In this paper we describe an unsupervised method for semantic role induction which holds promise for relieving the data acquisition bottleneck associated with supervised role labelers. We present an algorithm that iteratively splits and merges clusters representing semantic roles, thereby leading from an initial clustering to a final clustering of better quality. The method is simple, surprisingly effective, and allows to integrate linguistic knowledge transparently. By combining role induction with a rule-based component for argument identification we obtain an unsupervised end-to-end semantic role labeling system. Evaluation on the CoNLL 2008 benchmark dataset demonstrates that our method outperforms competitive unsupervised approaches by a wide margin.