diff --git a/src/main/java/com/google/devtools/build/lib/rules/repository/RepositoryFunction.java b/src/main/java/com/google/devtools/build/lib/rules/repository/RepositoryFunction.java
index ee2141d..f37ca6e 100644
--- a/src/main/java/com/google/devtools/build/lib/rules/repository/RepositoryFunction.java
+++ b/src/main/java/com/google/devtools/build/lib/rules/repository/RepositoryFunction.java
@@ -508,7 +508,7 @@
    * encourage nor optimize for since it is not common. So the set of external files is small.
    */
   public static void addExternalFilesDependencies(
-      RootedPath rootedPath, BlazeDirectories directories, Environment env)
+      RootedPath rootedPath, boolean isDirectory, BlazeDirectories directories, Environment env)
       throws IOException, InterruptedException {
     Path externalRepoDir = getExternalRepositoryDirectory(directories);
     PathFragment repositoryPath = rootedPath.asPath().relativeTo(externalRepoDir);
@@ -531,8 +531,9 @@
         return;
       }
 
-      if (repositoryPath.segmentCount() > 1) {
-        if (rule.getRuleClass().equals(LocalRepositoryRule.NAME)
+      if (isDirectory || repositoryPath.segmentCount() > 1) {
+        if (!isDirectory
+            && rule.getRuleClass().equals(LocalRepositoryRule.NAME)
             && repositoryPath.endsWith(BuildFileName.WORKSPACE.getFilenameFragment())) {
           // Ignore this, there is a dependency from LocalRepositoryFunction->WORKSPACE file already
           return;
diff --git a/src/main/java/com/google/devtools/build/lib/skyframe/DirectoryListingStateFunction.java b/src/main/java/com/google/devtools/build/lib/skyframe/DirectoryListingStateFunction.java
index 49a6aaa..c3d3ce9 100644
--- a/src/main/java/com/google/devtools/build/lib/skyframe/DirectoryListingStateFunction.java
+++ b/src/main/java/com/google/devtools/build/lib/skyframe/DirectoryListingStateFunction.java
@@ -51,7 +51,7 @@
     RootedPath dirRootedPath = (RootedPath) skyKey.argument();
 
     try {
-      externalFilesHelper.maybeHandleExternalFile(dirRootedPath, env);
+      externalFilesHelper.maybeHandleExternalFile(dirRootedPath, true, env);
       if (env.valuesMissing()) {
         return null;
       }
diff --git a/src/main/java/com/google/devtools/build/lib/skyframe/ExternalFilesHelper.java b/src/main/java/com/google/devtools/build/lib/skyframe/ExternalFilesHelper.java
index aa7f036..abc7577 100644
--- a/src/main/java/com/google/devtools/build/lib/skyframe/ExternalFilesHelper.java
+++ b/src/main/java/com/google/devtools/build/lib/skyframe/ExternalFilesHelper.java
@@ -197,15 +197,15 @@
   }
 
   /**
-   * If this instance is configured with
-   * {@link ExternalFileAction#DEPEND_ON_EXTERNAL_PKG_FOR_EXTERNAL_REPO_PATHS} and
-   * {@code rootedPath} isn't under a package root then this adds a dependency on the //external
-   * package. If the action is
+   * If this instance is configured with {@link
+   * ExternalFileAction#DEPEND_ON_EXTERNAL_PKG_FOR_EXTERNAL_REPO_PATHS} and {@code rootedPath} isn't
+   * under a package root then this adds a dependency on the //external package. If the action is
    * {@link ExternalFileAction#ASSUME_NON_EXISTENT_AND_IMMUTABLE_FOR_EXTERNAL_PATHS}, it will throw
    * a {@link NonexistentImmutableExternalFileException} instead.
    */
   @ThreadSafe
-  void maybeHandleExternalFile(RootedPath rootedPath, SkyFunction.Environment env)
+  void maybeHandleExternalFile(
+      RootedPath rootedPath, boolean isDirectory, SkyFunction.Environment env)
       throws NonexistentImmutableExternalFileException, IOException, InterruptedException {
     FileType fileType = getAndNoteFileType(rootedPath);
     if (fileType == FileType.INTERNAL) {
@@ -225,6 +225,6 @@
     Preconditions.checkState(
         externalFileAction == ExternalFileAction.DEPEND_ON_EXTERNAL_PKG_FOR_EXTERNAL_REPO_PATHS,
         externalFileAction);
-    RepositoryFunction.addExternalFilesDependencies(rootedPath, directories, env);
+    RepositoryFunction.addExternalFilesDependencies(rootedPath, isDirectory, directories, env);
   }
 }
diff --git a/src/main/java/com/google/devtools/build/lib/skyframe/FileStateFunction.java b/src/main/java/com/google/devtools/build/lib/skyframe/FileStateFunction.java
index 15b8763..940b2d7 100644
--- a/src/main/java/com/google/devtools/build/lib/skyframe/FileStateFunction.java
+++ b/src/main/java/com/google/devtools/build/lib/skyframe/FileStateFunction.java
@@ -45,7 +45,7 @@
     RootedPath rootedPath = (RootedPath) skyKey.argument();
 
     try {
-      externalFilesHelper.maybeHandleExternalFile(rootedPath, env);
+      externalFilesHelper.maybeHandleExternalFile(rootedPath, false, env);
       if (env.valuesMissing()) {
         return null;
       }
diff --git a/src/test/shell/bazel/BUILD b/src/test/shell/bazel/BUILD
index ec18516..885836b 100644
--- a/src/test/shell/bazel/BUILD
+++ b/src/test/shell/bazel/BUILD
@@ -816,3 +816,10 @@
     data = [":test-deps"],
     deps = ["@bazel_tools//tools/bash/runfiles"],
 )
+
+sh_test(
+    name = "new_local_repo_test",
+    srcs = ["new_local_repo_test.sh"],
+    data = [":test-deps"],
+    deps = ["@bazel_tools//tools/bash/runfiles"],
+)
diff --git a/src/test/shell/bazel/new_local_repo_test.sh b/src/test/shell/bazel/new_local_repo_test.sh
new file mode 100755
index 0000000..c41f65b
--- /dev/null
+++ b/src/test/shell/bazel/new_local_repo_test.sh
@@ -0,0 +1,113 @@
+#!/bin/bash
+#
+# Copyright 2019 The Bazel Authors. All rights reserved.
+#
+# Licensed under the Apache License, Version 2.0 (the "License");
+# you may not use this file except in compliance with the License.
+# You may obtain a copy of the License at
+#
+#    http://www.apache.org/licenses/LICENSE-2.0
+#
+# Unless required by applicable law or agreed to in writing, software
+# distributed under the License is distributed on an "AS IS" BASIS,
+# WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+# See the License for the specific language governing permissions and
+# limitations under the License.
+
+# --- begin runfiles.bash initialization ---
+# Copy-pasted from Bazel's Bash runfiles library (tools/bash/runfiles/runfiles.bash).
+set -euo pipefail
+if [[ ! -d "${RUNFILES_DIR:-/dev/null}" && ! -f "${RUNFILES_MANIFEST_FILE:-/dev/null}" ]]; then
+  if [[ -f "$0.runfiles_manifest" ]]; then
+    export RUNFILES_MANIFEST_FILE="$0.runfiles_manifest"
+  elif [[ -f "$0.runfiles/MANIFEST" ]]; then
+    export RUNFILES_MANIFEST_FILE="$0.runfiles/MANIFEST"
+  elif [[ -f "$0.runfiles/bazel_tools/tools/bash/runfiles/runfiles.bash" ]]; then
+    export RUNFILES_DIR="$0.runfiles"
+  fi
+fi
+if [[ -f "${RUNFILES_DIR:-/dev/null}/bazel_tools/tools/bash/runfiles/runfiles.bash" ]]; then
+  source "${RUNFILES_DIR}/bazel_tools/tools/bash/runfiles/runfiles.bash"
+elif [[ -f "${RUNFILES_MANIFEST_FILE:-/dev/null}" ]]; then
+  source "$(grep -m1 "^bazel_tools/tools/bash/runfiles/runfiles.bash " \
+            "$RUNFILES_MANIFEST_FILE" | cut -d ' ' -f 2-)"
+else
+  echo >&2 "ERROR: cannot find @bazel_tools//tools/bash/runfiles:runfiles.bash"
+  exit 1
+fi
+# --- end runfiles.bash initialization ---
+
+source "$(rlocation "io_bazel/src/test/shell/integration_test_setup.sh")" \
+  || { echo "integration_test_setup.sh not found!" >&2; exit 1; }
+
+# `uname` returns the current platform, e.g "MSYS_NT-10.0" or "Linux".
+# `tr` converts all upper case letters to lower case.
+# `case` matches the result if the `uname | tr` expression to string prefixes
+# that use the same wildcards as names do in Bash, i.e. "msys*" matches strings
+# starting with "msys", and "*" matches everything (it's the default case).
+case "$(uname -s | tr [:upper:] [:lower:])" in
+msys*)
+  # As of 2019-02-20, Bazel on Windows only supports MSYS Bash.
+  declare -r is_windows=true
+  ;;
+*)
+  declare -r is_windows=false
+  ;;
+esac
+
+if "$is_windows"; then
+  # Disable MSYS path conversion that converts path-looking command arguments to
+  # Windows paths (even if they arguments are not in fact paths).
+  export MSYS_NO_PATHCONV=1
+  export MSYS2_ARG_CONV_EXCL="*"
+fi
+
+# Regression test for GitHub issue #6351, see
+# https://github.com/bazelbuild/bazel/issues/6351#issuecomment-465488344
+function test_glob_in_synthesized_build_file() {
+  local -r pkg=${FUNCNAME[0]}
+  mkdir $pkg || fail "mkdir $pkg"
+  mkdir $pkg/A || fail "mkdir $pkg/A"
+  mkdir $pkg/B || fail "mkdir $pkg/B"
+
+  cat >$pkg/A/WORKSPACE <<'eof'
+new_local_repository(
+    name = "B",
+    build_file_content = """
+filegroup(
+    name = "F",
+    srcs = glob(["*.txt"]),
+    visibility = ["//visibility:public"],
+)
+""",
+    path = "../B",
+)
+eof
+
+  cat >$pkg/A/BUILD <<'eof'
+genrule(
+    name = "G",
+    srcs = ["@B//:F"],
+    outs = ["g.txt"],
+    cmd = "echo $(SRCS) > $@",
+)
+eof
+
+  echo "dummy" >$pkg/B/a.txt
+
+  # Build 1: g.txt should contain external/B/a.txt
+  cd $pkg/A
+  bazel build //:G || fail "build failed"
+  cat bazel-genfiles/g.txt >$TEST_log
+  expect_log "external/B/a.txt"
+  expect_not_log "external/B/b.txt"
+
+  # Build 2: add B/b.txt and see if the glob picks it up.
+  echo "dummy" > ../B/b.txt
+  bazel build //:G || fail "build failed"
+  cat bazel-genfiles/g.txt >$TEST_log
+  expect_log "external/B/a.txt"
+  expect_log "external/B/b.txt"
+}
+
+run_suite "new_local_repository correctness tests"