diff --git a/packages/typescript/src/internal/ts_project.bzl b/packages/typescript/src/internal/ts_project.bzl
index 228f57d9bb..caa791fb5f 100644
--- a/packages/typescript/src/internal/ts_project.bzl
+++ b/packages/typescript/src/internal/ts_project.bzl
@@ -47,6 +47,9 @@ def _ts_project_impl(ctx):
         ctx.file.tsconfig.short_path,
         "--outDir",
         "/".join([ctx.bin_dir.path, ctx.label.package]),
+        # Make sure TypeScript writes outputs to same directory structure as inputs
+        "--rootDir",
+        ctx.label.package if ctx.label.package else ".",
     ])
     if len(ctx.outputs.typings_outs) > 0:
         arguments.add_all([
diff --git a/packages/typescript/test/ts_project/rootdir/BUILD.bazel b/packages/typescript/test/ts_project/rootdir/BUILD.bazel
new file mode 100644
index 0000000000..6c12018c32
--- /dev/null
+++ b/packages/typescript/test/ts_project/rootdir/BUILD.bazel
@@ -0,0 +1,4 @@
+load("@npm_bazel_typescript//:index.bzl", "ts_project")
+
+# Ensure that subdir/a.ts produces outDir/subdir/a.js
+ts_project()
diff --git a/packages/typescript/test/ts_project/rootdir/subdir/a.ts b/packages/typescript/test/ts_project/rootdir/subdir/a.ts
new file mode 100644
index 0000000000..a668b7e336
--- /dev/null
+++ b/packages/typescript/test/ts_project/rootdir/subdir/a.ts
@@ -0,0 +1 @@
+export const a: string = 'hello';
diff --git a/packages/typescript/test/ts_project/rootdir/tsconfig.json b/packages/typescript/test/ts_project/rootdir/tsconfig.json
new file mode 100644
index 0000000000..0967ef424b
--- /dev/null
+++ b/packages/typescript/test/ts_project/rootdir/tsconfig.json
@@ -0,0 +1 @@
+{}