Pervasive computing is an emerging computing paradigm that provides intelligent context-aware applications. Such applications handle contextual information in order to determine the current user's situation. Contextual information is typically inaccurate (e.g., noise of sensor readings). A novel context fusion engine* that models, determines and reasons about the current user's situation is proposed. This engine, based on dynamic Bayesian networks and fuzzy logic, deals with the reliability of sources and approximate contextual reasoning.