diff --git a/CHANGES b/CHANGES
index f6e4b69d2..8a06d67aa 100644
--- a/CHANGES
+++ b/CHANGES
@@ -56,6 +56,7 @@ Bugs fixed
 * #1176: Fix i18n: footnote reference number missing for auto numbered named
   footnote and auto symbol footnote.
 * PR#146,#1172: Fix ZeroDivisionError in parallel builds. Thanks to tychoish.
+* #1204: Fix wrong generation of links to local intersphinx targets.
 * #1206: Fix i18n: gettext did not translate admonition directive's title.
 * #1232: Sphinx generated broken ePub files on Windows.
 * #1259: Guard the debug output call when emitting events; to prevent the
diff --git a/sphinx/ext/intersphinx.py b/sphinx/ext/intersphinx.py
index bf528e72b..193562b26 100644
--- a/sphinx/ext/intersphinx.py
+++ b/sphinx/ext/intersphinx.py
@@ -33,6 +33,7 @@ from os import path
 import re
 
 from docutils import nodes
+from docutils.utils import relative_path
 
 from sphinx.locale import _
 from sphinx.builders.html import INVENTORY_FILENAME
@@ -236,6 +237,9 @@ def missing_reference(app, env, node, contnode):
             if objtype not in inventory or target not in inventory[objtype]:
                 continue
             proj, version, uri, dispname = inventory[objtype][target]
+            if '://' not in uri and node.get('refdoc'):
+                # get correct path in case of subdirectories
+                uri = path.join(relative_path(node['refdoc'], env.srcdir), uri)
             newnode = nodes.reference('', '', internal=False, refuri=uri,
                           reftitle=_('(in %s v%s)') % (proj, version))
             if node.get('refexplicit'):