
+-Isrc/ruby/pb
+--backtrace
+--require spec/spec_helper
+--format documentation
+--color
diff --git a/src/ruby/Gemfile b/Gemfile
similarity index 100%
rename from src/ruby/Gemfile
rename to Gemfile
diff --git a/src/ruby/Rakefile b/Rakefile
similarity index 66%
rename from src/ruby/Rakefile
rename to Rakefile
index cc7832b12d2..079df679962 100755
--- a/src/ruby/Rakefile
+++ b/Rakefile
@@ -5,23 +5,28 @@ require 'rubocop/rake_task'
 require 'bundler/gem_tasks'
 
 # Add rubocop style checking tasks
-RuboCop::RakeTask.new
+RuboCop::RakeTask.new(:rubocop) do |task|
+  task.options = ['-c', 'src/ruby/.rubocop.yml']
+  task.patterns = ['src/ruby/{lib,spec}/**/*.rb']
+end
 
 # Add the extension compiler task
 Rake::ExtensionTask.new 'grpc' do |ext|
-  ext.lib_dir = File.join('lib', 'grpc')
+  ext.source_pattern = '**/*.{c,h}'
+  ext.ext_dir = File.join('src', 'ruby', 'ext', 'grpc')
+  ext.lib_dir = File.join('src', 'ruby', 'lib', 'grpc')
 end
 
 # Define the test suites
 SPEC_SUITES = [
-  { id: :wrapper, title: 'wrapper layer', files: %w(spec/*.rb) },
-  { id: :idiomatic, title: 'idiomatic layer', dir: %w(spec/generic),
+  { id: :wrapper, title: 'wrapper layer', files: %w(src/ruby/spec/*.rb) },
+  { id: :idiomatic, title: 'idiomatic layer', dir: %w(src/ruby/spec/generic),
     tags: ['~bidi', '~server'] },
-  { id: :bidi, title: 'bidi tests', dir: %w(spec/generic),
+  { id: :bidi, title: 'bidi tests', dir: %w(src/ruby/spec/generic),
     tag: 'bidi' },
-  { id: :server, title: 'rpc server thread tests', dir: %w(spec/generic),
+  { id: :server, title: 'rpc server thread tests', dir: %w(src/ruby/spec/generic),
     tag: 'server' },
-  { id: :pb, title: 'protobuf service tests', dir: %w(spec/pb) }
+  { id: :pb, title: 'protobuf service tests', dir: %w(src/ruby/spec/pb) }
 ]
 namespace :suite do
   SPEC_SUITES.each do |suite|
@@ -34,7 +39,7 @@ namespace :suite do
       if suite[:dir]
         suite[:dir].each { |f| spec_files += Dir["#{f}/**/*_spec.rb"] }
       end
-      helper = 'spec/spec_helper.rb'
+      helper = 'src/ruby/spec/spec_helper.rb'
       spec_files << helper unless spec_files.include?(helper)
 
       t.pattern = spec_files
diff --git a/src/ruby/grpc.gemspec b/grpc.gemspec
similarity index 70%
rename from src/ruby/grpc.gemspec
rename to grpc.gemspec
index 363abe9a463..5526dbeb4f6 100755
--- a/src/ruby/grpc.gemspec
+++ b/grpc.gemspec
@@ -1,6 +1,6 @@
 # -*- ruby -*-
 # encoding: utf-8
-$LOAD_PATH.push File.expand_path('../lib', __FILE__)
+$LOAD_PATH.push File.expand_path('../src/ruby/lib', __FILE__)
 require 'grpc/version'
 
 Gem::Specification.new do |s|
@@ -16,17 +16,20 @@ Gem::Specification.new do |s|
   s.required_ruby_version = '>= 2.0.0'
   s.requirements << 'libgrpc ~> 0.11.0 needs to be installed'
 
-  s.files = %w( Rakefile )
-  s.files += Dir.glob('bin/**/*')
-  s.files += Dir.glob('ext/**/*')
-  s.files += Dir.glob('lib/**/*')
-  s.files += Dir.glob('pb/**/*')
-  s.test_files = Dir.glob('spec/**/*')
+  s.files = %w( Rakefile Makefile )
+  s.files += Dir.glob('src/ruby/bin/**/*')
+  s.files += Dir.glob('src/ruby/ext/**/*')
+  s.files += Dir.glob('src/ruby/lib/**/*')
+  s.files += Dir.glob('src/ruby/pb/**/*')
+  s.files += Dir.glob('include/grpc/**/*')
+  s.files += Dir.glob('src/core/**/*')
+  s.test_files = Dir.glob('src/ruby/spec/**/*')
+  s.bindir = 'src/ruby/bin'
   %w(math noproto).each do |b|
     s.executables += ["#{b}_client.rb", "#{b}_server.rb"]
   end
   s.executables += %w(grpc_ruby_interop_client grpc_ruby_interop_server)
-  s.require_paths = %w( bin lib pb )
+  s.require_paths = %w( src/ruby/bin src/ruby/lib src/ruby/pb )
   s.platform      = Gem::Platform::RUBY
 
   s.add_dependency 'google-protobuf', '~> 3.0.0alpha.1.1'
@@ -41,5 +44,5 @@ Gem::Specification.new do |s|
   s.add_development_dependency 'rubocop', '~> 0.30.0'
   s.add_development_dependency 'signet', '~>0.6.0'
 
-  s.extensions = %w(ext/grpc/extconf.rb)
+  s.extensions = %w(src/ruby/ext/grpc/extconf.rb)
 end
diff --git a/src/ruby/.rspec b/src/ruby/.rspec
deleted file mode 100755
index efeee2c1d22..00000000000
--- a/src/ruby/.rspec
+++ /dev/null
@@ -1,6 +0,0 @@
--I.
--Ipb
---backtrace
---require spec_helper
---format documentation
---color
diff --git a/src/ruby/ext/grpc/extconf.rb b/src/ruby/ext/grpc/extconf.rb
index db9385e9615..018353ce5d8 100644
--- a/src/ruby/ext/grpc/extconf.rb
+++ b/src/ruby/ext/grpc/extconf.rb
@@ -54,53 +54,30 @@ LIB_DIRS = [
   LIBDIR
 ]
 
-def check_grpc_root
-  grpc_root = ENV['GRPC_ROOT']
-  if grpc_root.nil?
-    r = File.expand_path(File.join(File.dirname(__FILE__), '../../../..'))
-    grpc_root = r if File.exist?(File.join(r, 'include/grpc/grpc.h'))
-  end
-  grpc_root
-end
+fail 'libdl not found' unless have_library('dl', 'dlopen')
+fail 'zlib not found' unless have_library('z', 'inflate')
+
+grpc_root = File.expand_path(File.join(File.dirname(__FILE__), '../../../..'))
 
-grpc_pkg_config = system('pkg-config --exists grpc')
+grpc_config = ENV['GRPC_CONFIG'] || 'opt'
 
-if grpc_pkg_config
-  $CFLAGS << ' ' + `pkg-config --static --cflags grpc`.strip + ' '
-  $LDFLAGS << ' ' + `pkg-config --static --libs grpc`.strip + ' '
+if ENV.key?('GRPC_LIB_DIR')
+  grpc_lib_dir = File.join(grpc_root, ENV['GRPC_LIB_DIR'])
 else
-  dir_config('grpc', HEADER_DIRS, LIB_DIRS)
-  fail 'libdl not found' unless have_library('dl', 'dlopen')
-  fail 'zlib not found' unless have_library('z', 'inflate')
-  begin
-    fail 'Fail' unless have_library('gpr', 'gpr_now')
-    fail 'Fail' unless have_library('grpc', 'grpc_channel_destroy')
-  rescue
-    # Check to see if GRPC_ROOT is defined or available
-    grpc_root = check_grpc_root
-
-    # Stop if there is still no grpc_root
-    exit 1 if grpc_root.nil?
-
-    grpc_config = ENV['GRPC_CONFIG'] || 'opt'
-    if ENV.key?('GRPC_LIB_DIR')
-      grpc_lib_dir = File.join(grpc_root, ENV['GRPC_LIB_DIR'])
-    else
-      grpc_lib_dir = File.join(File.join(grpc_root, 'libs'), grpc_config)
-    end
-    unless File.exist?(File.join(grpc_lib_dir, 'libgrpc.a'))
-      print "Building internal gRPC\n"
-      system("make -C #{grpc_root} static_c CONFIG=#{grpc_config}")
-    end
-    $CFLAGS << ' -I' + File.join(grpc_root, 'include')
-    $LDFLAGS << ' -L' + grpc_lib_dir
-    if grpc_config == 'gcov'
-      $CFLAGS << ' -O0 -fprofile-arcs -ftest-coverage'
-      $LDFLAGS << ' -fprofile-arcs -ftest-coverage -rdynamic'
-    end
-    raise 'gpr not found' unless have_library('gpr', 'gpr_now')
-    raise 'grpc not found' unless have_library('grpc', 'grpc_channel_destroy')
-  end
+  grpc_lib_dir = File.join(File.join(grpc_root, 'libs'), grpc_config)
+end
+
+unless File.exist?(File.join(grpc_lib_dir, 'libgrpc.a'))
+  print "Building internal gRPC\n"
+  system("make -C #{grpc_root} static_c CONFIG=#{grpc_config}")
+end
+
+$CFLAGS << ' -I' + File.join(grpc_root, 'include')
+$LDFLAGS << ' ' + File.join(grpc_lib_dir, 'libgrpc.a')
+$LDFLAGS << ' ' + File.join(grpc_lib_dir, 'libgpr.a')
+if grpc_config == 'gcov'
+  $CFLAGS << ' -O0 -fprofile-arcs -ftest-coverage'
+  $LDFLAGS << ' -fprofile-arcs -ftest-coverage -rdynamic'
 end
 
 $CFLAGS << ' -std=c99 '
@@ -109,4 +86,7 @@ $CFLAGS << ' -Wextra '
 $CFLAGS << ' -pedantic '
 $CFLAGS << ' -Werror '
 
+$LDFLAGS << ' -lssl '
+$LDFLAGS << ' -lcrypto '
+
 create_makefile('grpc/grpc')
diff --git a/tools/run_tests/build_ruby.sh b/tools/run_tests/build_ruby.sh
index 6d23c316c5a..8acb40dc62a 100755
--- a/tools/run_tests/build_ruby.sh
+++ b/tools/run_tests/build_ruby.sh
@@ -34,7 +34,7 @@ set -ex
 export GRPC_CONFIG=${CONFIG:-opt}
 
 # change to grpc's ruby directory
-cd $(dirname $0)/../../src/ruby
+cd $(dirname $0)/../..
 
 rm -rf ./tmp
 rake compile:grpc
diff --git a/tools/run_tests/run_ruby.sh b/tools/run_tests/run_ruby.sh
index b82ce52af38..73a84ac361f 100755
--- a/tools/run_tests/run_ruby.sh
+++ b/tools/run_tests/run_ruby.sh
@@ -31,6 +31,6 @@
 set -ex
 
 # change to grpc repo root
-cd $(dirname $0)/../../src/ruby
+cd $(dirname $0)/../..
 
 rake