diff --git a/core/src/test/resources/fairscheduler-with-valid-data.xml b/core/src/test/resources/fairscheduler-with-valid-data.xml
new file mode 100644
index 0000000000000..3d882331835ca
--- /dev/null
+++ b/core/src/test/resources/fairscheduler-with-valid-data.xml
@@ -0,0 +1,35 @@
+<?xml version="1.0"?>
+<!--
+  ~ Licensed to the Apache Software Foundation (ASF) under one or more
+  ~ contributor license agreements.  See the NOTICE file distributed with
+  ~ this work for additional information regarding copyright ownership.
+  ~ The ASF licenses this file to You 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.
+  -->
+
+<allocations>
+    <pool name="pool1">
+        <minShare>3</minShare>
+        <weight>1</weight>
+        <schedulingMode>FIFO</schedulingMode>
+    </pool>
+    <pool name="pool2">
+        <minShare>4</minShare>
+        <weight>2</weight>
+        <schedulingMode>FAIR</schedulingMode>
+    </pool>
+    <pool name="pool3">
+        <minShare>2</minShare>
+        <weight>3</weight>
+        <schedulingMode>FAIR</schedulingMode>
+    </pool>
+</allocations>
\ No newline at end of file
diff --git a/core/src/test/scala/org/apache/spark/scheduler/PoolSuite.scala b/core/src/test/scala/org/apache/spark/scheduler/PoolSuite.scala
index 4901062a78553..5bd3955f5adbb 100644
--- a/core/src/test/scala/org/apache/spark/scheduler/PoolSuite.scala
+++ b/core/src/test/scala/org/apache/spark/scheduler/PoolSuite.scala
@@ -17,6 +17,7 @@
 
 package org.apache.spark.scheduler
 
+import java.io.FileNotFoundException
 import java.util.Properties
 
 import org.apache.spark.{LocalSparkContext, SparkConf, SparkContext, SparkFunSuite}
@@ -292,6 +293,49 @@ class PoolSuite extends SparkFunSuite with LocalSparkContext {
     }
   }
 
+  test("Fair Scheduler should build fair scheduler when " +
+    "valid spark.scheduler.allocation.file property is set") {
+    val xmlPath = getClass.getClassLoader.getResource("fairscheduler-with-valid-data.xml").getFile()
+    val conf = new SparkConf().set(SCHEDULER_ALLOCATION_FILE_PROPERTY, xmlPath)
+    sc = new SparkContext(LOCAL, APP_NAME, conf)
+
+    val rootPool = new Pool("", SchedulingMode.FAIR, 0, 0)
+    val schedulableBuilder = new FairSchedulableBuilder(rootPool, sc.conf)
+    schedulableBuilder.buildPools()
+
+    verifyPool(rootPool, schedulableBuilder.DEFAULT_POOL_NAME, 0, 1, FIFO)
+    verifyPool(rootPool, "pool1", 3, 1, FIFO)
+    verifyPool(rootPool, "pool2", 4, 2, FAIR)
+    verifyPool(rootPool, "pool3", 2, 3, FAIR)
+  }
+
+  test("Fair Scheduler should use default file(fairscheduler.xml) if it exists in classpath " +
+    "and spark.scheduler.allocation.file property is not set") {
+    val conf = new SparkConf()
+    sc = new SparkContext(LOCAL, APP_NAME, conf)
+
+    val rootPool = new Pool("", SchedulingMode.FAIR, 0, 0)
+    val schedulableBuilder = new FairSchedulableBuilder(rootPool, sc.conf)
+    schedulableBuilder.buildPools()
+
+    verifyPool(rootPool, schedulableBuilder.DEFAULT_POOL_NAME, 0, 1, FIFO)
+    verifyPool(rootPool, "1", 2, 1, FIFO)
+    verifyPool(rootPool, "2", 3, 1, FIFO)
+    verifyPool(rootPool, "3", 0, 1, FIFO)
+  }
+
+  test("Fair Scheduler should throw FileNotFoundException " +
+    "when invalid spark.scheduler.allocation.file property is set") {
+    val conf = new SparkConf().set(SCHEDULER_ALLOCATION_FILE_PROPERTY, "INVALID_FILE_PATH")
+    sc = new SparkContext(LOCAL, APP_NAME, conf)
+
+    val rootPool = new Pool("", SchedulingMode.FAIR, 0, 0)
+    val schedulableBuilder = new FairSchedulableBuilder(rootPool, sc.conf)
+    intercept[FileNotFoundException] {
+      schedulableBuilder.buildPools()
+    }
+  }
+
   private def verifyPool(rootPool: Pool, poolName: String, expectedInitMinShare: Int,
                          expectedInitWeight: Int, expectedSchedulingMode: SchedulingMode): Unit = {
     val selectedPool = rootPool.getSchedulableByName(poolName)
diff --git a/docs/job-scheduling.md b/docs/job-scheduling.md
index 807944f20a78a..e6d881639a13b 100644
--- a/docs/job-scheduling.md
+++ b/docs/job-scheduling.md
@@ -235,7 +235,7 @@ properties:
   of the cluster. By default, each pool's `minShare` is 0.
 
 The pool properties can be set by creating an XML file, similar to `conf/fairscheduler.xml.template`,
-and setting a `spark.scheduler.allocation.file` property in your
+and either putting a file named `fairscheduler.xml` on the classpath, or setting `spark.scheduler.allocation.file` property in your
 [SparkConf](configuration.html#spark-properties).
 
 {% highlight scala %}