diff --git a/lib/config/config-file.js b/lib/config/config-file.js
index e68591874c0..019fa563b02 100644
--- a/lib/config/config-file.js
+++ b/lib/config/config-file.js
@@ -315,6 +315,10 @@ function getBaseDir(configFilePath) {
     // calculates the path of the project including ESLint as dependency
     var projectPath = path.resolve(__dirname, "../../../");
 
+    if (path.basename(projectPath) === "node_modules") {
+        projectPath = path.dirname(projectPath);
+    }
+
     if (configFilePath && pathIsInside(configFilePath, projectPath)) {
 
         // be careful of https://github.com/substack/node-resolve/issues/78
diff --git a/tests/fixtures/config-file/extends-chain-2/relative.eslintrc.json b/tests/fixtures/config-file/extends-chain-2/relative.eslintrc.json
new file mode 100644
index 00000000000..ad711c30b2c
--- /dev/null
+++ b/tests/fixtures/config-file/extends-chain-2/relative.eslintrc.json
@@ -0,0 +1,3 @@
+{
+    "extends": "./node_modules/eslint-config-a/index.js"
+}
diff --git a/tests/lib/config/config-file.js b/tests/lib/config/config-file.js
index bfb80f562c8..2cb050b6876 100644
--- a/tests/lib/config/config-file.js
+++ b/tests/lib/config/config-file.js
@@ -657,6 +657,21 @@ describe("ConfigFile", function() {
             });
         });
 
+        it("should load information from `extends` chain with relative path.", function() {
+            var config = ConfigFile.load(getFixturePath("extends-chain-2/relative.eslintrc.json"));
+
+            assert.deepEqual(config, {
+                env: {},
+                extends: "./node_modules/eslint-config-a/index.js",
+                globals: {},
+                parserOptions: {},
+                rules: {
+                    a: 2,       // from node_modules/eslint-config-a/index.js
+                    relative: 2 // from node_modules/eslint-config-a/relative.js
+                }
+            });
+        });
+
         describe("Plugins", function() {
 
             it("should load information from a YML file and load plugins", function() {