diff --git a/integration-tests/gradle/src/integrationTest/kotlin/org/jetbrains/dokka/it/gradle/BasicCachingIntegrationTest.kt b/integration-tests/gradle/src/integrationTest/kotlin/org/jetbrains/dokka/it/gradle/BasicCachingIntegrationTest.kt
index f47f7e2a4a..ada6c26c18 100644
--- a/integration-tests/gradle/src/integrationTest/kotlin/org/jetbrains/dokka/it/gradle/BasicCachingIntegrationTest.kt
+++ b/integration-tests/gradle/src/integrationTest/kotlin/org/jetbrains/dokka/it/gradle/BasicCachingIntegrationTest.kt
@@ -20,8 +20,39 @@ class BasicCachingIntegrationTest(override val versions: BuildVersions) : Abstra
 
     @Test
     fun execute() {
+        runAndAssertOutcomeAndContents(TaskOutcome.SUCCESS)
+        runAndAssertOutcomeAndContents(TaskOutcome.FROM_CACHE)
+    }
+
+    @Test
+    fun localDirectoryPointingToRoot() {
+        fun String.findAndReplace(oldValue: String, newValue: String): String {
+            assertTrue(oldValue in this, "Expected to replace '$oldValue'")
+            return replace(oldValue, newValue)
+        }
+        val projectKts = projectDir.resolve("build.gradle.kts")
+
+        projectKts.readText()
+            .findAndReplace("localDirectory.set(file(\"src/main\"))", "localDirectory.set(projectDir)")
+            .findAndReplace("integration-tests/gradle/projects/it-basic/src/main", "integration-tests/gradle/projects/it-basic")
+            .also { projectKts.writeText(it) }
+
+        runAndAssertOutcomeAndContents(TaskOutcome.SUCCESS)
+        projectDir.resolve("unrelated.txt").writeText("modified")
+        // despite projectDir is used as an input in localDirectory, changing its contents shouldn't invalidate the cache
+        runAndAssertOutcomeAndContents(TaskOutcome.FROM_CACHE)
+
+        projectKts.readText()
+            .findAndReplace("localDirectory.set(projectDir)", "localDirectory.set(file(\"src\"))")
+            .also { projectKts.writeText(it) }
+        // changing localDirectory path invalidates cached task results
         runAndAssertOutcome(TaskOutcome.SUCCESS)
-        runAndAssertOutcome(TaskOutcome.FROM_CACHE)
+    }
+
+
+    private fun runAndAssertOutcomeAndContents(expectedOutcome: TaskOutcome) {
+        runAndAssertOutcome(expectedOutcome)
+        File(projectDir, "build/dokka/html").assertHtmlOutputDir()
     }
 
     private fun runAndAssertOutcome(expectedOutcome: TaskOutcome) {
@@ -35,7 +66,5 @@ class BasicCachingIntegrationTest(override val versions: BuildVersions) : Abstra
         ).buildRelaxed()
 
         assertEquals(expectedOutcome, assertNotNull(result.task(":dokkaHtml")).outcome)
-
-        File(projectDir, "build/dokka/html").assertHtmlOutputDir()
     }
 }
diff --git a/integration-tests/gradle/src/integrationTest/kotlin/org/jetbrains/dokka/it/gradle/GradleRelocatedCachingIntegrationTest.kt b/integration-tests/gradle/src/integrationTest/kotlin/org/jetbrains/dokka/it/gradle/GradleRelocatedCachingIntegrationTest.kt
index 28b8d22ccf..2ac129af71 100644
--- a/integration-tests/gradle/src/integrationTest/kotlin/org/jetbrains/dokka/it/gradle/GradleRelocatedCachingIntegrationTest.kt
+++ b/integration-tests/gradle/src/integrationTest/kotlin/org/jetbrains/dokka/it/gradle/GradleRelocatedCachingIntegrationTest.kt
@@ -21,11 +21,11 @@ class GradleRelocatedCachingIntegrationTest(override val versions: BuildVersions
 
     @Test
     fun execute() {
-        runAndAssertOutcome(projectFolder(1), TaskOutcome.SUCCESS)
-        runAndAssertOutcome(projectFolder(2), TaskOutcome.FROM_CACHE)
+        runAndAssertOutcomeAndContents(projectFolder(1), TaskOutcome.SUCCESS)
+        runAndAssertOutcomeAndContents(projectFolder(2), TaskOutcome.FROM_CACHE)
     }
 
-    private fun runAndAssertOutcome(project: File, expectedOutcome: TaskOutcome) {
+    private fun runAndAssertOutcomeAndContents(project: File, expectedOutcome: TaskOutcome) {
         val result = createGradleRunner("clean", "dokkaHtml", "-i", "-s", "-Dorg.gradle.caching.debug=true", "--build-cache")
             .withProjectDir(project)
             .buildRelaxed()
diff --git a/runners/gradle-plugin/src/main/kotlin/org/jetbrains/dokka/gradle/GradleSourceLinkBuilder.kt b/runners/gradle-plugin/src/main/kotlin/org/jetbrains/dokka/gradle/GradleSourceLinkBuilder.kt
index 4a0c133379..b307796d06 100644
--- a/runners/gradle-plugin/src/main/kotlin/org/jetbrains/dokka/gradle/GradleSourceLinkBuilder.kt
+++ b/runners/gradle-plugin/src/main/kotlin/org/jetbrains/dokka/gradle/GradleSourceLinkBuilder.kt
@@ -2,6 +2,7 @@ package org.jetbrains.dokka.gradle
 
 import org.gradle.api.Project
 import org.gradle.api.provider.Property
+import org.gradle.api.provider.Provider
 import org.gradle.api.tasks.*
 import org.jetbrains.dokka.DokkaConfigurationBuilder
 import org.jetbrains.dokka.SourceLinkDefinitionImpl
@@ -30,15 +31,27 @@ class GradleSourceLinkBuilder(
     /**
      * Path to the local source directory. The path must be relative to the root of current project.
      *
+     * This path is used to find relative paths of the source files from which the documentation is built.
+     * These relative paths are then combined with the base url of a source code hosting service specified with
+     * the [remoteUrl] property to create source links for each declaration.
+     *
      * Example:
      *
      * ```kotlin
      * projectDir.resolve("src")
      * ```
      */
-    @InputDirectory
-    @PathSensitive(PathSensitivity.RELATIVE)
+    @Internal // changing contents of the directory should not invalidate the task
     val localDirectory: Property<File?> = project.objects.safeProperty()
+    
+    /**
+     * The relative path to [localDirectory] from the project directory. Declared as an input to invalidate the task if that path changes.
+     * Should not be used anywhere directly.
+     */
+    @Suppress("unused")
+    @get:Input
+    internal val localDirectoryPath: Provider<String?> =
+        localDirectory.map { it.relativeToOrSelf(project.projectDir).invariantSeparatorsPath }
 
     /**
      * URL of source code hosting service that can be accessed by documentation readers,