diff --git a/Source/cmExportFileGenerator.cxx b/Source/cmExportFileGenerator.cxx
index 42fce6d40..2db40864d 100644
--- a/Source/cmExportFileGenerator.cxx
+++ b/Source/cmExportFileGenerator.cxx
@@ -277,6 +277,8 @@ static bool checkInterfaceDirs(const std::string &prepro,
            "  \"" << *li << "\"";
       target->GetMakefile()->IssueMessage(messageType, e.str());
       }
+    bool inBinary = isSubDirectory(li->c_str(), topBinaryDir);
+    bool inSource = isSubDirectory(li->c_str(), topSourceDir);
     if (isSubDirectory(li->c_str(), installDir))
       {
       // The include directory is inside the install tree.  If the
@@ -284,8 +286,8 @@ static bool checkInterfaceDirs(const std::string &prepro,
       // fall through to the checks below that the include directory is not
       // also inside the source tree or build tree.
       bool shouldContinue =
-          isSubDirectory(installDir, topBinaryDir)
-        || isSubDirectory(installDir, topSourceDir);
+        (!inBinary || isSubDirectory(installDir, topBinaryDir)) &&
+        (!inSource || isSubDirectory(installDir, topSourceDir));
 
       if (!shouldContinue)
         {
@@ -299,7 +301,10 @@ static bool checkInterfaceDirs(const std::string &prepro,
             s << "Directory:\n    \"" << *li << "\"\nin "
               "INTERFACE_INCLUDE_DIRECTORIES of target \""
               << target->GetName() << "\" is a subdirectory of the install "
-              "directory:\n    \"" << installDir << "\"";
+              "directory:\n    \"" << installDir << "\"\nhowever it is also "
+              "a subdirectory of the " << (inBinary ? "build" : "source")
+              << " tree:\n    \"" << (inBinary ? topBinaryDir : topSourceDir)
+              << "\"" << std::endl;
             target->GetMakefile()->IssueMessage(cmake::AUTHOR_WARNING,
                                                 s.str());
             }
@@ -317,7 +322,7 @@ static bool checkInterfaceDirs(const std::string &prepro,
         continue;
         }
       }
-    if (isSubDirectory(li->c_str(), topBinaryDir))
+    if (inBinary)
       {
       e << "Target \"" << target->GetName() << "\" "
            "INTERFACE_INCLUDE_DIRECTORIES property contains path:\n"
@@ -326,7 +331,7 @@ static bool checkInterfaceDirs(const std::string &prepro,
       }
     if (!inSourceBuild)
       {
-      if (isSubDirectory(li->c_str(), topSourceDir))
+      if (inSource)
         {
         e << "Target \"" << target->GetName() << "\" "
             "INTERFACE_INCLUDE_DIRECTORIES property contains path:\n"
diff --git a/Tests/RunCMake/include_directories/BinInInstallPrefix-CMP0052-WARN-stderr.txt b/Tests/RunCMake/include_directories/BinInInstallPrefix-CMP0052-WARN-stderr.txt
index f6d408c42..054bff595 100644
--- a/Tests/RunCMake/include_directories/BinInInstallPrefix-CMP0052-WARN-stderr.txt
+++ b/Tests/RunCMake/include_directories/BinInInstallPrefix-CMP0052-WARN-stderr.txt
@@ -12,4 +12,9 @@ CMake Warning \(dev\) in CMakeLists.txt:
   of the install directory:
 
       ".*Tests/RunCMake/include_directories/prefix"
+
+  however it is also a subdirectory of the build tree:
+
+      ".*Tests/RunCMake/include_directories/prefix/BinInInstallPrefix-CMP0052-WARN-build"
+
 This warning is for project developers.  Use -Wno-dev to suppress it.
diff --git a/Tests/RunCMake/include_directories/DirInInstallPrefix-result.txt b/Tests/RunCMake/include_directories/DirInInstallPrefix-result.txt
new file mode 100644
index 000000000..573541ac9
--- /dev/null
+++ b/Tests/RunCMake/include_directories/DirInInstallPrefix-result.txt
@@ -0,0 +1 @@
+0
diff --git a/Tests/RunCMake/include_directories/DirInInstallPrefix-stderr.txt b/Tests/RunCMake/include_directories/DirInInstallPrefix-stderr.txt
new file mode 100644
index 000000000..10f32932e
--- /dev/null
+++ b/Tests/RunCMake/include_directories/DirInInstallPrefix-stderr.txt
@@ -0,0 +1 @@
+^$
diff --git a/Tests/RunCMake/include_directories/DirInInstallPrefix.cmake b/Tests/RunCMake/include_directories/DirInInstallPrefix.cmake
new file mode 100644
index 000000000..d6f08bd10
--- /dev/null
+++ b/Tests/RunCMake/include_directories/DirInInstallPrefix.cmake
@@ -0,0 +1,9 @@
+
+add_library(testTarget empty.cpp)
+target_include_directories(testTarget INTERFACE "${CMAKE_INSTALL_PREFIX}/dir")
+
+install(TARGETS testTarget EXPORT testTargets
+  DESTINATION lib
+)
+
+install(EXPORT testTargets DESTINATION lib/cmake)
diff --git a/Tests/RunCMake/include_directories/RunCMakeTest.cmake b/Tests/RunCMake/include_directories/RunCMakeTest.cmake
index 434beb9b5..c5b29d019 100644
--- a/Tests/RunCMake/include_directories/RunCMakeTest.cmake
+++ b/Tests/RunCMake/include_directories/RunCMakeTest.cmake
@@ -13,6 +13,9 @@ run_cmake(install_config)
 run_cmake(incomplete-genex)
 run_cmake(export-NOWARN)
 
+set(RunCMake_TEST_OPTIONS "-DCMAKE_INSTALL_PREFIX=${RunCMake_BINARY_DIR}/DirInInstallPrefix/prefix")
+run_cmake(DirInInstallPrefix)
+
 configure_file(
   "${RunCMake_SOURCE_DIR}/CMakeLists.txt"
   "${RunCMake_BINARY_DIR}/copy/CMakeLists.txt"
diff --git a/Tests/RunCMake/include_directories/SrcInInstallPrefix-CMP0052-WARN-stderr.txt b/Tests/RunCMake/include_directories/SrcInInstallPrefix-CMP0052-WARN-stderr.txt
index 78710c06e..0b13fd899 100644
--- a/Tests/RunCMake/include_directories/SrcInInstallPrefix-CMP0052-WARN-stderr.txt
+++ b/Tests/RunCMake/include_directories/SrcInInstallPrefix-CMP0052-WARN-stderr.txt
@@ -12,4 +12,9 @@ CMake Warning \(dev\) in CMakeLists.txt:
   of the install directory:
 
       ".*Tests/RunCMake/include_directories/prefix"
+
+  however it is also a subdirectory of the source tree:
+
+      ".*Tests/RunCMake/include_directories/prefix/src"
+
 This warning is for project developers.  Use -Wno-dev to suppress it.