diff --git a/poky/bitbake/lib/bb/fetch2/gitsm.py b/poky/bitbake/lib/bb/fetch2/gitsm.py
index 1f03ba7..c622771 100644
--- a/poky/bitbake/lib/bb/fetch2/gitsm.py
+++ b/poky/bitbake/lib/bb/fetch2/gitsm.py
@@ -117,7 +117,7 @@
 
             url += ';protocol=%s' % proto
             url += ";name=%s" % module
-            url += ";subpath=%s" % paths[module]
+            url += ";subpath=%s" % module
 
             ld = d.createCopy()
             # Not necessary to set SRC_URI, since we're passing the URI to
@@ -184,7 +184,7 @@
 
             try:
                 newfetch = Fetch([url], d, cache=False)
-                newfetch.unpack(root=os.path.dirname(os.path.join(repo_conf, 'modules', modpath)))
+                newfetch.unpack(root=os.path.dirname(os.path.join(repo_conf, 'modules', module)))
             except Exception as e:
                 logger.error('gitsm: submodule unpack failed: %s %s' % (type(e).__name__, str(e)))
                 raise
@@ -199,9 +199,9 @@
 
             # Ensure the submodule repository is NOT set to bare, since we're checking it out...
             try:
-                runfetchcmd("%s config core.bare false" % (ud.basecmd), d, quiet=True, workdir=os.path.join(repo_conf, 'modules', modpath))
+                runfetchcmd("%s config core.bare false" % (ud.basecmd), d, quiet=True, workdir=os.path.join(repo_conf, 'modules', module))
             except:
-                logger.error("Unable to set git config core.bare to false for %s" % os.path.join(repo_conf, 'modules', modpath))
+                logger.error("Unable to set git config core.bare to false for %s" % os.path.join(repo_conf, 'modules', module))
                 raise
 
         Git.unpack(self, ud, destdir, d)
@@ -209,5 +209,7 @@
         ret = self.process_submodules(ud, ud.destdir, unpack_submodules, d)
 
         if not ud.bareclone and ret:
-            # Run submodule update, this sets up the directories -- without touching the config
+            # All submodules should already be downloaded and configured in the tree.  This simply sets
+            # up the configuration and checks out the files.  The main project config should remain
+            # unmodified, and no download from the internet should occur.
             runfetchcmd("%s submodule update --recursive --no-fetch" % (ud.basecmd), d, quiet=True, workdir=ud.destdir)
diff --git a/poky/bitbake/lib/bb/tests/fetch.py b/poky/bitbake/lib/bb/tests/fetch.py
index 97656df..6bdf041 100644
--- a/poky/bitbake/lib/bb/tests/fetch.py
+++ b/poky/bitbake/lib/bb/tests/fetch.py
@@ -964,6 +964,33 @@
         self.assertTrue(os.path.exists(os.path.join(repo_path, '.git/modules/third_party/googletest/config')), msg='Missing submodule config "third_party/googletest/config"')
         self.assertTrue(os.path.exists(os.path.join(repo_path, '.git/modules/third_party/HdrHistogram_c/config')), msg='Missing submodule config "third_party/HdrHistogram_c/config"')
 
+    def test_git_submodule_iotedge(self):
+        """ Prevent regression on deeply nested submodules not being checked out properly, even though they were fetched. """
+
+        # This repository also has submodules where the module (name), path and url do not align
+        url = "gitsm://github.com/azure/iotedge.git;protocol=git;rev=d76e0316c6f324345d77c48a83ce836d09392699"
+        fetcher = bb.fetch.Fetch([url], self.d)
+        fetcher.download()
+        # Previous cwd has been deleted
+        os.chdir(os.path.dirname(self.unpackdir))
+        fetcher.unpack(self.unpackdir)
+
+        repo_path = os.path.join(self.tempdir, 'unpacked', 'git')
+
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/c-shared/README.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/c-shared/testtools/ctest/README.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/c-shared/testtools/testrunner/readme.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/c-shared/testtools/umock-c/readme.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/c-shared/testtools/umock-c/deps/ctest/README.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/c-shared/testtools/umock-c/deps/testrunner/readme.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/utpm/README.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/utpm/deps/c-utility/README.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/utpm/deps/c-utility/testtools/ctest/README.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/utpm/deps/c-utility/testtools/testrunner/readme.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/utpm/deps/c-utility/testtools/umock-c/readme.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/utpm/deps/c-utility/testtools/umock-c/deps/ctest/README.md')), msg='Missing submodule checkout')
+        self.assertTrue(os.path.exists(os.path.join(repo_path, 'edgelet/hsm-sys/azure-iot-hsm-c/deps/utpm/deps/c-utility/testtools/umock-c/deps/testrunner/readme.md')), msg='Missing submodule checkout')
+
 class TrustedNetworksTest(FetcherTest):
     def test_trusted_network(self):
         # Ensure trusted_network returns False when the host IS in the list.