diff --git a/examples/local/BUILD.bazel b/examples/local/BUILD.bazel
new file mode 100644
index 0000000000..c7551687f5
--- /dev/null
+++ b/examples/local/BUILD.bazel
@@ -0,0 +1,30 @@
+# NOTE: the example uses //:defs.bzl because it lives in the same WORKSPACE
+# as the rule declarations.
+# Users should use @build_bazel_rules_nodejs//:defs.bzl
+load("//:defs.bzl", "nodejs_binary")
+
+filegroup(
+    name = "node_modules",
+    srcs = glob([
+        "node_modules/**/*",
+    ]),
+)
+
+nodejs_binary(
+    name = "local",
+    data = [
+        "local.js",
+    ],
+    entry_point = "local.js",
+    node_modules = ":node_modules",
+)
+
+load(":local.bzl", "run_local")
+run_local(
+    name = "local_output",
+)
+
+run_local(
+    name = "local_output2",
+    hello = "bazel",
+)
diff --git a/examples/local/local.bzl b/examples/local/local.bzl
new file mode 100644
index 0000000000..3413aa72c9
--- /dev/null
+++ b/examples/local/local.bzl
@@ -0,0 +1,37 @@
+# Copyright 2017 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.
+
+def _local(ctx):
+  args = ["--hello", ctx.attr.hello]
+  args += ["--output", ctx.outputs.text.path]
+  ctx.action(
+      executable = ctx.executable.binary,
+      outputs = [ctx.outputs.text],
+      arguments = args,
+  )
+  return struct()
+
+run_local = rule(
+    implementation = _local,
+    attrs = {
+        "hello": attr.string(default = "world"),
+        "binary": attr.label(
+            default = Label("//examples/local"),
+            executable = True,
+            cfg = "host"),
+    },
+    outputs = {
+        "text": "%{name}.txt"
+    },
+)
diff --git a/examples/local/local.js b/examples/local/local.js
new file mode 100644
index 0000000000..aa45351472
--- /dev/null
+++ b/examples/local/local.js
@@ -0,0 +1,5 @@
+const fs = require('fs');
+const minimist = require('minimist');
+
+const args = minimist(process.argv.slice(2));
+fs.writeFileSync(args.output, `Hello, ${args.hello}!`);
diff --git a/examples/local/package.json b/examples/local/package.json
new file mode 100644
index 0000000000..3df0edb38b
--- /dev/null
+++ b/examples/local/package.json
@@ -0,0 +1,5 @@
+{
+  "devDependencies": {
+    "minimist": "1.2.0"
+  }
+}
diff --git a/examples/local/test.sh b/examples/local/test.sh
new file mode 100644
index 0000000000..42b7eed945
--- /dev/null
+++ b/examples/local/test.sh
@@ -0,0 +1,20 @@
+#!/bin/bash
+set -e
+
+readonly EXPECTED="${TEST_TMPDIR}/EXPECTED.txt"
+(cat <<'EOF'
+Hello, Node.js!
+EOF
+) > $EXPECTED
+
+readonly EXPECTED="${TEST_TMPDIR}/ACTUAL.txt"
+${TEST_SCRDIR}/build_bazel_rules_nodejs/examples/local/local.js
+
+readonly ACTUAL="${TEST_SRCDIR}/build_bazel_rules_nodejs/examples/rollup/bundle.js"
+diff $ACTUAL $EXPECTED || (
+  echo "Expected"
+  cat $EXPECTED
+  echo "But was"
+  cat $ACTUAL
+  exit 1
+)
diff --git a/examples/local/yarn.lock b/examples/local/yarn.lock
new file mode 100644
index 0000000000..505103783b
--- /dev/null
+++ b/examples/local/yarn.lock
@@ -0,0 +1,7 @@
+# THIS IS AN AUTOGENERATED FILE. DO NOT EDIT THIS FILE DIRECTLY.
+# yarn lockfile v1
+
+
+minimist@1.2.0:
+  version "1.2.0"
+  resolved "https://registry.yarnpkg.com/minimist/-/minimist-1.2.0.tgz#a35008b20f41383eec1fb914f4cd5df79a264284"
diff --git a/internal/node.bzl b/internal/node.bzl
index d10f667045..a91d9bb3b9 100644
--- a/internal/node.bzl
+++ b/internal/node.bzl
@@ -54,6 +54,7 @@ def _write_loader_script(ctx):
           "TEMPLATED_entry_point": ctx.attr.entry_point,
           "TEMPLATED_label_package": ctx.attr.node_modules.label.package,
           "TEMPLATED_workspace_name": ctx.workspace_name,
+          "TEMPLATED_build_file_path": ctx.build_file_path,
       },
       executable=True,
   )
diff --git a/internal/node_loader.js b/internal/node_loader.js
index 246a0890bd..a7e4f224a8 100644
--- a/internal/node_loader.js
+++ b/internal/node_loader.js
@@ -102,6 +102,10 @@ module.constructor._resolveFilename =
   var resolveLocations = [
     request,
     resolveRunfiles(request),
+    resolveRunfiles(
+      'TEMPLATED_workspace_name',
+      path.dirname('TEMPLATED_build_file_path'),
+      request),
     resolveRunfiles(
       'TEMPLATED_workspace_name', 'TEMPLATED_label_package',
       'node_modules', request),