diff --git a/python/ray/actor.py b/python/ray/actor.py
index 1785621c3..7967d17de 100644
--- a/python/ray/actor.py
+++ b/python/ray/actor.py
@@ -3,6 +3,7 @@ from __future__ import division
 from __future__ import print_function
 
 import cloudpickle as pickle
+import copy
 import hashlib
 import inspect
 import json
@@ -314,17 +315,25 @@ def make_actor(cls, num_cpus, num_gpus, checkpoint_interval):
                 self._actor_method_invokers[k] = ActorMethod(
                     self, k, self._ray_method_signatures[k])
 
-            # Export the actor class if it has not been exported yet.
-            if len(exported) == 0:
-                export_actor_class(class_id, Class,
-                                   self._ray_actor_methods.keys(),
-                                   checkpoint_interval,
-                                   ray.worker.global_worker)
-                exported.append(0)
-            # Export the actor.
-            export_actor(self._ray_actor_id, class_id,
-                         self._ray_actor_methods.keys(), num_cpus, num_gpus,
-                         ray.worker.global_worker)
+            # Do not export the actor class or the actor if run in PYTHON_MODE
+            # Instead, instantiate the actor locally and add it to
+            # global_worker's dictionary
+            if ray.worker.global_worker.mode == ray.PYTHON_MODE:
+                ray.worker.global_worker.actors[self._ray_actor_id] = (
+                    Class.__new__(Class))
+            else:
+                # Export the actor class if it has not been exported yet.
+                if len(exported) == 0:
+                    export_actor_class(class_id, Class,
+                                       self._ray_actor_methods.keys(),
+                                       checkpoint_interval,
+                                       ray.worker.global_worker)
+                    exported.append(0)
+                # Export the actor.
+                export_actor(self._ray_actor_id, class_id,
+                             self._ray_actor_methods.keys(), num_cpus,
+                             num_gpus, ray.worker.global_worker)
+
             # Call __init__ as a remote function.
             if "__init__" in self._ray_actor_methods.keys():
                 self._actor_method_call(
@@ -340,6 +349,14 @@ def make_actor(cls, num_cpus, num_gpus, checkpoint_interval):
             ray.worker.check_connected()
             ray.worker.check_main_thread()
             args = signature.extend_args(function_signature, args, kwargs)
+
+            # Execute functions locally if Ray is run in PYTHON_MODE
+            # Copy args to prevent the function from mutating them.
+            if ray.worker.global_worker.mode == ray.PYTHON_MODE:
+                return getattr(
+                    ray.worker.global_worker.actors[self._ray_actor_id],
+                    attr)(*copy.deepcopy(args))
+
             # Add the current actor cursor, a dummy object returned by the most
             # recent method invocation, as a dependency for the next method
             # invocation.
diff --git a/python/ray/worker.py b/python/ray/worker.py
index 81c355fc7..a24f1b9af 100644
--- a/python/ray/worker.py
+++ b/python/ray/worker.py
@@ -2067,6 +2067,12 @@ def wait(object_ids, num_returns=1, timeout=None, worker=global_worker):
     check_connected(worker)
     with log_span("ray:wait", worker=worker):
         check_main_thread()
+
+        # When Ray is run in PYTHON_MODE, all functions are run immediately,
+        # so all objects in object_id are ready.
+        if worker.mode == PYTHON_MODE:
+            return object_ids[:num_returns], object_ids[num_returns:]
+
         object_id_strs = [plasma.ObjectID(object_id.id())
                           for object_id in object_ids]
         timeout = timeout if timeout is not None else 2 ** 30
diff --git a/test/runtest.py b/test/runtest.py
index 361416e60..684832524 100644
--- a/test/runtest.py
+++ b/test/runtest.py
@@ -907,6 +907,44 @@ class PythonModeTest(unittest.TestCase):
         assert_equal(aref, np.array([0, 0]))
         assert_equal(bref, np.array([1, 0]))
 
+        # wait should return the first num_returns values passed in as the
+        # first list and the remaining values as the second list
+        num_returns = 5
+        object_ids = [ray.put(i) for i in range(20)]
+        ready, remaining = ray.wait(object_ids, num_returns=num_returns,
+                                    timeout=None)
+        assert_equal(ready, object_ids[:num_returns])
+        assert_equal(remaining, object_ids[num_returns:])
+
+        # Test actors in PYTHON_MODE.
+
+        @ray.remote
+        class PythonModeTestClass(object):
+            def __init__(self, array):
+                self.array = array
+
+            def set_array(self, array):
+                self.array = array
+
+            def get_array(self):
+                return self.array
+
+            def modify_and_set_array(self, array):
+                array[0] = -1
+                self.array = array
+
+        test_actor = PythonModeTestClass.remote(np.arange(10))
+        # Remote actor functions should return by value
+        assert_equal(test_actor.get_array.remote(), np.arange(10))
+
+        test_array = np.arange(10)
+        # Remote actor functions should not mutate arguments
+        test_actor.modify_and_set_array.remote(test_array)
+        assert_equal(test_array, np.arange(10))
+        # Remote actor functions should keep state
+        test_array[0] = -1
+        assert_equal(test_array, test_actor.get_array.remote())
+
         ray.worker.cleanup()