diff --git a/lib/connectors/memory.js b/lib/connectors/memory.js
index e3eea27d..01f012c2 100644
--- a/lib/connectors/memory.js
+++ b/lib/connectors/memory.js
@@ -23,7 +23,8 @@ var debug = require('debug')('loopback:connector:memory');
  */
 exports.initialize = function initializeDataSource(dataSource, callback) {
   dataSource.connector = new Memory(null, dataSource.settings);
-  dataSource.connector.connect(callback);
+  // Use dataSource.connect to avoid duplicate file reads from cache
+  dataSource.connect(callback);
 };
 
 exports.Memory = Memory;
diff --git a/lib/datasource.js b/lib/datasource.js
index 51e92615..9b53bfeb 100644
--- a/lib/datasource.js
+++ b/lib/datasource.js
@@ -263,6 +263,65 @@ DataSource._resolveConnector = function(name, loader) {
   };
 };
 
+/**
+ * Connect to the data source
+ * @param callback
+ */
+DataSource.prototype.connect = function(callback) {
+  callback = callback || utils.createPromiseCallback();
+  var self = this;
+  if (this.connected) {
+    // The data source is already connected, return immediately
+    process.nextTick(callback);
+    return callback.promise;
+  }
+  if (typeof this.connector.connect !== 'function') {
+    // Connector doesn't have the connect function
+    // Assume no connect is needed
+    self.connected = true;
+    self.connecting = false;
+    process.nextTick(function() {
+      self.emit('connected');
+      callback();
+    });
+    return callback.promise;
+  }
+
+  // Queue the callback
+  this.pendingConnectCallbacks = this.pendingConnectCallbacks || [];
+  this.pendingConnectCallbacks.push(callback);
+
+  // The connect is already in progress
+  if (this.connecting) return callback.promise;
+  // Set connecting flag to be true
+  this.connecting = true;
+  this.connector.connect(function(err, result) {
+    self.connecting = false;
+    if (!err) self.connected = true;
+    var cbs = self.pendingConnectCallbacks;
+    self.pendingConnectCallbacks = [];
+    if (!err) {
+      self.emit('connected');
+    } else {
+      self.emit('error', err);
+    }
+    // Invoke all pending callbacks
+    async.each(cbs, function(cb, done) {
+      try {
+        cb(err);
+      } catch (e) {
+        // Ignore error to make sure all callbacks are invoked
+        debug('Uncaught error raised by connect callback function: ', e);
+      } finally {
+        done();
+      }
+    }, function(err) {
+      if (err) throw err; // It should not happen
+    });
+  });
+  return callback.promise;
+};
+
 /**
  * Set up the data source
  * @param {String} name The name
@@ -364,61 +423,6 @@ DataSource.prototype.setup = function(name, settings) {
       throw err;
     }
   }
-
-  dataSource.connect = function(callback) {
-    callback = callback || utils.createPromiseCallback();
-    var self = this;
-    if (this.connected) {
-      // The data source is already connected, return immediately
-      process.nextTick(callback);
-      return callback.promise;
-    }
-    if (typeof dataSource.connector.connect !== 'function') {
-      // Connector doesn't have the connect function
-      // Assume no connect is needed
-      self.connected = true;
-      self.connecting = false;
-      process.nextTick(function() {
-        self.emit('connected');
-        callback();
-      });
-      return callback.promise;
-    }
-
-    // Queue the callback
-    this.pendingConnectCallbacks = this.pendingConnectCallbacks || [];
-    this.pendingConnectCallbacks.push(callback);
-
-    // The connect is already in progress
-    if (this.connecting) return callback.promise;
-    // Set connecting flag to be true
-    this.connecting = true;
-    this.connector.connect(function(err, result) {
-      self.connecting = false;
-      if (!err) self.connected = true;
-      var cbs = self.pendingConnectCallbacks;
-      self.pendingConnectCallbacks = [];
-      if (!err) {
-        self.emit('connected');
-      } else {
-        self.emit('error', err);
-      }
-      // Invoke all pending callbacks
-      async.each(cbs, function(cb, done) {
-        try {
-          cb(err);
-        } catch (e) {
-          // Ignore error to make sure all callbacks are invoked
-          debug('Uncaught error raised by connect callback function: ', e);
-        } finally {
-          done();
-        }
-      }, function(err) {
-        if (err) throw err; // It should not happen
-      });
-    });
-    return callback.promise;
-  };
 };
 
 function isModelClass(cls) {
@@ -1924,6 +1928,7 @@ DataSource.prototype.disconnect = function disconnect(cb) {
     });
   } else {
     process.nextTick(function() {
+      self.connected = false;
       cb && cb();
     });
   }
diff --git a/test/memory.test.js b/test/memory.test.js
index b6a4fd88..ef902d8f 100644
--- a/test/memory.test.js
+++ b/test/memory.test.js
@@ -37,7 +37,7 @@ describe('Memory connector', function() {
     var ds;
 
     function createUserModel() {
-      ds = new DataSource({
+      var ds = new DataSource({
         connector: 'memory',
         file: file,
       });
@@ -62,6 +62,7 @@ describe('Memory connector', function() {
 
     before(function() {
       User = createUserModel();
+      ds = User.dataSource;
     });
 
     it('should allow multiple connects', function(done) {
@@ -92,9 +93,10 @@ describe('Memory connector', function() {
      * newly created ones.
      */
     it('should not have out of sequence read/write', function(done) {
-      ds.connected = false;
-      ds.connector.connected = false; // Change the state to force reconnect
-      ds.connector.cache = {};
+      // Create the new data source with the same file to simulate
+      // existing records
+      var User = createUserModel();
+      var ds = User.dataSource;
 
       async.times(10, function(n, next) {
         if (n === 10) {
@@ -121,17 +123,21 @@ describe('Memory connector', function() {
     });
 
     it('should persist delete', function(done) {
-      // Now try to delete one
-      User.deleteById(ids[0], function(err) {
-        if (err) {
-          return done(err);
-        }
-        readModels(function(err, json) {
+      // Force the data source to reconnect so that the updated records
+      // are reloaded
+      ds.disconnect(function() {
+        // Now try to delete one
+        User.deleteById(ids[0], function(err) {
           if (err) {
             return done(err);
           }
-          assert.equal(Object.keys(json.models.User).length, 4);
-          done();
+          readModels(function(err, json) {
+            if (err) {
+              return done(err);
+            }
+            assert.equal(Object.keys(json.models.User).length, 4);
+            done();
+          });
         });
       });
     });