diff --git a/releasenotes/notes/delete_project-399f9b3107014dde.yaml b/releasenotes/notes/delete_project-399f9b3107014dde.yaml
new file mode 100644
index 000000000..e4cf39fb9
--- /dev/null
+++ b/releasenotes/notes/delete_project-399f9b3107014dde.yaml
@@ -0,0 +1,5 @@
+---
+fixes:
+  - The delete_project() API now conforms to our standard of returning True
+    when the delete succeeds, or False when the project was not found. It
+    would previously raise an expection if the project was not found.
diff --git a/shade/openstackcloud.py b/shade/openstackcloud.py
index 76b3484f1..0d1818d3f 100644
--- a/shade/openstackcloud.py
+++ b/shade/openstackcloud.py
@@ -519,10 +519,25 @@ class OpenStackCloud(object):
         return project
 
     def delete_project(self, name_or_id):
+        """Delete a project
+
+        :param string name_or_id: Project name or id.
+
+        :returns: True if delete succeeded, False if the project was not found.
+
+        :raises: ``OpenStackCloudException`` if something goes wrong during
+            the openstack API call
+        """
+
         with _utils.shade_exceptions(
                 "Error in deleting project {project}".format(
                     project=name_or_id)):
             project = self.get_project(name_or_id)
+            if project is None:
+                self.log.debug(
+                    "Project {0} not found for deleting".format(name_or_id))
+                return False
+
             params = {}
             if self.cloud_config.get_api_version('identity') == '3':
                 params['project'] = project['id']
@@ -530,6 +545,8 @@ class OpenStackCloud(object):
                 params['tenant'] = project['id']
             self.manager.submitTask(_tasks.ProjectDelete(**params))
 
+        return True
+
     @_utils.cache_on_arguments()
     def list_users(self):
         """List Keystone Users.
diff --git a/shade/tests/functional/test_project.py b/shade/tests/functional/test_project.py
new file mode 100644
index 000000000..029b14895
--- /dev/null
+++ b/shade/tests/functional/test_project.py
@@ -0,0 +1,77 @@
+# Copyright (c) 2016 IBM
+#
+# Licensed under the Apache License, Version 2.0 (the "License");
+# you may not use this file except in compliance with the License.
+# You may obtain a copy of the License at
+#
+#    http://www.apache.org/licenses/LICENSE-2.0
+#
+# Unless required by applicable law or agreed to in writing, software
+# distributed under the License is distributed on an "AS IS" BASIS,
+# WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or
+# implied.
+#
+# See the License for the specific language governing permissions and
+# limitations under the License.
+
+"""
+test_project
+----------------------------------
+
+Functional tests for `shade` project resource.
+"""
+
+from shade.exc import OpenStackCloudException
+from shade.tests.functional import base
+
+
+class TestProject(base.BaseFunctionalTestCase):
+
+    def setUp(self):
+        super(TestProject, self).setUp()
+        self.new_project_name = self.getUniqueString('project')
+        self.identity_version = \
+            self.operator_cloud.cloud_config.get_api_version('identity')
+        self.addCleanup(self._cleanup_projects)
+
+    def _cleanup_projects(self):
+        exception_list = list()
+        for p in self.operator_cloud.list_projects():
+            if p['name'].startswith(self.new_project_name):
+                try:
+                    self.operator_cloud.delete_project(p['id'])
+                except Exception as e:
+                    exception_list.append(str(e))
+                    continue
+        if exception_list:
+            raise OpenStackCloudException('\n'.join(exception_list))
+
+    def test_create_project(self):
+        project_name = self.new_project_name + '_create'
+
+        params = {
+            'name': project_name,
+            'description': 'test_create_project',
+        }
+        if self.identity_version == '3':
+            params['domain_id'] = \
+                self.operator_cloud.get_domain('default')['id']
+
+        project = self.operator_cloud.create_project(**params)
+
+        self.assertIsNotNone(project)
+        self.assertEqual(project_name, project['name'])
+        self.assertEqual('test_create_project', project['description'])
+
+    def test_delete_project(self):
+        project_name = self.new_project_name + '_delete'
+        params = {'name': project_name}
+        if self.identity_version == '3':
+            params['domain_id'] = \
+                self.operator_cloud.get_domain('default')['id']
+        project = self.operator_cloud.create_project(**params)
+        self.assertIsNotNone(project)
+        self.assertTrue(self.operator_cloud.delete_project(project['id']))
+
+    def test_delete_project_not_found(self):
+        self.assertFalse(self.operator_cloud.delete_project('doesNotExist'))
diff --git a/shade/tests/unit/test_project.py b/shade/tests/unit/test_project.py
index 47d493734..dc1dd7935 100644
--- a/shade/tests/unit/test_project.py
+++ b/shade/tests/unit/test_project.py
@@ -73,7 +73,7 @@ class TestProject(base.TestCase):
                                mock_api_version):
         mock_api_version.return_value = '2'
         mock_get.return_value = dict(id='123')
-        self.cloud.delete_project('123')
+        self.assertTrue(self.cloud.delete_project('123'))
         mock_get.assert_called_once_with('123')
         mock_keystone.tenants.delete.assert_called_once_with(tenant='123')
 
@@ -84,7 +84,7 @@ class TestProject(base.TestCase):
                                mock_api_version):
         mock_api_version.return_value = '3'
         mock_get.return_value = dict(id='123')
-        self.cloud.delete_project('123')
+        self.assertTrue(self.cloud.delete_project('123'))
         mock_get.assert_called_once_with('123')
         mock_keystone.projects.delete.assert_called_once_with(project='123')