diff --git a/heatclient/shell.py b/heatclient/shell.py
index 3aa0e1a1..2793ad51 100644
--- a/heatclient/shell.py
+++ b/heatclient/shell.py
@@ -282,9 +282,12 @@ class HeatShell(object):
             raise exc.CommandError("You must provide a username via"
                                    " either --os-username or env[OS_USERNAME]")
 
-        if not args.os_password:
-            raise exc.CommandError("You must provide a password via"
-                                   " either --os-password or env[OS_PASSWORD]")
+        if not args.os_password and not args.os_auth_token:
+            raise exc.CommandError("You must provide a password or auth token."
+                                   " To provide password use --os-password or "
+                                   "env[OS_PASSWORD]. To provide auth token "
+                                   "use --os-auth-token or "
+                                   "env[OS_AUTH_TOKEN]")
 
         if not (args.os_tenant_id or args.os_tenant_name):
             raise exc.CommandError("You must provide a tenant_id via"
diff --git a/heatclient/tests/test_shell.py b/heatclient/tests/test_shell.py
index 6737237c..25c27a54 100644
--- a/heatclient/tests/test_shell.py
+++ b/heatclient/tests/test_shell.py
@@ -154,6 +154,22 @@ class ShellParamValidationTest(TestCase):
         cmd = '%s --template-file=%s ' % (self.command, template_file)
         self.shell_error(cmd, self.err)
 
+    def test_no_token_no_password(self):
+        self.m.StubOutWithMock(ksclient, 'Client')
+        self.m.StubOutWithMock(v1client.Client, 'json_request')
+
+        self.m.ReplayAll()
+        fake_env = {
+            'OS_USERNAME': 'username',
+            'OS_TENANT_NAME': 'tenant_name',
+            'OS_AUTH_URL': 'http://no.where',
+        }
+        self.set_fake_env(fake_env)
+        template_file = os.path.join(TEST_VAR_DIR, 'minimal.template')
+        cmd = '%s --template-file=%s ' % (self.command, template_file)
+        err = 'You must provide a password or auth token.'
+        self.shell_error(cmd, err)
+
 
 class ShellValidationTest(TestCase):