diff --git a/src/renderer/html_handlebars/hbs_renderer.rs b/src/renderer/html_handlebars/hbs_renderer.rs
index fbaad523..4341ce3b 100644
--- a/src/renderer/html_handlebars/hbs_renderer.rs
+++ b/src/renderer/html_handlebars/hbs_renderer.rs
@@ -273,7 +273,7 @@ impl Renderer for HtmlHandlebars {
 
         let theme_dir = match html_config.theme {
             Some(ref theme) => theme.to_path_buf(),
-            None => src_dir.join("theme"),
+            None => ctx.root.join("theme"),
         };
 
         let theme = theme::Theme::new(theme_dir);
diff --git a/tests/rendered_output.rs b/tests/rendered_output.rs
index bdb786f0..3b3938d0 100644
--- a/tests/rendered_output.rs
+++ b/tests/rendered_output.rs
@@ -18,7 +18,7 @@ use select::document::Document;
 use select::predicate::{Class, Name, Predicate};
 use tempfile::Builder as TempFileBuilder;
 use mdbook::errors::*;
-use mdbook::utils::fs::file_to_string;
+use mdbook::utils::fs::{file_to_string, write_file};
 use mdbook::config::Config;
 use mdbook::MDBook;
 
@@ -370,6 +370,24 @@ fn by_default_mdbook_use_index_preprocessor_to_convert_readme_to_index() {
     assert_doesnt_contain_strings(&second_index, &unexpected_strings);
 }
 
+#[test]
+fn theme_dir_overrides_work_correctly() {
+    let book_dir = dummy_book::new_copy_of_example_book().unwrap();
+    let book_dir = book_dir.path();
+    let theme_dir = book_dir.join("theme");
+
+    let mut index = ::mdbook::theme::INDEX.to_vec();
+    index.extend_from_slice(b"\n<!-- This is a modified index.hbs! -->");
+
+    write_file(&theme_dir, "index.hbs", &index).unwrap();
+
+    let md = MDBook::load(book_dir).unwrap();
+    md.build().unwrap();
+
+    let built_index = book_dir.join("book").join("index.html");
+    dummy_book::assert_contains_strings(built_index, &["This is a modified index.hbs!"]);
+}
+
 #[cfg(feature = "search")]
 mod search {
     extern crate serde_json;