diff --git a/poetry/core/masonry/builders/sdist.py b/poetry/core/masonry/builders/sdist.py
index 9f6b4de71..0bf375498 100644
--- a/poetry/core/masonry/builders/sdist.py
+++ b/poetry/core/masonry/builders/sdist.py
@@ -240,7 +240,15 @@ def find_nearest_pkg(rel_path):
             if from_top_level == ".":
                 continue
 
-            is_subpkg = any([filename.endswith(".py") for filename in filenames])
+            is_subpkg = any(
+                [filename.endswith(".py") for filename in filenames]
+            ) and not all(
+                [
+                    self.is_excluded(Path(path, filename).relative_to(self._path))
+                    for filename in filenames
+                    if filename.endswith(".py")
+                ]
+            )
             if is_subpkg:
                 subpkg_paths.add(from_top_level)
                 parts = from_top_level.split(os.sep)
diff --git a/tests/masonry/builders/fixtures/excluded_subpackage/README.rst b/tests/masonry/builders/fixtures/excluded_subpackage/README.rst
new file mode 100644
index 000000000..b00640203
--- /dev/null
+++ b/tests/masonry/builders/fixtures/excluded_subpackage/README.rst
@@ -0,0 +1,2 @@
+My Package
+==========
\ No newline at end of file
diff --git a/tests/masonry/builders/fixtures/excluded_subpackage/example/__init__.py b/tests/masonry/builders/fixtures/excluded_subpackage/example/__init__.py
new file mode 100644
index 000000000..3dc1f76bc
--- /dev/null
+++ b/tests/masonry/builders/fixtures/excluded_subpackage/example/__init__.py
@@ -0,0 +1 @@
+__version__ = "0.1.0"
diff --git a/tests/masonry/builders/fixtures/excluded_subpackage/example/test/__init__.py b/tests/masonry/builders/fixtures/excluded_subpackage/example/test/__init__.py
new file mode 100644
index 000000000..e69de29bb
diff --git a/tests/masonry/builders/fixtures/excluded_subpackage/example/test/excluded.py b/tests/masonry/builders/fixtures/excluded_subpackage/example/test/excluded.py
new file mode 100644
index 000000000..bf6e1f896
--- /dev/null
+++ b/tests/masonry/builders/fixtures/excluded_subpackage/example/test/excluded.py
@@ -0,0 +1,5 @@
+from .. import __version__
+
+
+def test_version():
+    assert __version__ == "0.1.0"
diff --git a/tests/masonry/builders/fixtures/excluded_subpackage/pyproject.toml b/tests/masonry/builders/fixtures/excluded_subpackage/pyproject.toml
new file mode 100644
index 000000000..3852bb831
--- /dev/null
+++ b/tests/masonry/builders/fixtures/excluded_subpackage/pyproject.toml
@@ -0,0 +1,18 @@
+[tool.poetry]
+name = "example"
+version = "0.1.0"
+description = ""
+authors = ["Sébastien Eustace <sebastien@eustace.io>"]
+exclude = [
+    "**/test/**/*",
+]
+
+[tool.poetry.dependencies]
+python = "^3.6"
+
+[tool.poetry.dev-dependencies]
+pytest = "^3.0"
+
+[build-system]
+requires = ["poetry>=0.12"]
+build-backend = "poetry.masonry.api"
diff --git a/tests/masonry/builders/test_sdist.py b/tests/masonry/builders/test_sdist.py
index 19daef31e..a3cc7f519 100644
--- a/tests/masonry/builders/test_sdist.py
+++ b/tests/masonry/builders/test_sdist.py
@@ -465,3 +465,18 @@ def test_proper_python_requires_if_three_digits_precision_version_specified():
     parsed = p.parsestr(to_str(pkg_info))
 
     assert parsed["Requires-Python"] == "==2.7.15"
+
+
+def test_excluded_subpackage():
+    poetry = Factory().create_poetry(project("excluded_subpackage"))
+
+    builder = SdistBuilder(poetry)
+    setup = builder.build_setup()
+
+    setup_ast = ast.parse(setup)
+
+    setup_ast.body = [n for n in setup_ast.body if isinstance(n, ast.Assign)]
+    ns = {}
+    exec(compile(setup_ast, filename="setup.py", mode="exec"), ns)
+
+    assert ns["packages"] == ["example"]