diff --git a/__tests__/package-hoister.js b/__tests__/package-hoister.js
new file mode 100644
index 0000000000..3dfa965be0
--- /dev/null
+++ b/__tests__/package-hoister.js
@@ -0,0 +1,44 @@
+/* @flow */
+
+import PackageHoister, {HoistManifest} from '../src/package-hoister.js';
+import type PackageResolver from '../src/package-resolver.js';
+import type PackageReference from '../src/package-reference.js';
+import type Config from '../src/config.js';
+import type {Manifest} from '../src/types.js';
+
+const path = require('path');
+
+test('Produces valid destination paths for scoped modules', () => {
+  const expected = path.join(__dirname, './node_modules/@scoped/dep');
+  const scopedPackageName = '@scoped/dep';
+
+  const config = (({
+    cwd: __dirname,
+    getFolder(): string {
+      return 'node_modules';
+    },
+  }: any): Config);
+
+  const resolver = (({}: any): PackageResolver);
+
+  const key = scopedPackageName;
+  const parts = [scopedPackageName];
+
+  const pkg = (({
+    _reference: (({}: any): PackageReference),
+  }: any): Manifest);
+
+  const info = new HoistManifest(key, parts, pkg, '');
+
+  const tree = new Map([
+    ['@scoped/dep', info],
+  ]);
+
+  const packageHoister = new PackageHoister(config, resolver, false);
+  packageHoister.tree = tree;
+
+  const result = packageHoister.init();
+  const [actual] = result[0];
+
+  expect(actual).toEqual(expected);
+});
diff --git a/src/package-hoister.js b/src/package-hoister.js
index ab1c3630f9..19f524e009 100644
--- a/src/package-hoister.js
+++ b/src/package-hoister.js
@@ -349,7 +349,7 @@ export default class PackageHoister {
     for (const [key, info] of this.tree.entries()) {
       // decompress the location and push it to the flat tree. this path could be made
       // up of modules from different registries so we need to handle this specially
-      const parts = [];
+      const parts: Array<string> = [];
       const keyParts = key.split('#');
       for (let i = 0; i < keyParts.length; i++) {
         const key = keyParts.slice(0, i + 1).join('#');
@@ -363,13 +363,15 @@ export default class PackageHoister {
         // remove the first part which will be the folder name and replace it with a
         // hardcoded modules folder
         parts.shift();
-        parts.unshift(this.config.modulesFolder);
+        const modulesFolder = (this.config.modulesFolder == null) ? '' : this.config.modulesFolder;
+        parts.unshift(modulesFolder);
       } else {
         // first part will be the registry-specific module folder
-        parts.unshift(this.config.cwd);
+        const cwd = (this.config.cwd == null) ? '' : this.config.cwd;
+        parts.unshift(cwd);
       }
 
-      const loc = parts.join(path.sep);
+      const loc = path.join(...parts);
       flatTree.push([loc, info]);
     }