diff --git a/packages/next/src/build/entries.ts b/packages/next/src/build/entries.ts
index c606894ac9..d718564b47 100644
--- a/packages/next/src/build/entries.ts
+++ b/packages/next/src/build/entries.ts
@@ -85,11 +85,12 @@ export async function getStaticInfoIncludingLayouts({
       }
     : pageStaticInfo
 
-  if (isInsideAppDir) {
+  if (isInsideAppDir && appDir) {
     const layoutFiles = []
     const potentialLayoutFiles = pageExtensions.map((ext) => 'layout.' + ext)
     let dir = dirname(pageFilePath)
-    while (dir !== appDir) {
+    // Uses startsWith to not include directories further up.
+    while (dir.startsWith(appDir)) {
       for (const potentialLayoutFile of potentialLayoutFiles) {
         const layoutFile = join(dir, potentialLayoutFile)
         if (!(await fileExists(layoutFile))) {
diff --git a/test/e2e/app-dir/app/app/layout.js b/test/e2e/app-dir/app/app/layout.js
index 65adafbd7e..df63b571d2 100644
--- a/test/e2e/app-dir/app/app/layout.js
+++ b/test/e2e/app-dir/app/app/layout.js
@@ -4,6 +4,7 @@ import '../styles/global.css'
 import './style.css'
 
 export const revalidate = 0
+export const preferredRegion = 'sfo1'
 
 async function getData() {
   return {
diff --git a/test/e2e/app-dir/app/index.test.ts b/test/e2e/app-dir/app/index.test.ts
index 78a8175fbb..ca49e41ee3 100644
--- a/test/e2e/app-dir/app/index.test.ts
+++ b/test/e2e/app-dir/app/index.test.ts
@@ -29,6 +29,11 @@ createNextDescribe(
         expect(middlewareManifest.functions['/test-page/page'].regions).toEqual(
           ['home']
         )
+
+        // Inherits from the root layout.
+        expect(
+          middlewareManifest.functions['/slow-page-with-loading/page'].regions
+        ).toEqual(['sfo1'])
       })
     }