diff --git a/examples/global_consumer/BUILD.bazel b/examples/global_consumer/BUILD.bazel
new file mode 100644
index 00000000..a8788436
--- /dev/null
+++ b/examples/global_consumer/BUILD.bazel
@@ -0,0 +1,24 @@
+load("@aspect_bazel_lib//lib:write_source_files.bzl", "write_source_files")
+load("@aspect_rules_ts//ts:defs.bzl", "ts_project")
+load("@bazel_skylib//rules:build_test.bzl", "build_test")
+
+ts_project(
+    name = "lib",
+    srcs = [
+        "index.ts",
+        "//examples/global_dts_generated_tsconfig:lib_types",
+    ],
+    tsconfig = {},
+)
+
+build_test(
+    name = "test",
+    targets = [":lib"],
+)
+
+write_source_files(
+    name = "generated_tsconfig",
+    files = {
+        "tsconfig_gen.json.expected": ":_gen_tsconfig_lib",
+    },
+)
diff --git a/examples/global_consumer/index.ts b/examples/global_consumer/index.ts
new file mode 100644
index 00000000..1ebe5bf0
--- /dev/null
+++ b/examples/global_consumer/index.ts
@@ -0,0 +1,3 @@
+if (myGlobalFunction(42) != myGlobalResult) {
+    console.log('Not equal!?')
+}
diff --git a/examples/global_consumer/tsconfig_gen.json.expected b/examples/global_consumer/tsconfig_gen.json.expected
new file mode 100644
index 00000000..aaf1e17d
--- /dev/null
+++ b/examples/global_consumer/tsconfig_gen.json.expected
@@ -0,0 +1 @@
+{"compilerOptions":{"allowJs":false,"declaration":false,"declarationMap":false,"emitDeclarationOnly":false,"noEmit":false,"resolveJsonModule":null,"sourceMap":false},"files":["./index.ts", "./../../examples/global_dts_generated_tsconfig/index.d.ts", "./../../examples/global_dts_generated_tsconfig/global.d.ts"]}
\ No newline at end of file
diff --git a/examples/global_dts_generated_tsconfig/BUILD.bazel b/examples/global_dts_generated_tsconfig/BUILD.bazel
index 71e079f5..904c1d7d 100644
--- a/examples/global_dts_generated_tsconfig/BUILD.bazel
+++ b/examples/global_dts_generated_tsconfig/BUILD.bazel
@@ -1,3 +1,4 @@
+load("@aspect_bazel_lib//lib:write_source_files.bzl", "write_source_files")
 load("@aspect_rules_ts//ts:defs.bzl", "ts_project")
 load("@bazel_skylib//rules:build_test.bzl", "build_test")
 
@@ -9,7 +10,7 @@ ts_project(
     ],
     # Intentionally a generated config to catch regressions of
     # https://github.com/aspect-build/rules_ts/issues/204
-    tsconfig = {"declaration": True},
+    tsconfig = {"compilerOptions": {"declaration": True}},
     visibility = ["//examples:__subpackages__"],
 )
 
@@ -17,3 +18,10 @@ build_test(
     name = "test",
     targets = [":lib"],
 )
+
+write_source_files(
+    name = "generated_tsconfig",
+    files = {
+        "tsconfig_gen.json.expected": ":_gen_tsconfig_lib",
+    },
+)
diff --git a/examples/global_dts_generated_tsconfig/global.d.ts b/examples/global_dts_generated_tsconfig/global.d.ts
index 793acd22..9975c87d 100644
--- a/examples/global_dts_generated_tsconfig/global.d.ts
+++ b/examples/global_dts_generated_tsconfig/global.d.ts
@@ -1 +1,3 @@
+// A global definition within a .d.ts file
+
 declare function myGlobalFunction(a: number): string
diff --git a/examples/global_dts_generated_tsconfig/index.ts b/examples/global_dts_generated_tsconfig/index.ts
index 5472e85a..e754b444 100644
--- a/examples/global_dts_generated_tsconfig/index.ts
+++ b/examples/global_dts_generated_tsconfig/index.ts
@@ -1 +1,11 @@
-myGlobalFunction(42)
+;(typeof globalThis !== 'undefined'
+    ? globalThis
+    : (window as any)
+).myGlobalResult = myGlobalFunction(42)
+
+export {}
+
+// A definition within a .ts file that must be compiled.
+declare global {
+    const myGlobalResult: string
+}
diff --git a/examples/global_dts_generated_tsconfig/tsconfig_gen.json.expected b/examples/global_dts_generated_tsconfig/tsconfig_gen.json.expected
new file mode 100644
index 00000000..75fec4c1
--- /dev/null
+++ b/examples/global_dts_generated_tsconfig/tsconfig_gen.json.expected
@@ -0,0 +1 @@
+{"compilerOptions":{"allowJs":false,"declaration":true,"declarationMap":false,"emitDeclarationOnly":false,"noEmit":false,"resolveJsonModule":null,"sourceMap":false},"files":["./global.d.ts", "./index.ts"]}
\ No newline at end of file
diff --git a/ts/private/ts_config.bzl b/ts/private/ts_config.bzl
index 888d0acf..b37bd470 100644
--- a/ts/private/ts_config.bzl
+++ b/ts/private/ts_config.bzl
@@ -114,14 +114,6 @@ extended configuration file as well, to pass them both to the TypeScript compile
     toolchains = COPY_FILE_TO_BIN_TOOLCHAINS,
 )
 
-def _filter_input_files(files, allow_js, resolve_json_module):
-    return [
-        f
-        for f in files
-        # include typescript, json & declaration sources
-        if _lib.is_ts_src(f.basename, allow_js, resolve_json_module) or _lib.is_typings_src(f.basename)
-    ]
-
 def _write_tsconfig_rule(ctx):
     # TODO: is it useful to expand Make variables in the content?
     content = ctx.attr.content
@@ -135,22 +127,30 @@ def _write_tsconfig_rule(ctx):
             extends_path = "./" + extends_path
         content = content.replace("__extends__", extends_path)
 
-    filtered_files = _filter_input_files(ctx.files.files, ctx.attr.allow_js, ctx.attr.resolve_json_module)
-
-    # Update file paths to be relative to the tsconfig file, including a ./ prefix
-    # to ensure paths are all relative to the config file.
-    package_prefix = ctx.label.package + "/"
-
-    # If the target is inside another workspace, we will need to also add the workspace
-    # root to the prefix.
+    # The prefix of source files that are within the same package as the tsconfig file.
+    local_package_prefix = "%s/" % ctx.label.package if ctx.label.package else ""
     if (len(ctx.label.repo_name) > 0):
-        package_prefix = "../{}/{}".format(ctx.label.repo_name, package_prefix)
-    filtered_files = [
-        "./" + f.short_path.removeprefix(package_prefix)
-        for f in filtered_files
-    ]
-
-    content = content.replace("\"__files__\"", str(filtered_files))
+        # If the target is inside another workspace the prefix also contains the navigation to that workspace.
+        local_package_prefix = "../{}/{}".format(ctx.label.repo_name, local_package_prefix)
+
+    # The path to navigate to the root of the workspace
+    path_to_root = "/".join([".."] * (ctx.label.package.count("/") + 1))
+
+    # Compute the list of source files with paths relative to the generated tsconfig file.
+    src_files = []
+    for f in ctx.files.files:
+        # Only include typescript source files
+        if not (_lib.is_ts_src(f.basename, ctx.attr.allow_js, ctx.attr.resolve_json_module) or _lib.is_typings_src(f.basename)):
+            continue
+
+        if f.short_path.startswith(local_package_prefix):
+            # Files within this project or subdirs can avoid the ugly ../ prefix
+            src_files.append("./{}".format(f.short_path.removeprefix(local_package_prefix)))
+        else:
+            # Files from parent/sibling projects must navigate up to the workspace root
+            src_files.append("./{}/{}".format(path_to_root, f.short_path))
+
+    content = content.replace("\"__files__\"", str(src_files))
     ctx.actions.write(
         output = ctx.outputs.out,
         content = content,