diff --git a/enable/tools/drop_tool.py b/enable/tools/drop_tool.py
index a6c86367a..a91ee7332 100644
--- a/enable/tools/drop_tool.py
+++ b/enable/tools/drop_tool.py
@@ -12,39 +12,110 @@
 
 from __future__ import absolute_import, print_function, division
 
+from traits.api import Enum
+
 from enable.base_tool import BaseTool
 
 
 class BaseDropTool(BaseTool):
     """ Abstract base class for tools that handle drag and drop """
 
+    default_drag_result = Enum("copy", "move", "link", "cancel",
+                               "error", "none")
+
     def normal_drag_over(self, event):
         """ Handle dragging over the component """
+        if event.handled:
+            return
         try:
-            result = self.accepts_drop(event.obj)
-            self.component.window.set_drag_result(result)
+            result = self.get_drag_result((event.x, event.y), event.obj)
+            if result is not None:
+                self.component.window.set_drag_result(result)
+                event.handled = True
         except Exception:
             self.component.window.set_drag_result("error")
             raise
 
     def normal_dropped_on(self, event):
-        if self.accepts_drop(event.obj) != "none":
-            self.handle_drop(event.obj)
+        if event.handled:
+            return
+        position = (event.x, event.y)
+        if self.accept_drop(position, event.obj):
+            self.handle_drop(position, event.obj)
+            event.handled = True
+
+    def get_drag_result(self, position, obj):
+        """ The type of drag that will happen
+
+        By default, if the dragged objects are available this method calls
+        accept_drop() and returns "none" if the result is False, otherwise
+        it returns the value of default_drag_result.
+
+        Parameters
+        ----------
+
+        position :
+            The coordinates of the drag over event
+
+        obj : any
+            The object(s) being dragged, if available.  Some backends (such as
+            Wx) may not be able to provide the object being dragged, in which
+            case `obj` will be `None`.
+
+        Returns
+        -------
+
+        Either None, if the drop should be ignored by this tool and not
+        handled, or one of the keys of DRAG_RESULTS_MAP: "none", "copy, "move",
+        "link", "cancel" or "error".
+
+        """
+        if obj is not None:
+            # if we have the object, see if we can accept
+            if not self.accept_drop(position, obj):
+                return None
 
-    def accepts_drop(self, urls):
-        """ Whether or not to accept the drag, and the type of drag
+        return self.default_drag_result
 
-        The return value is either "none", if the drag is refused for the
-        dragged object types, or one of "copy", "move", or "link".
+    def accept_drop(self, position, obj):
+        """ Whether or not to accept the drop
 
         Subclasses should override this method.
 
+        Parameters
+        ----------
+
+        position :
+            The coordinates of the drag over event
+
+        obj : any
+            The object(s) being dragged, if available.  Some backends (such as
+            Wx) may not be able to provide the object being dragged, in which
+            case `obj` will be `None`.
+
+        Returns
+        -------
+
+        True if the drop should be accepted, False otherwise.
+
         """
         raise NotImplementedError
 
-    def handle_drop(self, urls):
+    def handle_drop(self, position, obj):
         """ Handle objects being dropped on the component
 
         Subclasses should override this method.
+
+        Parameters
+        ----------
+
+        position :
+            The coordinates of the drag over event
+
+        obj : any
+            The object(s) being dragged, if available.  Some backends (such as
+            Wx) may not be able to provide the object being dragged, in which
+            case `obj` will be `None`.
+
         """
         raise NotImplementedError
diff --git a/examples/enable/tools/drop_tool.py b/examples/enable/tools/drop_tool.py
new file mode 100644
index 000000000..1e8ed5e00
--- /dev/null
+++ b/examples/enable/tools/drop_tool.py
@@ -0,0 +1,50 @@
+"""
+This demonstrates the use of the drop tool.
+"""
+from enable.example_support import DemoFrame, demo_main
+from enable.api import Component, Container, Label, Window
+from enable.tools.drop_tool import BaseDropTool
+
+class Box(Component):
+
+    resizable = ""
+
+    def _draw_mainlayer(self, gc, view_bounds=None, mode="default"):
+        with gc:
+            gc.set_fill_color((1.0, 0.0, 0.0, 1.0))
+            dx, dy = self.bounds
+            x, y = self.position
+            gc.rect(x, y, dx, dy)
+            gc.fill_path()
+
+class TextDropTool(BaseDropTool):
+    """ Example implementation of a drop tool """
+
+    def accept_drop(self, location, obj):
+        return True
+
+    def handle_drop(self, location, objs):
+        if not isinstance(objs, list):
+            objs = [objs]
+        x, y = location
+        for obj in objs:
+            label = Label(text=str(obj), position=[x, y], bounds=[100, 50])
+            self.component.add(label)
+            self.component.request_redraw()
+            y += 15
+
+
+class MyFrame(DemoFrame):
+
+    def _create_window(self):
+        box = Box(bounds=[100.0, 100.0], position=[50.0, 50.0])
+        container = Container(bounds=[500,500])
+        container.add(box)
+        drop_tool = TextDropTool(component=container)
+        container.tools.append(drop_tool)
+        return Window(self, -1, component=container)
+
+if __name__ == "__main__":
+    demo_main(MyFrame)
+
+# EOF