diff --git a/lib/ldclient-rb/impl/file_data/watcher.rb b/lib/ldclient-rb/impl/file_data/watcher.rb
index b1d5a474..e1f7d079 100644
--- a/lib/ldclient-rb/impl/file_data/watcher.rb
+++ b/lib/ldclient-rb/impl/file_data/watcher.rb
@@ -28,10 +28,15 @@ module FileData
       # watches the directory of the link's target for the target's name, so that an edit to the
       # target is reported. The links are resolved again after every reported change, after a retry
       # sets up watches, and when a directory that holds a target is deleted, as happens when a
-      # Kubernetes ConfigMap volume is updated. So a link that comes to point elsewhere is followed.
-      # A link that cannot be resolved, for example because its target's directory does not exist
-      # yet or was deleted, is resolved again once per second until its target is watched, and the
-      # callback then runs once.
+      # Kubernetes ConfigMap volume is updated. A link that cannot be resolved, for example because
+      # its target's directory does not exist yet or was deleted, is resolved again once per second
+      # until its target is watched, and the callback then runs once.
+      #
+      # A change that none of those events reports is not followed: a link further along the chain
+      # that is pointed elsewhere while its old target stays, a configured directory that is itself
+      # a link and is pointed elsewhere, or a configured directory that is renamed and replaced.
+      # Deployments that switch files that way, such as a `current` link to a release directory,
+      # should use polling, which reads every configured path on each interval.
       #
       # @private
       #
@@ -274,7 +279,9 @@ def stop
         # The targets of links that changed are dropped, and a watch that served only such targets
         # is removed. A link that cannot be resolved, for example because its target's directory
         # does not exist yet, or whose target's directory cannot be watched, keeps the retry
-        # running, which resolves the links again. Returns true if it added a watch.
+        # running, which resolves the links again. Returns true if it added a watch or if a link
+        # now leads to a target it did not lead to before, which can be in a directory that is
+        # already watched.
         #
         private def refresh_links
           desired = {}
@@ -292,6 +299,13 @@ def stop
           @lock.synchronize do
             return false if @stopped.value
 
+            # A new target in a directory that is already watched is a change. A directory that is
+            # not watched yet counts once its watch is added below, so a watch that keeps failing
+            # does not report a change on every retry.
+            desired.each do |real_directory, names|
+              entry = @watched[real_directory]
+              added = true if entry && !(names - entry.targets).empty?
+            end
             @watched.each { |real_directory, entry| entry.targets = desired[real_directory] || Set.new }
             @watched.delete_if do |_real_directory, entry|
               next false unless entry.directories.empty? && entry.targets.empty?
diff --git a/spec/impl/file_data/watcher_spec.rb b/spec/impl/file_data/watcher_spec.rb
index 181fbe57..07e11885 100644
--- a/spec/impl/file_data/watcher_spec.rb
+++ b/spec/impl/file_data/watcher_spec.rb
@@ -214,6 +214,50 @@ def wait_for_next_file_time(link)
           end
         end
 
+        it "invokes the callback when a link resolves to a target in a directory that is already watched" do
+          Dir.mkdir(path("config"))
+          Dir.mkdir(path("other"))
+          File.write(path("other/other.json"), "{}")
+          # The link leads through data, which does not exist yet, to a directory that the watcher
+          # already watches because another configured file is in it.
+          make_symlink(path("data/flags.json"), path("config/flags.json"))
+          with_watcher([path("config/flags.json"), path("other/other.json")]) do |_watcher, calls|
+            sleep 0.3
+            File.write(path("other/flags.json"), "{}")
+            before = settled(calls)
+
+            make_symlink(path("other"), path("data"))
+            # The retry that resolves the link runs the callback once.
+            expect(wait_for { calls.value > before }).to be true
+          end
+        end
+
+        it "does not invoke the callback on every retry while the directory of a link's target cannot be watched" do
+          Dir.mkdir(path("config"))
+          Dir.mkdir(path("data"))
+          File.write(path("data/flags.json"), "{}")
+          make_symlink(path("data/flags.json"), path("config/flags.json"))
+          data_directory = File.realpath(path("data"))
+          failing = Concurrent::AtomicBoolean.new(true)
+          allow_any_instance_of(Watcher).to receive(:add_watch).and_wrap_original do |original, real_directory|
+            raise "cannot watch #{real_directory}" if failing.true? && real_directory == data_directory
+
+            original.call(real_directory)
+          end
+          with_watcher([path("config/flags.json")]) do |_watcher, calls|
+            # The retry runs once a second. While the watch keeps failing, nothing has changed.
+            sleep 2.5
+            expect(calls.value).to eq 0
+
+            failing.make_false
+            # The retry that watches the target's directory runs the callback once.
+            expect(wait_for { calls.value >= 1 }).to be true
+            before = settled(calls)
+            File.write(path("data/flags.json"), '{"flagValues": {}}')
+            expect(wait_for { calls.value > before }).to be true
+          end
+        end
+
         it "watches the target of a symbolic link once the target's directory appears" do
           Dir.mkdir(path("config"))
           make_symlink(path("data/flags.json"), path("config/flags.json"))