diff --git a/fs/cifs/dir.c b/fs/cifs/dir.c
index 634cf330fe04a4c746c60b9b57c652a19f6ab905..e962e75e6f7b1e8f3d8011488f2d4c08c490a43e 100644
--- a/fs/cifs/dir.c
+++ b/fs/cifs/dir.c
@@ -236,12 +236,14 @@ cifs_create(struct inode *inode, struct dentry *direntry, int mode,
 
 			if (cifs_sb->mnt_cifs_flags & CIFS_MOUNT_SET_UID) {
 				args.uid = (__u64) current->fsuid;
-				args.gid = (__u64) current->fsgid;
+				if (inode->i_mode & S_ISGID)
+					args.gid = (__u64) inode->i_gid;
+				else
+					args.gid = (__u64) current->fsgid;
 			} else {
 				args.uid = NO_CHANGE_64;
 				args.gid = NO_CHANGE_64;
 			}
-
 			CIFSSMBUnixSetInfo(xid, pTcon, full_path, &args,
 				cifs_sb->local_nls,
 				cifs_sb->mnt_cifs_flags &
@@ -270,7 +272,12 @@ cifs_create(struct inode *inode, struct dentry *direntry, int mode,
 				    (cifs_sb->mnt_cifs_flags &
 				     CIFS_MOUNT_SET_UID)) {
 					newinode->i_uid = current->fsuid;
-					newinode->i_gid = current->fsgid;
+					if (inode->i_mode & S_ISGID)
+						newinode->i_gid =
+							inode->i_gid;
+					else
+						newinode->i_gid =
+							current->fsgid;
 				}
 			}
 		}
diff --git a/fs/cifs/inode.c b/fs/cifs/inode.c
index d952914dfc4ce4267753b95043629d105ed6d61a..6d911896d74cdb83d64c42ef4db8b431a517903e 100644
--- a/fs/cifs/inode.c
+++ b/fs/cifs/inode.c
@@ -985,7 +985,12 @@ int cifs_mkdir(struct inode *inode, struct dentry *direntry, int mode)
 		  * failed to get it from the server or was set bogus */
 		if ((direntry->d_inode) && (direntry->d_inode->i_nlink < 2))
 				direntry->d_inode->i_nlink = 2;
+
 		mode &= ~current->fs->umask;
+		/* must turn on setgid bit if parent dir has it */
+		if (inode->i_mode & S_ISGID)
+			mode |= S_ISGID;
+
 		if (pTcon->unix_ext) {
 			struct cifs_unix_set_info_args args = {
 				.mode	= mode,
@@ -996,7 +1001,10 @@ int cifs_mkdir(struct inode *inode, struct dentry *direntry, int mode)
 			};
 			if (cifs_sb->mnt_cifs_flags & CIFS_MOUNT_SET_UID) {
 				args.uid = (__u64)current->fsuid;
-				args.gid = (__u64)current->fsgid;
+				if (inode->i_mode & S_ISGID)
+					args.gid = (__u64)inode->i_gid;
+				else
+					args.gid = (__u64)current->fsgid;
 			} else {
 				args.uid = NO_CHANGE_64;
 				args.gid = NO_CHANGE_64;
@@ -1026,8 +1034,12 @@ int cifs_mkdir(struct inode *inode, struct dentry *direntry, int mode)
 				     CIFS_MOUNT_SET_UID) {
 					direntry->d_inode->i_uid =
 						current->fsuid;
-					direntry->d_inode->i_gid =
-						current->fsgid;
+					if (inode->i_mode & S_ISGID)
+						direntry->d_inode->i_gid =
+							inode->i_gid;
+					else
+						direntry->d_inode->i_gid =
+							current->fsgid;
 				}
 			}
 		}