diff --git a/builtin/fsmonitor--daemon.c b/builtin/fsmonitor--daemon.c
index dce8a3b248291d..e1e6b96d09e9d8 100644
--- a/builtin/fsmonitor--daemon.c
+++ b/builtin/fsmonitor--daemon.c
@@ -1314,6 +1314,7 @@ static int fsmonitor_run_daemon(void)
 		strbuf_reset(&state.path_gitdir_watch);
 		strbuf_addstr(&state.path_gitdir_watch,
 			      absolute_path(repo_get_git_dir(the_repository)));
+		strbuf_strip_suffix(&state.path_gitdir_watch, "/.");
 		state.nr_paths_watching = 2;
 	}
 
diff --git a/t/t7527-builtin-fsmonitor.sh b/t/t7527-builtin-fsmonitor.sh
index 730f3c7f81090e..9b15baa02d3985 100755
--- a/t/t7527-builtin-fsmonitor.sh
+++ b/t/t7527-builtin-fsmonitor.sh
@@ -907,6 +907,57 @@ test_expect_success "submodule absorbgitdirs implicitly starts daemon" '
 	test_subcommand git fsmonitor--daemon start <super-sub.trace
 '
 
+start_git_in_background () {
+	git "$@" &
+	git_pid=$!
+	git_pgid=$(ps -o pgid= -p $git_pid)
+	nr_tries_left=10
+	while true
+	do
+		if test $nr_tries_left -eq 0
+		then
+			kill -- -$git_pgid
+			exit 1
+		fi
+		sleep 1
+		nr_tries_left=$(($nr_tries_left - 1))
+	done >/dev/null 2>&1 &
+	watchdog_pid=$!
+	wait $git_pid
+}
+
+stop_git () {
+	while kill -0 -- -$git_pgid
+	do
+		kill -- -$git_pgid
+		sleep 1
+	done
+}
+
+stop_watchdog () {
+	while kill -0 $watchdog_pid
+	do
+		kill $watchdog_pid
+		sleep 1
+	done
+}
+
+test_expect_success !MINGW "submodule implicitly starts daemon by pull" '
+	test_atexit "stop_watchdog" &&
+	test_when_finished "stop_git; rm -rf cloned super sub" &&
+
+	create_super super &&
+	create_sub sub &&
+
+	git -C super submodule add ../sub ./dir_1/dir_2/sub &&
+	git -C super commit -m "add sub" &&
+	git clone --recurse-submodules super cloned &&
+
+	git -C cloned/dir_1/dir_2/sub config core.fsmonitor true &&
+	set -m &&
+	start_git_in_background -C cloned pull --recurse-submodules
+'
+
 # On a case-insensitive file system, confirm that the daemon
 # notices when the .git directory is moved/renamed/deleted
 # regardless of how it is spelled in the FS event.