diff --git a/debian/changelog b/debian/changelog
index 7fd195c1..3b66908f 100644
--- a/debian/changelog
+++ b/debian/changelog
@@ -1,6 +1,7 @@
 wine-staging (1.7.35) UNRELEASED; urgency=low
   * Add support for patchinstall.sh parameters '--no-patchlist' and '--no-autoconf'.
   * Add support for Gentoo epatch backend to patchinstall.sh.
+  * Automatically enable fallback method to apply patches when running from inside of a git subdirectory.
   * Synchronize CSMT patchset with https://github.com/stefand/wine.
   * Several improvements to make nvcuvid (CUDA video decoding) better compatible with x86_64.
   * Added patch to implement support for DDS file format in D3DXSaveTextureToFileInMemory.
diff --git a/debian/tools/patchinstall.sh.in b/debian/tools/patchinstall.sh.in
index a5a580c7..d052fb32 100644
--- a/debian/tools/patchinstall.sh.in
+++ b/debian/tools/patchinstall.sh.in
@@ -67,6 +67,7 @@ if test "$#" -eq 0; then
 	abort "No commandline arguments given, don't know what to do."
 fi
 
+# Parse commandline arguments
 while test "$#" -gt 0; do
 	if patch_enable "$1" "$enable"; then
 		shift
@@ -124,13 +125,36 @@ if test "$enable" -ne 1; then
 	abort "Missing argument for -W, expected patchname."
 fi
 
+# Determine DESTDIR if not explicitly specified
+if test -z "$DESTDIR" -a -f ./tools/make_requests; then
+	DESTDIR="$(pwd)"
+
+elif test ! -f "$DESTDIR/tools/make_requests"; then
+	abort "DESTDIR does not point to the Wine source tree."
+fi
+
+# Most backends will try to use git, either directly or indirectly.
+# Unfortunately this does not work when "$DESTDIR" points to a
+# subdirectory of a git tree, which has the effect that no patches
+# are applied, but the exitcode is zero. To avoid broken builds we
+# will workaround this issue or abort. For more information see
+# https://github.com/wine-compholio/wine-staging/issues/7
+test ! -d "$DESTDIR/.git" && (cd "$DESTDIR"; git rev-parse --git-dir) &> /dev/null
+workaround_git_bug="$?"
+
 # Apply the patches using gitapply.sh, a small wrapper around 'patch'
 if test "$backend" = "patch"; then
 
+	if test "$workaround_git_bug" -eq 0; then
+		gitapply_args="--nogit"
+	else
+		gitapply_args=""
+	fi
+
 	patch_apply ()
 	{{
 		echo "Applying $1"
-		if ! ../debian/tools/gitapply.sh -d "$DESTDIR" < "$1"; then
+		if ! ../debian/tools/gitapply.sh $gitapply_args -d "$DESTDIR" < "$1"; then
 			abort "Failed to apply patch, aborting!"
 		fi
 	}}
@@ -138,15 +162,21 @@ if test "$backend" = "patch"; then
 # 'epatch' backend - used on Gentoo
 elif test "$backend" = "epatch"; then
 
+	if test "$workaround_git_bug" -eq 0; then
+		gitapply_args="--nogit"
+	else
+		gitapply_args=""
+	fi
+
 	patch_apply ()
 	{{
 		if grep -q "^GIT binary patch" "$1"; then
-			if ! ../debian/tools/gitapply.sh -d "$DESTDIR" < "$1"; then
+			if ! ../debian/tools/gitapply.sh $gitapply_args -d "$DESTDIR" < "$1"; then
 				abort "Failed to apply patch, aborting!"
 			fi
 		else
-			local patch="$(readlink -f "$1")"
-			if ! (cd "$DESTDIR" && epatch "$patch"); then
+			current_patch="$(readlink -f "$1")"
+			if ! (cd "$DESTDIR" && epatch "$current_patch"); then
 				abort "Failed to apply patch, aborting!"
 			fi
 		fi
@@ -155,6 +185,10 @@ elif test "$backend" = "epatch"; then
 # GIT backend - apply patches using 'git am'
 elif test "$backend" = "git" -o "$backend" = "git-am"; then
 
+	if test "$workaround_git_bug" -eq 0; then
+		abort "Backend 'git-am' not possible when DESTDIR points to a git subdirectory."
+	fi
+
 	patch_apply ()
 	{{
 		echo "Applying $1"
@@ -166,6 +200,10 @@ elif test "$backend" = "git" -o "$backend" = "git-am"; then
 # Git apply backend
 elif test "$backend" = "git-apply"; then
 
+	if test "$workaround_git_bug" -eq 0; then
+		abort "Backend 'git-apply' not possible when DESTDIR points to a git subdirectory."
+	fi
+
 	patch_apply ()
 	{{
 		echo "Applying $1"
@@ -177,6 +215,10 @@ elif test "$backend" = "git-apply"; then
 # Stacked GIT backend - import the patches (mainly for developers)
 elif test "$backend" = "stg"; then
 
+	if test "$workaround_git_bug" -eq 0; then
+		abort "Backend 'stg' not possible when DESTDIR points to a git subdirectory."
+	fi
+
 	# Only import the regular patches, no autogenerated ones -
 	# moreover, don't run autoreconf or ./tools/make_requests.
 	enable_patchlist=0
@@ -198,13 +240,6 @@ fi
 {patch_resolver}
 
 
-if test -z "$DESTDIR" -a -f ./tools/make_requests; then
-	DESTDIR="$(pwd)"
-
-elif test ! -f "$DESTDIR/tools/make_requests"; then
-	abort "DESTDIR does not point to the Wine source tree."
-fi
-
 # To make sure we find all the patches and tools switch to the patches directory now
 script="$(readlink -f "$0")"
 curdir="$(dirname "$script")"
diff --git a/patches/patchinstall.sh b/patches/patchinstall.sh
index df65b5ad..22c67e4b 100755
--- a/patches/patchinstall.sh
+++ b/patches/patchinstall.sh
@@ -613,6 +613,7 @@ if test "$#" -eq 0; then
 	abort "No commandline arguments given, don't know what to do."
 fi
 
+# Parse commandline arguments
 while test "$#" -gt 0; do
 	if patch_enable "$1" "$enable"; then
 		shift
@@ -670,13 +671,36 @@ if test "$enable" -ne 1; then
 	abort "Missing argument for -W, expected patchname."
 fi
 
+# Determine DESTDIR if not explicitly specified
+if test -z "$DESTDIR" -a -f ./tools/make_requests; then
+	DESTDIR="$(pwd)"
+
+elif test ! -f "$DESTDIR/tools/make_requests"; then
+	abort "DESTDIR does not point to the Wine source tree."
+fi
+
+# Most backends will try to use git, either directly or indirectly.
+# Unfortunately this does not work when "$DESTDIR" points to a
+# subdirectory of a git tree, which has the effect that no patches
+# are applied, but the exitcode is zero. To avoid broken builds we
+# will workaround this issue or abort. For more information see
+# https://github.com/wine-compholio/wine-staging/issues/7
+test ! -d "$DESTDIR/.git" && (cd "$DESTDIR"; git rev-parse --git-dir) &> /dev/null
+workaround_git_bug="$?"
+
 # Apply the patches using gitapply.sh, a small wrapper around 'patch'
 if test "$backend" = "patch"; then
 
+	if test "$workaround_git_bug" -eq 0; then
+		gitapply_args="--nogit"
+	else
+		gitapply_args=""
+	fi
+
 	patch_apply ()
 	{
 		echo "Applying $1"
-		if ! ../debian/tools/gitapply.sh -d "$DESTDIR" < "$1"; then
+		if ! ../debian/tools/gitapply.sh $gitapply_args -d "$DESTDIR" < "$1"; then
 			abort "Failed to apply patch, aborting!"
 		fi
 	}
@@ -684,15 +708,21 @@ if test "$backend" = "patch"; then
 # 'epatch' backend - used on Gentoo
 elif test "$backend" = "epatch"; then
 
+	if test "$workaround_git_bug" -eq 0; then
+		gitapply_args="--nogit"
+	else
+		gitapply_args=""
+	fi
+
 	patch_apply ()
 	{
 		if grep -q "^GIT binary patch" "$1"; then
-			if ! ../debian/tools/gitapply.sh -d "$DESTDIR" < "$1"; then
+			if ! ../debian/tools/gitapply.sh $gitapply_args -d "$DESTDIR" < "$1"; then
 				abort "Failed to apply patch, aborting!"
 			fi
 		else
-			local patch="$(readlink -f "$1")"
-			if ! (cd "$DESTDIR" && epatch "$patch"); then
+			current_patch="$(readlink -f "$1")"
+			if ! (cd "$DESTDIR" && epatch "$current_patch"); then
 				abort "Failed to apply patch, aborting!"
 			fi
 		fi
@@ -701,6 +731,10 @@ elif test "$backend" = "epatch"; then
 # GIT backend - apply patches using 'git am'
 elif test "$backend" = "git" -o "$backend" = "git-am"; then
 
+	if test "$workaround_git_bug" -eq 0; then
+		abort "Backend 'git-am' not possible when DESTDIR points to a git subdirectory."
+	fi
+
 	patch_apply ()
 	{
 		echo "Applying $1"
@@ -712,6 +746,10 @@ elif test "$backend" = "git" -o "$backend" = "git-am"; then
 # Git apply backend
 elif test "$backend" = "git-apply"; then
 
+	if test "$workaround_git_bug" -eq 0; then
+		abort "Backend 'git-apply' not possible when DESTDIR points to a git subdirectory."
+	fi
+
 	patch_apply ()
 	{
 		echo "Applying $1"
@@ -723,6 +761,10 @@ elif test "$backend" = "git-apply"; then
 # Stacked GIT backend - import the patches (mainly for developers)
 elif test "$backend" = "stg"; then
 
+	if test "$workaround_git_bug" -eq 0; then
+		abort "Backend 'stg' not possible when DESTDIR points to a git subdirectory."
+	fi
+
 	# Only import the regular patches, no autogenerated ones -
 	# moreover, don't run autoreconf or ./tools/make_requests.
 	enable_patchlist=0
@@ -845,13 +887,6 @@ if test "$enable_ntdll_WRITECOPY" -eq 1; then
 fi
 
 
-if test -z "$DESTDIR" -a -f ./tools/make_requests; then
-	DESTDIR="$(pwd)"
-
-elif test ! -f "$DESTDIR/tools/make_requests"; then
-	abort "DESTDIR does not point to the Wine source tree."
-fi
-
 # To make sure we find all the patches and tools switch to the patches directory now
 script="$(readlink -f "$0")"
 curdir="$(dirname "$script")"