diff --git a/src/bin.ts b/src/bin.ts
index c303129a3..9d923967d 100644
--- a/src/bin.ts
+++ b/src/bin.ts
@@ -7,7 +7,7 @@ import Module = require('module')
 import arg = require('arg')
 import { diffLines } from 'diff'
 import { Script } from 'vm'
-import { readFileSync, statSync } from 'fs'
+import { readFileSync, statSync, realpathSync } from 'fs'
 import { homedir } from 'os'
 import { VERSION, TSError, parse, Register, register } from './index'
 
@@ -154,6 +154,7 @@ export function main (argv: string[]) {
   }
 
   const cwd = dir || process.cwd()
+  /** Unresolved.  May point to a symlink, not realpath.  May be missing file extension */
   const scriptPath = args._.length ? resolve(cwd, args._[0]) : undefined
   const state = new EvalState(scriptPath || join(cwd, EVAL_FILENAME))
 
@@ -251,7 +252,28 @@ function getCwd (dir?: string, scriptMode?: boolean, scriptPath?: string) {
       throw new TypeError('Script mode cannot be combined with `--dir`')
     }
 
-    return dirname(scriptPath)
+    // Use node's own resolution behavior to ensure we follow symlinks.
+    // scriptPath may omit file extension or point to a directory with or without package.json.
+    // This happens before we are registered, so we tell node's resolver to consider ts, tsx, and jsx files.
+    // In extremely rare cases, is is technically possible to resolve the wrong directory,
+    // because we do not yet know preferTsExts, jsx, nor allowJs.
+    // See also, justification why this will not happen in real-world situations:
+    // https://github.com/TypeStrong/ts-node/pull/1009#issuecomment-613017081
+    const exts = ['.js', '.jsx', '.ts', '.tsx']
+    const extsTemporarilyInstalled: string[] = []
+    for (const ext of exts) {
+      if (!hasOwnProperty(require.extensions, ext)) { // tslint:disable-line
+        extsTemporarilyInstalled.push(ext)
+        require.extensions[ext] = function() {} // tslint:disable-line
+      }
+    }
+    try {
+      return dirname(require.resolve(scriptPath))
+    } finally {
+      for (const ext of extsTemporarilyInstalled) {
+        delete require.extensions[ext] // tslint:disable-line
+      }
+    }
   }
 
   return dir
@@ -481,6 +503,11 @@ function isRecoverable (error: TSError) {
   return error.diagnosticCodes.every(code => RECOVERY_CODES.has(code))
 }
 
+/** Safe `hasOwnProperty` */
+function hasOwnProperty (object: any, property: string): boolean {
+  return Object.prototype.hasOwnProperty.call(object, property)
+}
+
 if (require.main === module) {
   main(process.argv.slice(2))
 }
diff --git a/src/index.spec.ts b/src/index.spec.ts
index 29b90495a..ce3ba1639 100644
--- a/src/index.spec.ts
+++ b/src/index.spec.ts
@@ -379,6 +379,14 @@ describe('ts-node', function () {
           expect(err).to.equal(null)
           expect(stdout).to.equal('.ts\n')
 
+          return done()
+        })
+      })
+      it('should read tsconfig relative to realpath, not symlink, in scriptMode', function (done) {
+        exec(`node ${BIN_SCRIPT_PATH} tests/main-realpath/symlink/symlink.tsx`, function (err, stdout) {
+          expect(err).to.equal(null)
+          expect(stdout).to.equal('')
+
           return done()
         })
       })
diff --git a/tests/main-realpath/symlink/symlink.tsx b/tests/main-realpath/symlink/symlink.tsx
new file mode 120000
index 000000000..c2c3efb1f
--- /dev/null
+++ b/tests/main-realpath/symlink/symlink.tsx
@@ -0,0 +1 @@
+../target/target.tsx
\ No newline at end of file
diff --git a/tests/main-realpath/symlink/tsconfig.json b/tests/main-realpath/symlink/tsconfig.json
new file mode 100644
index 000000000..9f78b68d0
--- /dev/null
+++ b/tests/main-realpath/symlink/tsconfig.json
@@ -0,0 +1 @@
+this tsconfig is intentionally invalid, to confirm that ts-node does *not* attempt to parse it
diff --git a/tests/main-realpath/target/target.tsx b/tests/main-realpath/target/target.tsx
new file mode 100644
index 000000000..1a206f56d
--- /dev/null
+++ b/tests/main-realpath/target/target.tsx
@@ -0,0 +1,4 @@
+// Will throw a compiler error unless ./tsconfig.json is parsed, which enables JSX
+function foo() {
+  <div></div>
+}
diff --git a/tests/main-realpath/target/tsconfig.json b/tests/main-realpath/target/tsconfig.json
new file mode 100644
index 000000000..986627de2
--- /dev/null
+++ b/tests/main-realpath/target/tsconfig.json
@@ -0,0 +1,5 @@
+{
+  "compilerOptions": {
+    "jsx": "react"
+  }
+}