diff --git a/merge-ort.c b/merge-ort.c
index 47b3d1730ece36..a0e29417157537 100644
--- a/merge-ort.c
+++ b/merge-ort.c
@@ -316,9 +316,14 @@ struct merge_options_internal {
 	 *     (e.g. "drivers/firmware/raspberrypi.c").
 	 *   * store all relevant paths in the repo, both directories and
 	 *     files (e.g. drivers, drivers/firmware would also be included)
-	 *   * these keys serve to intern all the path strings, which allows
-	 *     us to do pointer comparison on directory names instead of
-	 *     strcmp; we just have to be careful to use the interned strings.
+	 *   * these keys serve to intern *all* path strings, which allows us
+	 *     to do pointer comparisons on file & directory names instead of
+	 *     using strcmp; however, for this pointer-comparison optimization
+	 *     to work, any code path that independently computes a path needs
+	 *     to check for it existing in this strmap, and if so, point to
+	 *     the path in this strmap instead of their computed copy.  See
+	 *     the "reuse known pointer" comment in
+	 *     apply_directory_rename_modifications() for an example.
 	 *
 	 * The values of paths:
 	 *   * either a pointer to a merged_info, or a conflict_info struct
@@ -2163,7 +2168,7 @@ static int handle_content_merge(struct merge_options *opt,
 		/*
 		 * FIXME: If opt->priv->call_depth && !clean, then we really
 		 * should not make result->mode match either a->mode or
-		 * b->mode; that causes t6036 "check conflicting mode for
+		 * b->mode; that causes t6416 "check conflicting mode for
 		 * regular file" to fail.  It would be best to use some other
 		 * mode, but we'll confuse all kinds of stuff if we use one
 		 * where S_ISREG(result->mode) isn't true, and if we use
@@ -2313,14 +2318,20 @@ static char *apply_dir_rename(struct strmap_entry *rename_info,
 	return strbuf_detach(&new_path, NULL);
 }
 
-static int path_in_way(struct strmap *paths, const char *path, unsigned side_mask)
+static int path_in_way(struct strmap *paths,
+		       const char *path,
+		       unsigned side_mask,
+		       struct diff_filepair *p)
 {
 	struct merged_info *mi = strmap_get(paths, path);
 	struct conflict_info *ci;
 	if (!mi)
 		return 0;
 	INITIALIZE_CI(ci, mi);
-	return mi->clean || (side_mask & (ci->filemask | ci->dirmask));
+	return mi->clean || (side_mask & (ci->filemask | ci->dirmask))
+	  /* See testcases 12[npq] of t6423 for this next condition */
+			 || ((ci->filemask & 0x01) &&
+			     strcmp(p->one->path, path));
 }
 
 /*
@@ -2332,6 +2343,7 @@ static int path_in_way(struct strmap *paths, const char *path, unsigned side_mas
 static char *handle_path_level_conflicts(struct merge_options *opt,
 					 const char *path,
 					 unsigned side_index,
+					 struct diff_filepair *p,
 					 struct strmap_entry *rename_info,
 					 struct strmap *collisions)
 {
@@ -2366,7 +2378,7 @@ static char *handle_path_level_conflicts(struct merge_options *opt,
 	 */
 	if (c_info->reported_already) {
 		clean = 0;
-	} else if (path_in_way(&opt->priv->paths, new_path, 1 << side_index)) {
+	} else if (path_in_way(&opt->priv->paths, new_path, 1 << side_index, p)) {
 		c_info->reported_already = 1;
 		strbuf_add_separated_string_list(&collision_paths, ", ",
 						 &c_info->source_files);
@@ -2520,7 +2532,7 @@ static void compute_collisions(struct strmap *collisions,
 	 * happening, and fall back to no-directory-rename detection
 	 * behavior for those paths.
 	 *
-	 * See testcases 9e and all of section 5 from t6043 for examples.
+	 * See testcases 9e and all of section 5 from t6423 for examples.
 	 */
 	for (i = 0; i < pairs->nr; ++i) {
 		struct strmap_entry *rename_info;
@@ -2573,6 +2585,7 @@ static void free_collisions(struct strmap *collisions)
 static char *check_for_directory_rename(struct merge_options *opt,
 					const char *path,
 					unsigned side_index,
+					struct diff_filepair *p,
 					struct strmap *dir_renames,
 					struct strmap *dir_rename_exclusions,
 					struct strmap *collisions,
@@ -2580,7 +2593,6 @@ static char *check_for_directory_rename(struct merge_options *opt,
 {
 	char *new_path;
 	struct strmap_entry *rename_info;
-	struct strmap_entry *otherinfo;
 	const char *new_dir;
 	int other_side = 3 - side_index;
 
@@ -2615,14 +2627,13 @@ static char *check_for_directory_rename(struct merge_options *opt,
 	 * to not let Side1 do the rename to dumbdir, since we know that is
 	 * the source of one of our directory renames.
 	 *
-	 * That's why otherinfo and dir_rename_exclusions is here.
+	 * That's why dir_rename_exclusions is here.
 	 *
 	 * As it turns out, this also prevents N-way transient rename
-	 * confusion; See testcases 9c and 9d of t6043.
+	 * confusion; See testcases 9c and 9d of t6423.
 	 */
 	new_dir = rename_info->value; /* old_dir = rename_info->key; */
-	otherinfo = strmap_get_entry(dir_rename_exclusions, new_dir);
-	if (otherinfo) {
+	if (strmap_contains(dir_rename_exclusions, new_dir)) {
 		path_msg(opt, INFO_DIR_RENAME_SKIPPED_DUE_TO_RERENAME, 1,
 			 rename_info->key, path, new_dir, NULL,
 			 _("WARNING: Avoiding applying %s -> %s rename "
@@ -2631,7 +2642,7 @@ static char *check_for_directory_rename(struct merge_options *opt,
 		return NULL;
 	}
 
-	new_path = handle_path_level_conflicts(opt, path, side_index,
+	new_path = handle_path_level_conflicts(opt, path, side_index, p,
 					       rename_info,
 					       &collisions[side_index]);
 	*clean_merge &= (new_path != NULL);
@@ -2875,6 +2886,20 @@ static int process_renames(struct merge_options *opt,
 			newinfo = new_ent->value;
 		}
 
+		/*
+		 * Directory renames can result in rename-to-self; the code
+		 * below assumes we have A->B with different A & B, and tries
+		 * to move all entries to path B.  If A & B are the same path,
+		 * the logic can get confused, so skip further processing when
+		 * A & B are already the same path.
+		 *
+		 * As a reminder, we can avoid strcmp here because all paths
+		 * are interned in opt->priv->paths; see the comment above
+		 * "paths" in struct merge_options_internal.
+		 */
+		if (oldpath == newpath)
+			continue;
+
 		/*
 		 * If pair->one->path isn't in opt->priv->paths, that means
 		 * that either directory rename detection removed that
@@ -3419,7 +3444,7 @@ static int collect_renames(struct merge_options *opt,
 		}
 
 		new_path = check_for_directory_rename(opt, p->two->path,
-						      side_index,
+						      side_index, p,
 						      dir_renames_for_side,
 						      rename_exclusions,
 						      collisions,
diff --git a/t/t6423-merge-rename-directories.sh b/t/t6423-merge-rename-directories.sh
index f48ed6d03534ee..533ac85dc83409 100755
--- a/t/t6423-merge-rename-directories.sh
+++ b/t/t6423-merge-rename-directories.sh
@@ -4731,7 +4731,7 @@ test_setup_12i () {
 
 		mkdir -p source/subdir &&
 		echo foo >source/subdir/foo &&
-		echo bar >source/bar &&
+		printf "%d\n" 1 2 3 4 5 6 7 >source/bar &&
 		echo baz >source/baz &&
 		git add source &&
 		git commit -m orig &&
@@ -4747,6 +4747,7 @@ test_setup_12i () {
 		git switch B &&
 		git mv source/bar source/subdir/bar &&
 		echo more baz >>source/baz &&
+		git add source/baz &&
 		git commit -m B
 	)
 }
@@ -4758,6 +4759,88 @@ test_expect_success '12i: Directory rename causes rename-to-self' '
 
 		git checkout A^0 &&
 
+		# NOTE: A potentially better resolution would be for
+		#     source/bar -> source/subdir/bar
+		# to use the directory rename to become
+		#     source/bar -> source/bar
+		# (a rename to self), and thus we end up with bar with
+		# a path conflict (given merge.directoryRenames=conflict).
+		# However, since the relevant renames optimization
+		# prevents us from noticing
+		#     source/bar -> source/subdir/bar
+		# as a rename and looking at it just as
+		#     delete source/bar
+		#     add source/subdir/bar
+		# the directory rename of source/subdir/bar -> source/bar does
+		# not look like a rename-to-self situation but a
+		# rename-on-top-of-other-file situation.  We do not want
+		# stage 1 entries from an unrelated file, so we expect an
+		# error about there being a file in the way.
+
+		test_must_fail git -c merge.directoryRenames=conflict merge -s recursive B^0 >out &&
+
+		grep "CONFLICT (implicit dir rename).*source/bar in the way" out &&
+		test_path_is_missing source/bar &&
+		test_path_is_file source/subdir/bar &&
+		test_path_is_file source/baz &&
+
+		git ls-files >actual &&
+		uniq <actual >tracked &&
+		test_line_count = 3 tracked &&
+
+		git status --porcelain -uno >actual &&
+		cat >expect <<-\EOF &&
+		M  source/baz
+		R  source/bar -> source/subdir/bar
+		EOF
+		test_cmp expect actual
+	)
+'
+
+# Testcase 12i2, Identical to 12i except that source/subdir/bar modified on unrenamed side
+#   Commit O: source/{subdir/foo, bar, baz_1}
+#   Commit A: source/{foo, bar_2, baz_1}
+#   Commit B: source/{subdir/{foo, bar}, baz_2}
+#   Expected: source/{foo, bar, baz_2}, with conflicts on
+#                source/bar vs. source/subdir/bar
+
+test_setup_12i2 () {
+	git init 12i2 &&
+	(
+		cd 12i2 &&
+
+		mkdir -p source/subdir &&
+		echo foo >source/subdir/foo &&
+		printf "%d\n" 1 2 3 4 5 6 7 >source/bar &&
+		echo baz >source/baz &&
+		git add source &&
+		git commit -m orig &&
+
+		git branch O &&
+		git branch A &&
+		git branch B &&
+
+		git switch A &&
+		git mv source/subdir/foo source/foo &&
+		echo 8 >> source/bar &&
+		git add source/bar &&
+		git commit -m A &&
+
+		git switch B &&
+		git mv source/bar source/subdir/bar &&
+		echo more baz >>source/baz &&
+		git add source/baz &&
+		git commit -m B
+	)
+}
+
+test_expect_success '12i2: Directory rename causes rename-to-self' '
+	test_setup_12i2 &&
+	(
+		cd 12i2 &&
+
+		git checkout A^0 &&
+
 		test_must_fail git -c merge.directoryRenames=conflict merge -s recursive B^0 &&
 
 		test_path_is_missing source/subdir &&
@@ -4771,7 +4854,7 @@ test_expect_success '12i: Directory rename causes rename-to-self' '
 		git status --porcelain -uno >actual &&
 		cat >expect <<-\EOF &&
 		UU source/bar
-		 M source/baz
+		M  source/baz
 		EOF
 		test_cmp expect actual
 	)
@@ -4806,6 +4889,7 @@ test_setup_12j () {
 		git switch B &&
 		git mv bar subdir/bar &&
 		echo more baz >>baz &&
+		git add baz &&
 		git commit -m B
 	)
 }
@@ -4817,10 +4901,29 @@ test_expect_success '12j: Directory rename to root causes rename-to-self' '
 
 		git checkout A^0 &&
 
-		test_must_fail git -c merge.directoryRenames=conflict merge -s recursive B^0 &&
-
-		test_path_is_missing subdir &&
-		test_path_is_file bar &&
+		# NOTE: A potentially better resolution would be for
+		#     bar -> subdir/bar
+		# to use the directory rename to become
+		#     bar -> bar
+		# (a rename to self), and thus we end up with bar with
+		# a path conflict (given merge.directoryRenames=conflict).
+		# However, since the relevant renames optimization
+		# prevents us from noticing
+		#     bar -> subdir/bar
+		# as a rename and looking at it just as
+		#     delete bar
+		#     add subdir/bar
+		# the directory rename of subdir/bar -> bar does not look
+		# like a rename-to-self situation but a
+		# rename-on-top-of-other-file situation.  We do not want
+		# stage 1 entries from an unrelated file, so we expect an
+		# error about there being a file in the way.
+
+		test_must_fail git -c merge.directoryRenames=conflict merge -s recursive B^0 >out &&
+		grep "CONFLICT (implicit dir rename).*bar in the way" out &&
+
+		test_path_is_missing bar &&
+		test_path_is_file subdir/bar &&
 		test_path_is_file baz &&
 
 		git ls-files >actual &&
@@ -4829,8 +4932,8 @@ test_expect_success '12j: Directory rename to root causes rename-to-self' '
 
 		git status --porcelain -uno >actual &&
 		cat >expect <<-\EOF &&
-		UU bar
-		 M baz
+		M  baz
+		R  bar -> subdir/bar
 		EOF
 		test_cmp expect actual
 	)
@@ -4865,6 +4968,7 @@ test_setup_12k () {
 		git switch B &&
 		git mv dirA/bar dirB/bar &&
 		echo more baz >>dirA/baz &&
+		git add dirA/baz &&
 		git commit -m B
 	)
 }
@@ -4876,10 +4980,29 @@ test_expect_success '12k: Directory rename with sibling causes rename-to-self' '
 
 		git checkout A^0 &&
 
-		test_must_fail git -c merge.directoryRenames=conflict merge -s recursive B^0 &&
-
-		test_path_is_missing dirB &&
-		test_path_is_file dirA/bar &&
+		# NOTE: A potentially better resolution would be for
+		#     dirA/bar -> dirB/bar
+		# to use the directory rename (dirB/ -> dirA/) to become
+		#     dirA/bar -> dirA/bar
+		# (a rename to self), and thus we end up with bar with
+		# a path conflict (given merge.directoryRenames=conflict).
+		# However, since the relevant renames optimization
+		# prevents us from noticing
+		#     dirA/bar -> dirB/bar
+		# as a rename and looking at it just as
+		#     delete dirA/bar
+		#     add dirB/bar
+		# the directory rename of dirA/bar -> dirB/bar does
+		# not look like a rename-to-self situation but a
+		# rename-on-top-of-other-file situation.  We do not want
+		# stage 1 entries from an unrelated file, so we expect an
+		# error about there being a file in the way.
+
+		test_must_fail git -c merge.directoryRenames=conflict merge -s recursive B^0 >out &&
+		grep "CONFLICT (implicit dir rename).*dirA/bar in the way" out &&
+
+		test_path_is_missing dirA/bar &&
+		test_path_is_file dirB/bar &&
 		test_path_is_file dirA/baz &&
 
 		git ls-files >actual &&
@@ -4888,8 +5011,8 @@ test_expect_success '12k: Directory rename with sibling causes rename-to-self' '
 
 		git status --porcelain -uno >actual &&
 		cat >expect <<-\EOF &&
-		UU dirA/bar
-		 M dirA/baz
+		M  dirA/baz
+		R  dirA/bar -> dirB/bar
 		EOF
 		test_cmp expect actual
 	)
@@ -5056,6 +5179,25 @@ test_expect_success '12m: Change parent of renamed-dir to symlink on other side'
 	)
 '
 
+# Testcase 12n, Directory rename transitively makes rename back to self
+#
+# (Since this is a cherry-pick instead of merge, the labels are a bit weird.
+#  O, the original commit, is A~1 rather than what branch O points to.)
+#
+#   Commit O:  tools/hello
+#              world
+#   Commit A:  tools/hello
+#              tools/world
+#   Commit B:  hello
+#   In words:
+#     A: world -> tools/world
+#     B: tools/ -> /, i.e. rename all of tools to toplevel directory
+#        delete world
+#
+#   Expected:
+#             CONFLICT (file location): tools/world vs. world
+#
+
 test_setup_12n () {
 	git init 12n &&
 	(
@@ -5092,10 +5234,357 @@ test_expect_success '12n: Directory rename transitively makes rename back to sel
 		git checkout -q B^0 &&
 
 		test_must_fail git cherry-pick A^0 >out &&
-		grep "CONFLICT (file location).*should perhaps be moved" out
+		test_grep "CONFLICT (file location).*should perhaps be moved" out &&
+
+		# Should have 1 entry for hello, and 2 for world
+		test_stdout_line_count = 3 git ls-files -s &&
+		test_stdout_line_count = 1 git ls-files -s hello &&
+		test_stdout_line_count = 2 git ls-files -s world
+	)
+'
+
+# Testcase 12n2, Directory rename transitively makes rename back to self
+#
+#   Commit O:  tools/hello
+#              world
+#   Commit A:  tools/hello
+#              tools/world
+#   Commit B:  hello
+#   In words:
+#     A: world -> tools/world
+#     B: tools/ -> /, i.e. rename all of tools to toplevel directory
+#        delete world
+#
+#   Expected:
+#             CONFLICT (file location): tools/world vs. world
+#
+
+test_setup_12n2 () {
+	git init 12n2 &&
+	(
+		cd 12n2 &&
+
+		mkdir tools &&
+		echo hello >tools/hello &&
+		git add tools/hello &&
+		echo world >world &&
+		git add world &&
+		git commit -m "O" &&
+
+		git branch O &&
+		git branch A &&
+		git branch B &&
+
+		git switch A &&
+		git mv world tools/world &&
+		git commit -m "Move world into tools/" &&
+
+		git switch B &&
+		git mv tools/hello hello &&
+		git rm world &&
+		git commit -m "Move hello from tools/ to toplevel"
+	)
+}
+
+test_expect_success '12n2: Directory rename transitively makes rename back to self' '
+	test_setup_12n2 &&
+	(
+		cd 12n2 &&
+
+		git checkout -q B^0 &&
+
+		test_might_fail git -c merge.directoryRenames=true merge A^0 >out &&
+
+		# Should have 1 entry for hello, and either 0 or 2 for world
+		#
+		# NOTE: Since merge.directoryRenames=true, there is no path
+		# conflict for world vs. tools/world; it should end up at
+		# world.  The fact that world was unmodified on side A, means
+		# there was no content conflict; we should just take the
+		# content from side B -- i.e. delete the file.  So merging
+		# could just delete world.
+		#
+		# However, rename-to-self-via-directory-rename is a bit more
+		# challenging.  Relax this test to allow world to be treated
+		# as a modify/delete conflict as well, meaning it will have
+		# two higher order stages, that just so happen to match.
+		#
+		test_stdout_line_count = 1 git ls-files -s hello &&
+		test_stdout_line_count = 2 git ls-files -s world &&
+		test_grep "CONFLICT (modify/delete).*world deleted in HEAD" out
 	)
 '
 
+# Testcase 12o, Directory rename hits other rename source; file still in way on same side
+#   Commit O:  A/file1_1
+#              A/stuff
+#              B/file1_2
+#              B/stuff
+#              C/other
+#   Commit A:  A/file1_1
+#              A/stuff
+#              B/stuff
+#              C/file1_2
+#              C/other
+#   Commit B:  D/file2_1
+#              A/stuff
+#              B/file1_2
+#              B/stuff
+#              A/other
+#   In words:
+#     A: rename B/file1_2 -> C/file1_2
+#     B: rename C/ -> A/
+#        rename A/file1_1 -> D/file2_1
+#   Rationale:
+#       A/stuff is unmodified, it shows up in final output
+#       B/stuff is unmodified, it shows up in final output
+#       C/other touched on one side (rename to A), so A/other shows up in output
+#       A/file1 is renamed to D/file2
+#       B/file1 -> C/file1 and even though C/ -> A/, A/file1 is
+#               "in the way" so we don't do the directory rename
+#   Expected:  A/stuff
+#              B/stuff
+#              A/other
+#              D/file2
+#              C/file1
+#              + CONFLICT (implicit dir rename): A/file1 in way of C/file1
+#
+
+test_setup_12o () {
+	git init 12o &&
+	(
+		cd 12o &&
+
+		mkdir -p A B C &&
+		echo 1 >A/file1 &&
+		echo 2 >B/file1 &&
+		echo other >C/other &&
+		echo Astuff >A/stuff &&
+		echo Bstuff >B/stuff &&
+		git add . &&
+		git commit -m "O" &&
+
+		git branch O &&
+		git branch A &&
+		git branch B &&
+
+		git switch A &&
+		git mv B/file1 C/ &&
+		git add . &&
+		git commit -m "A" &&
+
+		git switch B &&
+		mkdir -p D &&
+		git mv A/file1 D/file2 &&
+		git mv C/other A/other &&
+		git add . &&
+		git commit -m "B"
+	)
+}
+
+test_expect_success '12o: Directory rename hits other rename source; file still in way on same side' '
+	test_setup_12o &&
+	(
+		cd 12o &&
+
+		git checkout -q A^0 &&
+
+		test_must_fail git -c merge.directoryRenames=conflict merge -s recursive B^0 >out &&
+
+		test_stdout_line_count = 5 git ls-files -s &&
+		test_stdout_line_count = 1 git ls-files -s A/other &&
+		test_stdout_line_count = 1 git ls-files -s A/stuff &&
+		test_stdout_line_count = 1 git ls-files -s B/stuff &&
+		test_stdout_line_count = 1 git ls-files -s D/file2 &&
+
+		grep "CONFLICT (implicit dir rename).*Existing file/dir at A/file1 in the way" out &&
+		test_stdout_line_count = 1 git ls-files -s C/file1
+	)
+'
+
+# Testcase 12p, Directory rename hits other rename source; file still in way on other side
+#   Commit O:  A/file1_1
+#              A/stuff
+#              B/file1_2
+#              B/stuff
+#              C/other
+#   Commit A:  D/file2_1
+#              A/stuff
+#              B/stuff
+#              C/file1_2
+#              C/other
+#   Commit B:  A/file1_1
+#              A/stuff
+#              B/file1_2
+#              B/stuff
+#              A/other
+#   Short version:
+#     A: rename A/file1_1 -> D/file2_1
+#        rename B/file1_2 -> C/file1_2
+#     B: Rename C/ -> A/
+#   Rationale:
+#       A/stuff is unmodified, it shows up in final output
+#       B/stuff is unmodified, it shows up in final output
+#       C/other touched on one side (rename to A), so A/other shows up in output
+#       A/file1 is renamed to D/file2
+#       B/file1 -> C/file1 and even though C/ -> A/, A/file1 is
+#               "in the way" so we don't do the directory rename
+#   Expected:  A/stuff
+#              B/stuff
+#              A/other
+#              D/file2
+#              C/file1
+#              + CONFLICT (implicit dir rename): A/file1 in way of C/file1
+#
+
+test_setup_12p () {
+	git init 12p &&
+	(
+		cd 12p &&
+
+		mkdir -p A B C &&
+		echo 1 >A/file1 &&
+		echo 2 >B/file1 &&
+		echo other >C/other &&
+		echo Astuff >A/stuff &&
+		echo Bstuff >B/stuff &&
+		git add . &&
+		git commit -m "O" &&
+
+		git branch O &&
+		git branch A &&
+		git branch B &&
+
+		git switch A &&
+		mkdir -p D &&
+		git mv A/file1 D/file2 &&
+		git mv B/file1 C/ &&
+		git add . &&
+		git commit -m "A" &&
+
+		git switch B &&
+		git mv C/other A/other &&
+		git add . &&
+		git commit -m "B"
+	)
+}
+
+test_expect_success '12p: Directory rename hits other rename source; file still in way on other side' '
+	test_setup_12p &&
+	(
+		cd 12p &&
+
+		git checkout -q A^0 &&
+
+		test_must_fail git -c merge.directoryRenames=conflict merge -s recursive B^0 >out &&
+
+		test_stdout_line_count = 5 git ls-files -s &&
+		test_stdout_line_count = 1 git ls-files -s A/other &&
+		test_stdout_line_count = 1 git ls-files -s A/stuff &&
+		test_stdout_line_count = 1 git ls-files -s B/stuff &&
+		test_stdout_line_count = 1 git ls-files -s D/file2 &&
+
+		grep "CONFLICT (implicit dir rename).*Existing file/dir at A/file1 in the way" out &&
+		test_stdout_line_count = 1 git ls-files -s C/file1
+	)
+'
+
+# Testcase 12q, Directory rename hits other rename source; file removed though
+#   Commit O:  A/file1_1
+#              A/stuff
+#              B/file1_2
+#              B/stuff
+#              C/other
+#   Commit A:  A/stuff
+#              B/stuff
+#              C/file1_2
+#              C/other
+#   Commit B:  D/file2_1
+#              A/stuff
+#              B/file1_2
+#              B/stuff
+#              A/other
+#   In words:
+#     A: delete A/file1_1, rename B/file1_2 -> C/file1_2
+#     B: Rename C/ -> A/, rename A/file1_1 -> D/file2_1
+#   Rationale:
+#       A/stuff is unmodified, it shows up in final output
+#       B/stuff is unmodified, it shows up in final output
+#       C/other touched on one side (rename to A), so A/other shows up in output
+#       A/file1 is rename/delete to D/file2, so two stages for D/file2
+#       B/file1 -> C/file1 and even though C/ -> A/, A/file1 as a source was
+#               "in the way" (ish) so we don't do the directory rename
+#   Expected:  A/stuff
+#              B/stuff
+#              A/other
+#              D/file2 (two stages)
+#              C/file1
+#              + CONFLICT (implicit dir rename): A/file1 in way of C/file1
+#              + CONFLICT (rename/delete): D/file2
+#
+
+test_setup_12q () {
+	git init 12q &&
+	(
+		cd 12q &&
+
+		mkdir -p A B C &&
+		echo 1 >A/file1 &&
+		echo 2 >B/file1 &&
+		echo other >C/other &&
+		echo Astuff >A/stuff &&
+		echo Bstuff >B/stuff &&
+		git add . &&
+		git commit -m "O" &&
+
+		git branch O &&
+		git branch A &&
+		git branch B &&
+
+		git switch A &&
+		git rm A/file1 &&
+		git mv B/file1 C/ &&
+		git add . &&
+		git commit -m "A" &&
+
+		git switch B &&
+		mkdir -p D &&
+		git mv A/file1 D/file2 &&
+		git mv C/other A/other &&
+		git add . &&
+		git commit -m "B"
+	)
+}
+
+test_expect_success '12q: Directory rename hits other rename source; file removed though' '
+	test_setup_12q &&
+	(
+		cd 12q &&
+
+		git checkout -q A^0 &&
+
+		test_must_fail git -c merge.directoryRenames=conflict merge -s recursive B^0 >out &&
+
+		grep "CONFLICT (rename/delete).*A/file1.*D/file2" out &&
+		grep "CONFLICT (implicit dir rename).*Existing file/dir at A/file1 in the way" out &&
+
+		test_stdout_line_count = 6 git ls-files -s &&
+		test_stdout_line_count = 1 git ls-files -s A/other &&
+		test_stdout_line_count = 1 git ls-files -s A/stuff &&
+		test_stdout_line_count = 1 git ls-files -s B/stuff &&
+		test_stdout_line_count = 2 git ls-files -s D/file2 &&
+
+		# This is a slightly suboptimal resolution; allowing the
+		# rename of C/ -> A/ to affect C/file1 and further rename
+		# it to A/file1 would probably be preferable, but since
+		# A/file1 existed as the source of another rename, allowing
+		# the dir rename of C/file1 -> A/file1 would mean modifying
+		# the code so that renames do not adjust both their source
+		# and target paths in all cases.
+		! grep "CONFLICT (file location)" out &&
+		test_stdout_line_count = 1 git ls-files -s C/file1
+	)
+'
 
 ###########################################################################
 # SECTION 13: Checking informational and conflict messages