diff --git a/xarray/core/dataset.py b/xarray/core/dataset.py
index d5f5e91b8a8..660a349e06d 100644
--- a/xarray/core/dataset.py
+++ b/xarray/core/dataset.py
@@ -253,6 +253,11 @@ def _set_init_vars_and_dims(self, vars, coords, compat):
         """
         _assert_empty([k for k in vars if k in coords],
                       'redundant variables and coordinates: %s')
+
+        # Need to coerce Series to a dict as it doesn't implement __iter__ like a mapping
+        # GH470
+        vars = dict(vars) if isinstance(vars, pd.Series) else vars
+
         variables = ChainMap(vars, coords)
 
         aligned = align_variables(variables)
diff --git a/xarray/test/test_dataset.py b/xarray/test/test_dataset.py
index 1e5b93c243f..5d27cce4b69 100644
--- a/xarray/test/test_dataset.py
+++ b/xarray/test/test_dataset.py
@@ -217,6 +217,7 @@ def test_constructor_pandas_sequence(self):
     def test_constructor_pandas_single(self):
 
         das = [
+            DataArray(np.random.rand(4), dims=['a']),  # series
             DataArray(np.random.rand(4,3), dims=['a', 'b']),  # df
             DataArray(np.random.rand(4,3,2), dims=['a','b','c']), # panel
             ]