diff --git a/config/src/main/java/com/typesafe/config/impl/Parser.java b/config/src/main/java/com/typesafe/config/impl/Parser.java
index 94c6189a..83da109a 100644
--- a/config/src/main/java/com/typesafe/config/impl/Parser.java
+++ b/config/src/main/java/com/typesafe/config/impl/Parser.java
@@ -683,7 +683,9 @@ final class Parser {
             }
 
             if (!pathStack.isEmpty()) {
-                Path prefix = new Path(pathStack);
+                // The stack is in reverse order (most recent first on the
+                // iterator), so build the path from the reversed iterator.
+                Path prefix = new Path(pathStack.descendingIterator());
                 obj = obj.relativized(prefix);
             }
 
diff --git a/config/src/main/java/com/typesafe/config/impl/Path.java b/config/src/main/java/com/typesafe/config/impl/Path.java
index dec48582..c3b8f39e 100644
--- a/config/src/main/java/com/typesafe/config/impl/Path.java
+++ b/config/src/main/java/com/typesafe/config/impl/Path.java
@@ -35,10 +35,14 @@ final class Path {
 
     // append all the paths in the list together into one path
     Path(List<Path> pathsToConcat) {
-        if (pathsToConcat.isEmpty())
+        this(pathsToConcat.iterator());
+    }
+
+    // append all the paths in the iterator together into one path
+    Path(Iterator<Path> i) {
+        if (!i.hasNext())
             throw new ConfigException.BugOrBroken("empty path");
 
-        Iterator<Path> i = pathsToConcat.iterator();
         Path firstPath = i.next();
         this.first = firstPath.first;
 
diff --git a/config/src/test/resources/test10.conf b/config/src/test/resources/test10.conf
index 4d0bb955..6d0a3927 100644
--- a/config/src/test/resources/test10.conf
+++ b/config/src/test/resources/test10.conf
@@ -3,3 +3,9 @@
 foo {
   include "test09.conf"
 }
+
+bar {
+  nested {
+    include "test09.conf"
+  }
+}
diff --git a/config/src/test/scala/com/typesafe/config/impl/ConfigTest.scala b/config/src/test/scala/com/typesafe/config/impl/ConfigTest.scala
index 8c58a510..d26cb997 100644
--- a/config/src/test/scala/com/typesafe/config/impl/ConfigTest.scala
+++ b/config/src/test/scala/com/typesafe/config/impl/ConfigTest.scala
@@ -1029,6 +1029,10 @@ class ConfigTest extends TestUtils {
         assertEquals(3, resolved.getInt("foo.a.c"))
         assertEquals(5, resolved.getInt("foo.b"))
         assertEquals(10, resolved.getInt("foo.a.q"))
+
+        assertEquals(3, resolved.getInt("bar.nested.a.c"))
+        assertEquals(5, resolved.getInt("bar.nested.b"))
+        assertEquals(10, resolved.getInt("bar.nested.a.q"))
     }
 
     @Test