diff --git a/src/merlin.ml b/src/merlin.ml
index fb7c5ead..f3d52427 100644
--- a/src/merlin.ml
+++ b/src/merlin.ml
@@ -127,19 +127,19 @@ let dot_merlin sctx ~dir ~scope ({ requires; flags; _ } as t) =
       flags
       >>^ (fun flags ->
         let (src_dirs, obj_dirs) =
-          Lib.Set.fold requires ~init:(Path.Set.empty, Path.Set.empty)
-            ~f:(fun (lib : Lib.t) (src_dirs, build_dirs) ->
-              ( Path.Set.add src_dirs (Lib.src_dir lib)
-              , Path.Set.add build_dirs (
-                  Lib.obj_dir lib
-                  |> Path.drop_optional_build_context)))
+          Lib.Set.fold requires ~init:(t.source_dirs, t.objs_dirs)
+            ~f:(fun (lib : Lib.t) (src_dirs, obj_dirs) ->
+              ( Path.Set.add src_dirs (
+                  Lib.src_dir lib
+                  |> Path.drop_optional_build_context)
+              , Path.Set.add obj_dirs (Lib.obj_dir lib)))
         in
         Dot_file.to_string
           ~remaindir
           ~ppx:(ppx_flags sctx ~dir ~scope ~src_dir:remaindir t)
           ~flags
-          ~src_dirs:(Path.Set.union src_dirs t.source_dirs)
-          ~obj_dirs:(Path.Set.union obj_dirs t.objs_dirs))
+          ~src_dirs
+          ~obj_dirs)
       >>>
       Build.write_file_dyn merlin_file)
 
diff --git a/test/blackbox-tests/test-cases/merlin-tests/run.t b/test/blackbox-tests/test-cases/merlin-tests/run.t
index dce196b8..29297ed2 100644
--- a/test/blackbox-tests/test-cases/merlin-tests/run.t
+++ b/test/blackbox-tests/test-cases/merlin-tests/run.t
@@ -9,12 +9,12 @@
   B $LIB_PREFIX/lib/findlib
   B $LIB_PREFIX/lib/ocaml
   B ../_build/default/exe/.x.eobjs
-  B ../lib/.foo.objs
+  B ../_build/default/lib/.foo.objs
   S $LIB_PREFIX/lib/bytes
   S $LIB_PREFIX/lib/findlib
   S $LIB_PREFIX/lib/ocaml
-  S ../_build/default/lib
   S .
+  S ../lib
   FLG -w -40
   # Processing lib/.merlin
   B $LIB_PREFIX/lib/bytes