Ambient Intelligence is an emerging discipline that requires the integration of expertise from a multitude of scientific fields. The role of Artificial Intelligence is crucial not only for bringing intelligence to everyday environments, but also for providing the means for the different disciplines to collaborate. In this paper we describe the design of a reasoning framework, applied to an operational Ambient Intelligence infrastructure, that combines rule-based reasoning with reasoning about actions and causality on top of ontology-based context models. The emphasis is on identifying the limitations of the rule-based approach and the way action theories can be employed to fill the gaps.