diff --git a/src/shared/Context.js b/src/shared/Context.js
index 98c6404674..a7842e1a11 100755
--- a/src/shared/Context.js
+++ b/src/shared/Context.js
@@ -116,14 +116,16 @@ export default class Context {
   getParent(component) {
     let fragment = this.fragment;
 
-    if (fragment.context)
-      fragment = findParentWithContext(fragment.parent || (component && fragment.componentParent));
+    if (!fragment.parent && component) fragment = fragment.componentParent;
     else {
-      fragment = findParentWithContext(fragment.parent || (component && fragment.componentParent));
-      if (fragment)
-        fragment = findParentWithContext(
-          fragment.parent || (component && fragment.componentParent)
-        );
+      if (fragment.context) fragment = findParentWithContext(fragment.parent);
+      else {
+        fragment = findParentWithContext(fragment.parent);
+        if (fragment) {
+          if (!fragment.parent && component) fragment = fragment.componentParent;
+          else fragment = findParentWithContext(fragment.parent);
+        }
+      }
     }
 
     if (!fragment || fragment === this.fragment) return;
diff --git a/tests/browser/context.js b/tests/browser/context.js
index 368a953c65..1239120a63 100644
--- a/tests/browser/context.js
+++ b/tests/browser/context.js
@@ -1251,4 +1251,22 @@ export default function() {
     t.equal(ctx.findAllComponents()[1].get('id'), 'second');
     t.equal(ctx.findAllComponents()[2].get('id'), 'other');
   });
+
+  test('parent context of ractive context for a component is the context immediately surrounding the component', t => {
+    const r = new Ractive({
+      target: fixture,
+      template: '{{#with 99 as bar}}<cmp />{{/with}}',
+      components: {
+        cmp: Ractive.extend()
+      },
+      data: {
+        bar: 42
+      }
+    });
+
+    const cmp = r.findComponent('cmp');
+    const ctx = cmp.getContext().getParent(true);
+
+    t.equal(ctx.get('bar'), 99);
+  });
 }