diff --git a/Sources/SKSwiftPMWorkspace/SwiftPMBuildSystem.swift b/Sources/SKSwiftPMWorkspace/SwiftPMBuildSystem.swift
index e669f5e68..2e056a92c 100644
--- a/Sources/SKSwiftPMWorkspace/SwiftPMBuildSystem.swift
+++ b/Sources/SKSwiftPMWorkspace/SwiftPMBuildSystem.swift
@@ -263,7 +263,7 @@ extension SwiftPMBuildSystem {
     self.fileToTarget = [AbsolutePath: SwiftBuildTarget](
       modulesGraph.allTargets.flatMap { target in
         return target.sources.paths.compactMap {
-          guard let buildTarget = buildDescription.getBuildTarget(for: target) else {
+          guard let buildTarget = buildDescription.getBuildTarget(for: target, in: modulesGraph) else {
             return nil
           }
           return (key: $0, value: buildTarget)
@@ -277,7 +277,7 @@ extension SwiftPMBuildSystem {
 
     self.sourceDirToTarget = [AbsolutePath: SwiftBuildTarget](
       modulesGraph.allTargets.compactMap { (target) -> (AbsolutePath, SwiftBuildTarget)? in
-        guard let buildTarget = buildDescription.getBuildTarget(for: target) else {
+        guard let buildTarget = buildDescription.getBuildTarget(for: target, in: modulesGraph) else {
           return nil
         }
         return (key: target.sources.root, value: buildTarget)
@@ -439,8 +439,13 @@ extension SwiftPMBuildSystem: SKCore.BuildSystem {
   }
 
   public func testFiles() -> [DocumentURI] {
-    // We should only include source files from test targets (https://github.com/apple/sourcekit-lsp/issues/1174).
-    return fileToTarget.map { DocumentURI($0.key.asURL) }
+    return fileToTarget.compactMap { (path, target) -> DocumentURI? in
+      guard target.isPartOfRootPackage else {
+        // Don't consider files from package dependencies as possible test files.
+        return nil
+      }
+      return DocumentURI(path.asURL)
+    }
   }
 
   public func addTestFilesDidChangeCallback(_ callback: @Sendable @escaping () async -> Void) async {
diff --git a/Sources/SKTestSupport/MultiFileTestProject.swift b/Sources/SKTestSupport/MultiFileTestProject.swift
index 1484c4a64..cd9b8f000 100644
--- a/Sources/SKTestSupport/MultiFileTestProject.swift
+++ b/Sources/SKTestSupport/MultiFileTestProject.swift
@@ -31,6 +31,15 @@ public struct RelativeFileLocation: Hashable, ExpressibleByStringLiteral {
     let components = value.components(separatedBy: "/")
     self.init(directories: components.dropLast(), components.last!)
   }
+
+  public func url(relativeTo: URL) -> URL {
+    var url = relativeTo
+    for directory in directories {
+      url = url.appendingPathComponent(directory)
+    }
+    url = url.appendingPathComponent(fileName)
+    return url
+  }
 }
 
 /// A test project that writes multiple files to disk and opens a `TestSourceKitLSPClient` client with a workspace
@@ -69,7 +78,7 @@ public class MultiFileTestProject {
   /// File contents can also contain `$TEST_DIR`, which gets replaced by the temporary directory.
   public init(
     files: [RelativeFileLocation: String],
-    workspaces: (URL) -> [WorkspaceFolder] = { [WorkspaceFolder(uri: DocumentURI($0))] },
+    workspaces: (URL) async throws -> [WorkspaceFolder] = { [WorkspaceFolder(uri: DocumentURI($0))] },
     usePullDiagnostics: Bool = true,
     testName: String = #function
   ) async throws {
@@ -79,11 +88,7 @@ public class MultiFileTestProject {
     var fileData: [String: FileData] = [:]
     for (fileLocation, markedText) in files {
       let markedText = markedText.replacingOccurrences(of: "$TEST_DIR", with: scratchDirectory.path)
-      var fileURL = scratchDirectory
-      for directory in fileLocation.directories {
-        fileURL = fileURL.appendingPathComponent(directory)
-      }
-      fileURL = fileURL.appendingPathComponent(fileLocation.fileName)
+      let fileURL = fileLocation.url(relativeTo: scratchDirectory)
       try FileManager.default.createDirectory(
         at: fileURL.deletingLastPathComponent(),
         withIntermediateDirectories: true
diff --git a/Sources/SKTestSupport/SwiftPMDependencyProject.swift b/Sources/SKTestSupport/SwiftPMDependencyProject.swift
new file mode 100644
index 000000000..ba97a512d
--- /dev/null
+++ b/Sources/SKTestSupport/SwiftPMDependencyProject.swift
@@ -0,0 +1,108 @@
+//===----------------------------------------------------------------------===//
+//
+// This source file is part of the Swift.org open source project
+//
+// Copyright (c) 2014 - 2024 Apple Inc. and the Swift project authors
+// Licensed under Apache License v2.0 with Runtime Library Exception
+//
+// See https://swift.org/LICENSE.txt for license information
+// See https://swift.org/CONTRIBUTORS.txt for the list of Swift project authors
+//
+//===----------------------------------------------------------------------===//
+
+import Foundation
+import ISDBTibs
+import XCTest
+
+import struct TSCBasic.AbsolutePath
+import class TSCBasic.Process
+import enum TSCBasic.ProcessEnv
+import struct TSCBasic.ProcessResult
+
+/// A SwiftPM package that gets written to disk and for which a Git repository is initialized with a commit tagged
+/// `1.0.0`. This repository can then be used as a dependency for another package, usually a `SwiftPMTestProject`.
+public class SwiftPMDependencyProject {
+  /// The directory in which the repository lives.
+  public let packageDirectory: URL
+
+  private func runCommand(_ toolName: String, _ arguments: [String], workingDirectory: URL) async throws {
+    enum Error: Swift.Error {
+      case cannotFindTool(toolName: String)
+      case processedTerminatedWithNonZeroExitCode(ProcessResult)
+    }
+    guard let toolUrl = findTool(name: toolName) else {
+      if ProcessEnv.block["SWIFTCI_USE_LOCAL_DEPS"] == nil {
+        // Never skip the test in CI, similar to what SkipUnless does.
+        throw XCTSkip("\(toolName) cannot be found")
+      }
+      throw Error.cannotFindTool(toolName: toolName)
+    }
+    print([toolUrl.path] + arguments)
+    let process = TSCBasic.Process(
+      arguments: [toolUrl.path] + arguments,
+      workingDirectory: try AbsolutePath(validating: workingDirectory.path)
+    )
+    try process.launch()
+    let processResult = try await process.waitUntilExit()
+    guard processResult.exitStatus == .terminated(code: 0) else {
+      throw Error.processedTerminatedWithNonZeroExitCode(processResult)
+    }
+  }
+
+  public static let defaultPackageManifest: String = """
+    // swift-tools-version: 5.7
+
+    import PackageDescription
+
+    let package = Package(
+      name: "MyDependency",
+      products: [.library(name: "MyDependency", targets: ["MyDependency"])],
+      targets: [.target(name: "MyDependency")]
+    )
+    """
+
+  public init(
+    files: [RelativeFileLocation: String],
+    manifest: String = defaultPackageManifest,
+    testName: String = #function
+  ) async throws {
+    packageDirectory = try testScratchDir(testName: testName).appendingPathComponent("MyDependency")
+
+    var files = files
+    files["Package.swift"] = manifest
+
+    for (fileLocation, contents) in files {
+      let fileURL = fileLocation.url(relativeTo: packageDirectory)
+      try FileManager.default.createDirectory(
+        at: fileURL.deletingLastPathComponent(),
+        withIntermediateDirectories: true
+      )
+      try contents.write(to: fileURL, atomically: true, encoding: .utf8)
+    }
+
+    try await runCommand("git", ["init"], workingDirectory: packageDirectory)
+    try await runCommand(
+      "git",
+      ["add"] + files.keys.map { $0.url(relativeTo: packageDirectory).path },
+      workingDirectory: packageDirectory
+    )
+    try await runCommand(
+      "git",
+      ["-c", "user.name=Dummy", "-c", "user.email=noreply@swift.org", "commit", "-m", "Initial commit"],
+      workingDirectory: packageDirectory
+    )
+    try await runCommand("git", ["tag", "1.0.0"], workingDirectory: packageDirectory)
+  }
+
+  deinit {
+    if cleanScratchDirectories {
+      try? FileManager.default.removeItem(at: packageDirectory)
+    }
+  }
+
+  /// Function that makes sure the project stays alive until this is called. Otherwise, the `SwiftPMDependencyProject`
+  /// might get deinitialized, which deletes the package on disk.
+  public func keepAlive() {
+    withExtendedLifetime(self) { _ in }
+  }
+}
diff --git a/Sources/SKTestSupport/SwiftPMTestProject.swift b/Sources/SKTestSupport/SwiftPMTestProject.swift
index 958a9d1b2..fa0a9dea7 100644
--- a/Sources/SKTestSupport/SwiftPMTestProject.swift
+++ b/Sources/SKTestSupport/SwiftPMTestProject.swift
@@ -38,7 +38,7 @@ public class SwiftPMTestProject: MultiFileTestProject {
   public init(
     files: [RelativeFileLocation: String],
     manifest: String = SwiftPMTestProject.defaultPackageManifest,
-    workspaces: (URL) -> [WorkspaceFolder] = { [WorkspaceFolder(uri: DocumentURI($0))] },
+    workspaces: (URL) async throws -> [WorkspaceFolder] = { [WorkspaceFolder(uri: DocumentURI($0))] },
     build: Bool = false,
     allowBuildFailure: Bool = false,
     usePullDiagnostics: Bool = true,
@@ -59,6 +59,7 @@ public class SwiftPMTestProject: MultiFileTestProject {
       filesByPath[RelativeFileLocation(directories: directories, fileLocation.fileName)] = contents
     }
     filesByPath["Package.swift"] = manifest
+
     try await super.init(
       files: filesByPath,
       workspaces: workspaces,
@@ -96,4 +97,18 @@ public class SwiftPMTestProject: MultiFileTestProject {
     environment["SWIFTPM_ENABLE_CLANG_INDEX_STORE"] = "1"
     try await Process.checkNonZeroExit(arguments: arguments, environmentBlock: environment)
   }
+
+  /// Resolve package dependencies for the package at `path`.
+  public static func resolvePackageDependencies(at path: URL) async throws {
+    guard let swift = await ToolchainRegistry.forTesting.default?.swift?.asURL else {
+      throw Error.swiftNotFound
+    }
+    let arguments = [
+      swift.path,
+      "package",
+      "resolve",
+      "--package-path", path.path,
+    ]
+    try await Process.checkNonZeroExit(arguments: arguments)
+  }
 }
diff --git a/Tests/SourceKitLSPTests/WorkspaceTestDiscoveryTests.swift b/Tests/SourceKitLSPTests/WorkspaceTestDiscoveryTests.swift
index 5763dbc21..74742e3c2 100644
--- a/Tests/SourceKitLSPTests/WorkspaceTestDiscoveryTests.swift
+++ b/Tests/SourceKitLSPTests/WorkspaceTestDiscoveryTests.swift
@@ -807,4 +807,45 @@ final class WorkspaceTestDiscoveryTests: XCTestCase {
     let testsAfterFileReAdded = try await project.testClient.send(WorkspaceTestsRequest())
     XCTAssertEqual(testsAfterFileReAdded, expectedTests)
   }
+
+  func testDontIncludeTestsFromDependentPackageInSyntacticIndex() async throws {
+    let dependencyProject = try await SwiftPMDependencyProject(files: [
+      "Sources/MyDependency/MyDependency.swift": """
+      class MySuperclass {}
+      class LooksALittleLikeTests: MySuperclass {
+        func testSomething() {}
+      }
+      """
+    ])
+    defer { dependencyProject.keepAlive() }
+
+    let project = try await SwiftPMTestProject(
+      files: [
+        "Test.swift": ""
+      ],
+      manifest: """
+        // swift-tools-version: 5.7
+
+        import PackageDescription
+
+        let package = Package(
+          name: "MyLibrary",
+          dependencies: [.package(url: "\(dependencyProject.packageDirectory)", from: "1.0.0")],
+          targets: [
+            .target(
+              name: "MyLibrary",
+              dependencies: [.product(name: "MyDependency", package: "MyDependency")]
+            )
+          ]
+        )
+        """,
+      workspaces: { scratchDirectory in
+        try await SwiftPMTestProject.resolvePackageDependencies(at: scratchDirectory)
+        return [WorkspaceFolder(uri: DocumentURI(scratchDirectory))]
+      }
+    )
+
+    let tests = try await project.testClient.send(WorkspaceTestsRequest())
+    XCTAssertEqual(tests, [])
+  }
 }