diff --git a/ChangeLog b/ChangeLog
index 8edb20df7..a4ea90a82 100644
--- a/ChangeLog
+++ b/ChangeLog
@@ -1,3 +1,7 @@
+20010102
+ - (bal) Makefile fix where sourcedir != builddir by Corinna Vinschen 
+   <vinschen@redhat.com>
+
 20010101
  - (bal) Minor fix to Makefile to stop rebuilding executables if no
    changes have occured to any of the supporting code.  Patch by
diff --git a/Makefile.in b/Makefile.in
index 91eb81efd..7880ab5e1 100644
--- a/Makefile.in
+++ b/Makefile.in
@@ -19,7 +19,7 @@ CC=@CC@
 LD=@LD@
 PATHS=-DETCDIR=\"$(sysconfdir)\" -D_PATH_SSH_PROGRAM=\"$(SSH_PROGRAM)\" -D_PATH_SSH_ASKPASS_DEFAULT=\"$(ASKPASS_PROGRAM)\"
 CFLAGS=@CFLAGS@
-CPPFLAGS=@CPPFLAGS@ -I. -Iopenbsd-compat/ -I$(srcdir) $(PATHS) @DEFS@
+CPPFLAGS=@CPPFLAGS@ -I. -I$(srcdir)/openbsd-compat -I$(srcdir) $(PATHS) @DEFS@
 LIBS=@LIBS@
 AR=@AR@
 RANLIB=@RANLIB@
diff --git a/openbsd-compat/Makefile.in b/openbsd-compat/Makefile.in
index 1c745fb8c..f87396887 100644
--- a/openbsd-compat/Makefile.in
+++ b/openbsd-compat/Makefile.in
@@ -3,10 +3,11 @@ piddir=@piddir@
 srcdir=@srcdir@
 top_srcdir=@top_srcdir@
 
+VPATH=@srcdir@
 CC=@CC@
 LD=@LD@
 CFLAGS=@CFLAGS@
-CPPFLAGS=@CPPFLAGS@ -I. -I.. -I$(srcdir) @DEFS@
+CPPFLAGS=@CPPFLAGS@ -I. -I.. -I$(srcdir) -I$(srcdir)/.. @DEFS@
 LIBS=@LIBS@
 AR=@AR@
 RANLIB=@RANLIB@