diff --git a/lib/config/config-file.js b/lib/config/config-file.js
index e68591874c0b..4e25887fd47a 100644
--- a/lib/config/config-file.js
+++ b/lib/config/config-file.js
@@ -495,7 +495,6 @@ function resolve(filePath, relativeTo) {
 function load(filePath, applyEnvironments, relativeTo) {
     var resolvedPath = resolve(filePath, relativeTo),
         dirname = path.dirname(resolvedPath.filePath),
-        basedir = getBaseDir(dirname),
         lookupPath = getLookupPath(dirname),
         config = loadConfigFile(resolvedPath);
 
@@ -514,7 +513,7 @@ function load(filePath, applyEnvironments, relativeTo) {
         // include full path of parser if present
         if (config.parser) {
             if (isFilePath(config.parser)) {
-                config.parser = path.resolve(basedir || "", config.parser);
+                config.parser = path.resolve(dirname || "", config.parser);
             } else {
                 config.parser = resolver.resolve(config.parser, lookupPath);
             }
@@ -528,7 +527,7 @@ function load(filePath, applyEnvironments, relativeTo) {
          * a "parent". Load the referenced file and merge the configuration recursively.
          */
         if (config.extends) {
-            config = applyExtends(config, filePath, basedir);
+            config = applyExtends(config, filePath, dirname);
         }
 
         if (config.env && applyEnvironments) {
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 000000000000..ad711c30b2ce
--- /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 bfb80f562c86..2cb050b6876f 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() {