diff --git a/lib/axios.js b/lib/axios.js
index ed1f519..8142437 100644
--- a/lib/axios.js
+++ b/lib/axios.js
@@ -3,6 +3,7 @@
 var utils = require('./utils');
 var bind = require('./helpers/bind');
 var Axios = require('./core/Axios');
+var mergeConfig = require('./core/mergeConfig');
 var defaults = require('./defaults');
 
 /**
@@ -32,7 +33,7 @@ axios.Axios = Axios;
 
 // Factory for creating new instances
 axios.create = function create(instanceConfig) {
-  return createInstance(utils.merge(defaults, instanceConfig));
+  return createInstance(mergeConfig(axios.defaults, instanceConfig));
 };
 
 // Expose Cancel & CancelToken
diff --git a/lib/core/Axios.js b/lib/core/Axios.js
index f6eca92..8407a96 100644
--- a/lib/core/Axios.js
+++ b/lib/core/Axios.js
@@ -1,9 +1,9 @@
 'use strict';
 
-var defaults = require('./../defaults');
 var utils = require('./../utils');
 var InterceptorManager = require('./InterceptorManager');
 var dispatchRequest = require('./dispatchRequest');
+var mergeConfig = require('./mergeConfig');
 
 /**
  * Create a new instance of Axios
@@ -27,13 +27,14 @@ Axios.prototype.request = function request(config) {
   /*eslint no-param-reassign:0*/
   // Allow for axios('example/url'[, config]) a la fetch API
   if (typeof config === 'string') {
-    config = utils.merge({
-      url: arguments[0]
-    }, arguments[1]);
+    config = arguments[1] || {};
+    config.url = arguments[0];
+  } else {
+    config = config || {};
   }
 
-  config = utils.merge(defaults, this.defaults, config);
-  config.method = config.method.toLowerCase();
+  config = mergeConfig(this.defaults, config);
+  config.method = config.method ? config.method.toLowerCase() : 'get';
 
   // Hook up interceptors middleware
   var chain = [dispatchRequest, undefined];
diff --git a/lib/core/mergeConfig.js b/lib/core/mergeConfig.js
new file mode 100644
index 0000000..6097a3e
--- /dev/null
+++ b/lib/core/mergeConfig.js
@@ -0,0 +1,51 @@
+'use strict';
+
+var utils = require('../utils');
+
+/**
+ * Config-specific merge-function which creates a new config-object
+ * by merging two configuration objects together.
+ *
+ * @param {Object} config1
+ * @param {Object} config2
+ * @returns {Object} New object resulting from merging config2 to config1
+ */
+module.exports = function mergeConfig(config1, config2) {
+  // eslint-disable-next-line no-param-reassign
+  config2 = config2 || {};
+  var config = {};
+
+  utils.forEach(['url', 'method', 'params', 'data'], function valueFromConfig2(prop) {
+    if (typeof config2[prop] !== 'undefined') {
+      config[prop] = config2[prop];
+    }
+  });
+
+  utils.forEach(['headers', 'auth', 'proxy'], function mergeDeepProperties(prop) {
+    if (utils.isObject(config2[prop])) {
+      config[prop] = utils.deepMerge(config1[prop], config2[prop]);
+    } else if (typeof config2[prop] !== 'undefined') {
+      config[prop] = config2[prop];
+    } else if (utils.isObject(config1[prop])) {
+      config[prop] = utils.deepMerge(config1[prop]);
+    } else if (typeof config1[prop] !== 'undefined') {
+      config[prop] = config1[prop];
+    }
+  });
+
+  utils.forEach([
+    'baseURL', 'transformRequest', 'transformResponse', 'paramsSerializer',
+    'timeout', 'withCredentials', 'adapter', 'responseType', 'xsrfCookieName',
+    'xsrfHeaderName', 'onUploadProgress', 'onDownloadProgress', 'maxContentLength',
+    'validateStatus', 'maxRedirects', 'httpAgent', 'httpsAgent', 'cancelToken',
+    'socketPath'
+  ], function defaultToConfig2(prop) {
+    if (typeof config2[prop] !== 'undefined') {
+      config[prop] = config2[prop];
+    } else if (typeof config1[prop] !== 'undefined') {
+      config[prop] = config1[prop];
+    }
+  });
+
+  return config;
+};
diff --git a/lib/defaults.js b/lib/defaults.js
index e1bc1ca..65a25d5 100644
--- a/lib/defaults.js
+++ b/lib/defaults.js
@@ -26,7 +26,6 @@ function getDefaultAdapter() {
 }
 
 var defaults = {
-  method: 'get',
   adapter: getDefaultAdapter(),
 
   transformRequest: [function transformRequest(data, headers) {
diff --git a/lib/utils.js b/lib/utils.js
index b3fd865..aca5f4e 100644
--- a/lib/utils.js
+++ b/lib/utils.js
@@ -260,6 +260,32 @@ function merge(/* obj1, obj2, obj3, ... */) {
   return result;
 }
 
+/**
+ * Function equal to merge with the difference being that no reference
+ * to original objects is kept.
+ *
+ * @see merge
+ * @param {Object} obj1 Object to merge
+ * @returns {Object} Result of all merge properties
+ */
+function deepMerge(/* obj1, obj2, obj3, ... */) {
+  var result = {};
+  function assignValue(val, key) {
+    if (typeof result[key] === 'object' && typeof val === 'object') {
+      result[key] = deepMerge(result[key], val);
+    } else if (typeof val === 'object') {
+      result[key] = deepMerge({}, val);
+    } else {
+      result[key] = val;
+    }
+  }
+
+  for (var i = 0, l = arguments.length; i < l; i++) {
+    forEach(arguments[i], assignValue);
+  }
+  return result;
+}
+
 /**
  * Extends object a by mutably adding to it the properties of object b.
  *
@@ -298,6 +324,7 @@ module.exports = {
   isStandardBrowserEnv: isStandardBrowserEnv,
   forEach: forEach,
   merge: merge,
+  deepMerge: deepMerge,
   extend: extend,
   trim: trim
 };
diff --git a/test/specs/core/mergeConfig.spec.js b/test/specs/core/mergeConfig.spec.js
new file mode 100644
index 0000000..bf6d209
--- /dev/null
+++ b/test/specs/core/mergeConfig.spec.js
@@ -0,0 +1,69 @@
+var defaults = require('../../../lib/defaults');
+var mergeConfig = require('../../../lib/core/mergeConfig');
+
+describe('core::mergeConfig', function() {
+  it('should accept undefined for second argument', function() {
+    expect(mergeConfig(defaults, undefined)).toEqual(defaults);
+  });
+
+  it('should accept an object for second argument', function() {
+    expect(mergeConfig(defaults, {})).toEqual(defaults);
+  });
+
+  it('should not leave references', function() {
+    var merged = mergeConfig(defaults, {});
+    expect(merged).not.toBe(defaults);
+    expect(merged.headers).not.toBe(defaults.headers);
+  });
+
+  it('should allow setting request options', function() {
+    var config = {
+      url: '__sample url__',
+      method: '__sample method__',
+      params: '__sample params__',
+      data: { foo: true }
+    };
+    var merged = mergeConfig(defaults, config);
+    expect(merged.url).toEqual(config.url);
+    expect(merged.method).toEqual(config.method);
+    expect(merged.params).toEqual(config.params);
+    expect(merged.data).toEqual(config.data);
+  });
+
+  it('should not inherit request options', function() {
+    var localDefaults = {
+      url: '__sample url__',
+      method: '__sample method__',
+      params: '__sample params__',
+      data: { foo: true }
+    };
+    var merged = mergeConfig(localDefaults, {});
+    expect(merged.url).toEqual(undefined);
+    expect(merged.method).toEqual(undefined);
+    expect(merged.params).toEqual(undefined);
+    expect(merged.data).toEqual(undefined);
+  });
+
+  it('should merge auth, headers, proxy with defaults', function() {
+    expect(mergeConfig({ auth: undefined }, { auth: { user: 'foo', pass: 'test' } })).toEqual({
+      auth: { user: 'foo', pass: 'test' }
+    });
+    expect(mergeConfig({ auth: { user: 'foo', pass: 'test' } }, { auth: { pass: 'foobar' } })).toEqual({
+      auth: { user: 'foo', pass: 'foobar' }
+    });
+  });
+
+  it('should overwrite auth, headers, proxy with a non-object value', function() {
+    expect(mergeConfig({ auth: { user: 'foo', pass: 'test' } }, { auth: false })).toEqual({
+      auth: false
+    });
+    expect(mergeConfig({ auth: { user: 'foo', pass: 'test' } }, { auth: null })).toEqual({
+      auth: null
+    });
+  });
+
+  it('should allow setting other options', function() {
+    var merged = mergeConfig(defaults, { timeout: 123 });
+    expect(merged.timeout).toEqual(123);
+  });
+});
diff --git a/test/specs/defaults.spec.js b/test/specs/defaults.spec.js
index de19b6a..c8ee72e 100644
--- a/test/specs/defaults.spec.js
+++ b/test/specs/defaults.spec.js
@@ -148,14 +148,14 @@ describe('defaults', function () {
     });
   });
 
-  it('should be used by custom instance if set after instance created', function (done) {
+  it('should not be used by custom instance if set after instance created', function (done) {
     var instance = axios.create();
     axios.defaults.baseURL = 'http://example.org/';
 
     instance.get('/foo');
 
     getAjaxRequest().then(function (request) {
-      expect(request.url).toBe('http://example.org/foo');
+      expect(request.url).toBe('/foo');
       done();
     });
   });
diff --git a/test/specs/options.spec.js b/test/specs/options.spec.js
index 6520b8a..762b851 100644
--- a/test/specs/options.spec.js
+++ b/test/specs/options.spec.js
@@ -81,4 +81,32 @@ describe('options', function () {
       done();
     });
   });
+
+  it('should change only the baseURL of the specified instance', function() {
+    var instance1 = axios.create();
+    var instance2 = axios.create();
+
+    instance1.defaults.baseURL = 'http://instance1.example.com/';
+
+    expect(instance2.defaults.baseURL).not.toBe('http://instance1.example.com/');
+  });
+
+  it('should change only the headers of the specified instance', function() {
+    var instance1 = axios.create();
+    var instance2 = axios.create();
+
+    instance1.defaults.headers.common.Authorization = 'faketoken';
+    instance2.defaults.headers.common.Authorization = 'differentfaketoken';
+
+    instance1.defaults.headers.common['Content-Type'] = 'application/xml';
+    instance2.defaults.headers.common['Content-Type'] = 'application/x-www-form-urlencoded';
+
+    expect(axios.defaults.headers.common.Authorization).toBe(undefined);
+    expect(instance1.defaults.headers.common.Authorization).toBe('faketoken');
+    expect(instance2.defaults.headers.common.Authorization).toBe('differentfaketoken');
+
+    expect(axios.defaults.headers.common['Content-Type']).toBe(undefined);
+    expect(instance1.defaults.headers.common['Content-Type']).toBe('application/xml');
+    expect(instance2.defaults.headers.common['Content-Type']).toBe('application/x-www-form-urlencoded');
+  });
 });
diff --git a/test/specs/utils/deepMerge.spec.js b/test/specs/utils/deepMerge.spec.js
new file mode 100644
index 0000000..d879593
--- /dev/null
+++ b/test/specs/utils/deepMerge.spec.js
@@ -0,0 +1,66 @@
+var deepMerge = require('../../../lib/utils').deepMerge;
+
+describe('utils::deepMerge', function () {
+  it('should be immutable', function () {
+    var a = {};
+    var b = {foo: 123};
+    var c = {bar: 456};
+
+    deepMerge(a, b, c);
+
+    expect(typeof a.foo).toEqual('undefined');
+    expect(typeof a.bar).toEqual('undefined');
+    expect(typeof b.bar).toEqual('undefined');
+    expect(typeof c.foo).toEqual('undefined');
+  });
+
+  it('should deepMerge properties', function () {
+    var a = {foo: 123};
+    var b = {bar: 456};
+    var c = {foo: 789};
+    var d = deepMerge(a, b, c);
+
+    expect(d.foo).toEqual(789);
+    expect(d.bar).toEqual(456);
+  });
+
+  it('should deepMerge recursively', function () {
+    var a = {foo: {bar: 123}};
+    var b = {foo: {baz: 456}, bar: {qux: 789}};
+
+    expect(deepMerge(a, b)).toEqual({
+      foo: {
+        bar: 123,
+        baz: 456
+      },
+      bar: {
+        qux: 789
+      }
+    });
+  });
+
+  it('should remove all references from nested objects', function () {
+    var a = {foo: {bar: 123}};
+    var b = {};
+    var d = deepMerge(a, b);
+
+    expect(d).toEqual({
+      foo: {
+        bar: 123
+      }
+    });
+
+    expect(d.foo).not.toBe(a.foo);
+  });
+
+  it('handles null and undefined arguments', function () {
+    expect(deepMerge(undefined, undefined)).toEqual({});
+    expect(deepMerge(undefined, {foo: 123})).toEqual({foo: 123});
+    expect(deepMerge({foo: 123}, undefined)).toEqual({foo: 123});
+
+    expect(deepMerge(null, null)).toEqual({});
+    expect(deepMerge(null, {foo: 123})).toEqual({foo: 123});
+    expect(deepMerge({foo: 123}, null)).toEqual({foo: 123});
+  });
+});
+