diff --git a/pkgs/racket-doc/scribblings/raco/api.scrbl b/pkgs/racket-doc/scribblings/raco/api.scrbl
index d859f4000c..91a6bf0424 100644
--- a/pkgs/racket-doc/scribblings/raco/api.scrbl
+++ b/pkgs/racket-doc/scribblings/raco/api.scrbl
@@ -91,9 +91,10 @@ compiled, as are all such files within subdirectories; the set of such suffixes
 is extensible globally as described in @racket[get-module-suffixes], and
 @racket[compile-collection-zos] recognizes suffixes from the @racket['libs] group. However,
 any file or directory whose path starts with @racket[skip-path] or an element of @racket[skip-paths] is
-skipped. (``Starts with'' means that the simplified path @racket[_p]'s
-byte-string form after @racket[(simplify-path _p #f)]starts with the
-byte-string form of @racket[(simplify-path skip-path #f)].)
+skipped. (``Starts with'' means that the simplified complete path @racket[_p]'s
+byte-string form after @racket[(simplify-path _p #f)] starts with the
+byte-string form of @racket[(simplify-path skip-path #f)]; not that each
+@racket[skip-path] should normally be a complete path.)
 
 The collection compiler reads the collection's @filepath{info.rkt} file
 (see @secref["info.rkt"]) to obtain further instructions for compiling the
@@ -139,7 +140,8 @@ collection.  The following fields are used:
 
 ]
 
-@history[#:changed "6.3" @elem{Added support for @racket[compile-include-files].}]}
+@history[#:changed "6.3" @elem{Added support for @racket[compile-include-files].}
+         #:changed "7.8.0.8" @elem{Changed ``starts with'' for @racket[skip-path] to include an exact match.}]}
 
 
 @defproc[(compile-directory-zos [path path-string?]
@@ -156,7 +158,13 @@ collection.  The following fields are used:
 Like @racket[compile-collection-zos], but compiles the given directory
 rather than a collection. The @racket[info] function behaves like the
 result of @racket[get-info] to supply @filepath{info.rkt} fields,
-instead of using an @filepath{info.rkt} file (if any) in the directory.}
+instead of using an @filepath{info.rkt} file (if any) in the directory.
+
+@history[#:changed "7.8.0.8" @elem{Changed @racket[info] handling to use @racket[info]
+                                   for @racket['compile-omit-paths], ignoring
+                                   any @filepath{info.rkt} files in parent and
+                                   child directories.}]}
+
 
 @; ----------------------------------------------------------------------
 
diff --git a/racket/collects/compiler/compiler.rkt b/racket/collects/compiler/compiler.rkt
index b7de0740f1..1c02ef827a 100644
--- a/racket/collects/compiler/compiler.rkt
+++ b/racket/collects/compiler/compiler.rkt
@@ -99,7 +99,14 @@
                                      #:skip-paths orig-skip-paths
                                      #:skip-doc-sources? skip-docs?)
     (define info* (or info (lambda (key mk-default) (mk-default))))
-    (define omit-paths (omitted-paths dir c-get-info/full omit-root))
+    (define omit-paths (omitted-paths dir
+                                      (if info
+                                          (let ([dir (path->complete-path dir)])
+                                            (lambda (for-dir)
+                                              (and (equal? dir for-dir)
+                                                   info)))
+                                          c-get-info/full)
+                                      omit-root))
     (define skip-paths (for/list ([p (in-list (if orig-skip-path
                                                   (cons orig-skip-path orig-skip-paths)
                                                   orig-skip-paths))])
@@ -122,7 +129,7 @@
                                                 [b (path->bytes simp-path)])
                                            (for/or ([skip-path (in-list skip-paths)])
                                              (let ([len (bytes-length skip-path)])
-                                               (and ((bytes-length b) . > . len)
+                                               (and ((bytes-length b) . >= . len)
                                                     (bytes=? (subbytes b 0 len) skip-path)
                                                     (let-values ([(base name dir?) (split-path simp-path)])
                                                       (or (and (path? base)