diff --git a/doc/source/whatsnew/v0.16.2.txt b/doc/source/whatsnew/v0.16.2.txt
index ddfe6fa0b2f74..72fba51797783 100644
--- a/doc/source/whatsnew/v0.16.2.txt
+++ b/doc/source/whatsnew/v0.16.2.txt
@@ -59,6 +59,9 @@ Bug Fixes
 - Bug in ``Categorical`` repr with ``display.width`` of ``None`` in Python 3 (:issue:`10087`)
 
 - Bug in groupby.apply aggregation for Categorical not preserving categories (:issue:`10138`)
+
+- Bug in cache updating when consolidating (:issue:`10264`)
+
 - Bug in ``mean()`` where integer dtypes can overflow (:issue:`10172`)
 - Bug where Panel.from_dict does not set dtype when specified (:issue:`10058`)
 - Bug in ``Index.union`` raises ``AttributeError`` when passing array-likes. (:issue:`10149`)
diff --git a/pandas/core/generic.py b/pandas/core/generic.py
index d6c7d87bb25b1..3bf90aaf71849 100644
--- a/pandas/core/generic.py
+++ b/pandas/core/generic.py
@@ -1352,6 +1352,7 @@ def take(self, indices, axis=0, convert=True, is_copy=True):
         taken : type of caller
         """
 
+        self._consolidate_inplace()
         new_data = self._data.take(indices,
                                    axis=self._get_block_manager_axis(axis),
                                    convert=True, verify=True)
@@ -2128,8 +2129,10 @@ def _protect_consolidate(self, f):
         return result
 
     def _consolidate_inplace(self):
-        f = lambda: self._data.consolidate()
-        self._data = self._protect_consolidate(f)
+        """ we are inplace consolidating; return None """
+        def f():
+            self._data = self._data.consolidate()
+        self._protect_consolidate(f)
 
     def consolidate(self, inplace=False):
         """
diff --git a/pandas/core/indexing.py b/pandas/core/indexing.py
index e0f06e22c431b..c23b691e0fe3a 100644
--- a/pandas/core/indexing.py
+++ b/pandas/core/indexing.py
@@ -369,6 +369,7 @@ def _setitem_with_indexer(self, indexer, value):
                     # we can directly set the series here
                     # as we select a slice indexer on the mi
                     idx = index._convert_slice_indexer(idx)
+                    obj._consolidate_inplace()
                     obj = obj.copy()
                     obj._data = obj._data.setitem(indexer=tuple([idx]), value=value)
                     self.obj[item] = obj
@@ -396,6 +397,7 @@ def setter(item, v):
                     s = v
                 else:
                     # set the item, possibly having a dtype change
+                    s._consolidate_inplace()
                     s = s.copy()
                     s._data = s._data.setitem(indexer=pi, value=v)
                     s._maybe_update_cacher(clear=True)
@@ -492,6 +494,7 @@ def can_do_equal_len():
             self.obj._check_is_chained_assignment_possible()
 
             # actually do the set
+            self.obj._consolidate_inplace()
             self.obj._data = self.obj._data.setitem(indexer=indexer, value=value)
             self.obj._maybe_update_cacher(clear=True)
 
diff --git a/pandas/core/internals.py b/pandas/core/internals.py
index 3395ea360165e..8b37033749c9c 100644
--- a/pandas/core/internals.py
+++ b/pandas/core/internals.py
@@ -2830,13 +2830,13 @@ def consolidate(self):
             return self
 
         bm = self.__class__(self.blocks, self.axes)
+        bm._is_consolidated = False
         bm._consolidate_inplace()
         return bm
 
     def _consolidate_inplace(self):
         if not self.is_consolidated():
             self.blocks = tuple(_consolidate(self.blocks))
-
             self._is_consolidated = True
             self._known_consolidated = True
             self._rebuild_blknos_and_blklocs()
diff --git a/pandas/tests/test_indexing.py b/pandas/tests/test_indexing.py
index c998ce65791a3..5b60475ffcf33 100644
--- a/pandas/tests/test_indexing.py
+++ b/pandas/tests/test_indexing.py
@@ -3527,6 +3527,18 @@ def test_cache_updating(self):
         result = df.loc[(0,0),'z']
         self.assertEqual(result, 2)
 
+        # 10264
+        df = DataFrame(np.zeros((5,5),dtype='int64'),columns=['a','b','c','d','e'],index=range(5))
+        df['f'] = 0
+        df.f.values[3] = 1
+        y = df.iloc[np.arange(2,len(df))]
+        df.f.values[3] = 2
+        expected = DataFrame(np.zeros((5,6),dtype='int64'),columns=['a','b','c','d','e','f'],index=range(5))
+        expected.at[3,'f'] = 2
+        assert_frame_equal(df, expected)
+        expected = Series([0,0,0,2,0],name='f')
+        assert_series_equal(df.f, expected)
+
     def test_slice_consolidate_invalidate_item_cache(self):
 
         # this is chained assignment, but will 'work'