diff --git a/[refs] b/[refs]
index 505a6d4d4047..cdc6322f90ab 100644
--- a/[refs]
+++ b/[refs]
@@ -1,2 +1,2 @@
 ---
-refs/heads/master: bd56b30205bc09da0beb80d4ba3d4c7309792da5
+refs/heads/master: 8c087b5183adab186a298f2d6ed39aefdcae413c
diff --git a/trunk/fs/btrfs/inode.c b/trunk/fs/btrfs/inode.c
index 95ea58cb3065..5792816d4fca 100644
--- a/trunk/fs/btrfs/inode.c
+++ b/trunk/fs/btrfs/inode.c
@@ -3472,7 +3472,14 @@ static struct inode *btrfs_new_inode(struct btrfs_trans_handle *trans,
 		root->highest_inode = objectid;
 
 	inode->i_uid = current_fsuid();
-	inode->i_gid = current_fsgid();
+
+	if (dir->i_mode & S_ISGID) {
+		inode->i_gid = dir->i_gid;
+		if (S_ISDIR(mode))
+			mode |= S_ISGID;
+	} else
+		inode->i_gid = current_fsgid();
+
 	inode->i_mode = mode;
 	inode->i_ino = objectid;
 	inode_set_bytes(inode, 0);