diff --git a/src/plugins/cmakeprojectmanager/cmakeprojectnodes.h b/src/plugins/cmakeprojectmanager/cmakeprojectnodes.h
index 74718944017..ad0af9db4b3 100644
--- a/src/plugins/cmakeprojectmanager/cmakeprojectnodes.h
+++ b/src/plugins/cmakeprojectmanager/cmakeprojectnodes.h
@@ -72,6 +72,7 @@ public:
 
     void setVisibleAfterAddFileAction(bool visibleAfterAddFileAction);
 
+    using ProjectExplorer::Node::setFilePath;
 private:
     QString m_tooltip;
     Utils::FilePath m_buildDirectory;
diff --git a/src/plugins/cmakeprojectmanager/fileapidataextractor.cpp b/src/plugins/cmakeprojectmanager/fileapidataextractor.cpp
index 0d8a9e71f01..9ef2d86e8ef 100644
--- a/src/plugins/cmakeprojectmanager/fileapidataextractor.cpp
+++ b/src/plugins/cmakeprojectmanager/fileapidataextractor.cpp
@@ -825,6 +825,9 @@ static void addTargets(FolderNode *root,
                     folderDir, createSourceGroupNode(td.folderTargetProperty, folderDir, root));
 
             tNode = createTargetNode(folderNodes, folderDir, t.name);
+
+            // Set the correct source directory, not the FOLDER property value
+            tNode->setFilePath(dir);
         } else {
             tNode = createTargetNode(cmakeListsNodes, dir, t.name);
         }