diff --git a/src/index.js b/src/index.js
index 17435c4b..71267aa2 100644
--- a/src/index.js
+++ b/src/index.js
@@ -9,6 +9,7 @@ import {
   getSassOptions,
   getWebpackImporter,
   getRenderFunctionFromSassImplementation,
+  absolutifySourceMapSource,
 } from './utils';
 import SassError from './SassError';
 
@@ -27,8 +28,15 @@ function loader(content) {
   });
 
   const implementation = getSassImplementation(options.implementation);
-  const sassOptions = getSassOptions(this, options, content, implementation);
-
+  const useSourceMap =
+    typeof options.sourceMap === 'boolean' ? options.sourceMap : this.sourceMap;
+  const sassOptions = getSassOptions(
+    this,
+    options,
+    content,
+    implementation,
+    useSourceMap
+  );
   const shouldUseWebpackImporter =
     typeof options.webpackImporter === 'boolean'
       ? options.webpackImporter
@@ -58,7 +66,8 @@ function loader(content) {
       return;
     }
 
-    if (result.map) {
+    // Modify source paths only for webpack, otherwise we do nothing
+    if (result.map && useSourceMap) {
       // eslint-disable-next-line no-param-reassign
       result.map = JSON.parse(result.map);
 
@@ -67,13 +76,16 @@ function loader(content) {
       // eslint-disable-next-line no-param-reassign
       delete result.map.file;
 
+      // eslint-disable-next-line no-param-reassign
+      result.sourceRoot = '';
+
       // node-sass returns POSIX paths, that's why we need to transform them back to native paths.
       // This fixes an error on windows where the source-map module cannot resolve the source maps.
       // @see https://github.com/webpack-contrib/sass-loader/issues/366#issuecomment-279460722
       // eslint-disable-next-line no-param-reassign
-      result.map.sourceRoot = path.normalize(result.map.sourceRoot);
-      // eslint-disable-next-line no-param-reassign
-      result.map.sources = result.map.sources.map(path.normalize);
+      result.map.sources = result.map.sources.map((source) =>
+        absolutifySourceMapSource(this.rootContext, source)
+      );
     }
 
     result.stats.includedFiles.forEach((includedFile) => {
diff --git a/src/utils.js b/src/utils.js
index fa3c0112..113d3174 100644
--- a/src/utils.js
+++ b/src/utils.js
@@ -93,9 +93,16 @@ function proxyCustomImporters(importers, loaderContext) {
  * @param {object} loaderOptions
  * @param {string} content
  * @param {object} implementation
+ * @param {boolean} useSourceMap
  * @returns {Object}
  */
-function getSassOptions(loaderContext, loaderOptions, content, implementation) {
+function getSassOptions(
+  loaderContext,
+  loaderOptions,
+  content,
+  implementation,
+  useSourceMap
+) {
   const options = klona(
     loaderOptions.sassOptions
       ? typeof loaderOptions.sassOptions === 'function'
@@ -143,11 +150,6 @@ function getSassOptions(loaderContext, loaderOptions, content, implementation) {
     options.outputStyle = 'compressed';
   }
 
-  const useSourceMap =
-    typeof loaderOptions.sourceMap === 'boolean'
-      ? loaderOptions.sourceMap
-      : loaderContext.sourceMap;
-
   if (useSourceMap) {
     // Deliberately overriding the sourceMap option here.
     // node-sass won't produce source maps if the data option is used and options.sourceMap is not a string.
@@ -155,11 +157,12 @@ function getSassOptions(loaderContext, loaderOptions, content, implementation) {
     // But since we're using the data option, the source map will not actually be written, but
     // all paths in sourceMap.sources will be relative to that path.
     // Pretty complicated... :(
-    options.sourceMap = path.join(process.cwd(), '/sass.css.map');
-    options.sourceMapRoot = process.cwd();
+    options.sourceMap = true;
+    options.outFile = path.join(loaderContext.rootContext, 'style.css.map');
+    // options.sourceMapRoot = process.cwd();
     options.sourceMapContents = true;
     options.omitSourceMapUrl = true;
-    options.sourceMapEmbed = false;
+    // options.sourceMapEmbed = false;
   }
 
   const { resourcePath } = loaderContext;
@@ -483,10 +486,36 @@ function getRenderFunctionFromSassImplementation(implementation) {
   return nodeSassJobQueue.push.bind(nodeSassJobQueue);
 }
 
+const ABSOLUTE_SCHEME = /^[A-Za-z0-9+\-.]+:/;
+
+function getURLType(source) {
+  if (source[0] === '/') {
+    if (source[1] === '/') {
+      return 'scheme-relative';
+    }
+
+    return 'path-absolute';
+  }
+
+  return ABSOLUTE_SCHEME.test(source) ? 'absolute' : 'path-relative';
+}
+
+function absolutifySourceMapSource(sourceRoot, source) {
+  const sourceType = getURLType(source);
+
+  // Do no touch `scheme-relative`, `path-absolute` and `absolute` types
+  if (sourceType === 'path-relative') {
+    return path.resolve(sourceRoot, path.normalize(source));
+  }
+
+  return source;
+}
+
 export {
   getSassImplementation,
   getSassOptions,
   getWebpackResolver,
   getWebpackImporter,
   getRenderFunctionFromSassImplementation,
+  absolutifySourceMapSource,
 };
diff --git a/test/sourceMap-options.test.js b/test/sourceMap-options.test.js
index f2a68b75..21925d48 100644
--- a/test/sourceMap-options.test.js
+++ b/test/sourceMap-options.test.js
@@ -42,7 +42,9 @@ describe('sourceMap option', () => {
 
         sourceMap.sourceRoot = '';
         sourceMap.sources = sourceMap.sources.map((source) =>
-          source.replace(/\\/g, '/')
+          path
+            .relative(path.resolve(__dirname, '..'), source)
+            .replace(/\\/g, '/')
         );
 
         expect(css).toMatchSnapshot('css');
@@ -124,7 +126,9 @@ describe('sourceMap option', () => {
 
         sourceMap.sourceRoot = '';
         sourceMap.sources = sourceMap.sources.map((source) =>
-          source.replace(/\\/g, '/')
+          path
+            .relative(path.resolve(__dirname, '..'), source)
+            .replace(/\\/g, '/')
         );
 
         expect(css).toMatchSnapshot('css');
@@ -157,7 +161,9 @@ describe('sourceMap option', () => {
 
         sourceMap.sourceRoot = '';
         sourceMap.sources = sourceMap.sources.map((source) =>
-          source.replace(/\\/g, '/')
+          path
+            .relative(path.resolve(__dirname, '..'), source)
+            .replace(/\\/g, '/')
         );
 
         expect(css).toMatchSnapshot('css');