diff --git a/extensions/git/src/repository.ts b/extensions/git/src/repository.ts
index 6018648f468dc320b685ce8a260da50f6dfd5fe0..bec7ce5ead730febda623b5d4d6481bc4cefd557 100644
--- a/extensions/git/src/repository.ts
+++ b/extensions/git/src/repository.ts
@@ -488,7 +488,10 @@ class DotGitWatcher implements IFileWatcher {
 	private transientDisposables: IDisposable[] = [];
 	private disposables: IDisposable[] = [];
 
-	constructor(private repository: Repository) {
+	constructor(
+		private repository: Repository,
+		private outputChannel: OutputChannel
+	) {
 		const rootWatcher = watch(repository.dotGit);
 		this.disposables.push(rootWatcher);
 
@@ -511,9 +514,15 @@ class DotGitWatcher implements IFileWatcher {
 		const { name, remote } = this.repository.HEAD.upstream;
 		const upstreamPath = path.join(this.repository.dotGit, 'refs', 'remotes', remote, name);
 
-		const upstreamWatcher = watch(upstreamPath);
-		this.transientDisposables.push(upstreamWatcher);
-		upstreamWatcher.event(this.emitter.fire, this.emitter, this.transientDisposables);
+		try {
+			const upstreamWatcher = watch(upstreamPath);
+			this.transientDisposables.push(upstreamWatcher);
+			upstreamWatcher.event(this.emitter.fire, this.emitter, this.transientDisposables);
+		} catch (err) {
+			if (env.logLevel <= LogLevel.Info) {
+				this.outputChannel.appendLine(`Failed to watch ref '${upstreamPath}'. Ref is most likely packed.`);
+			}
+		}
 	}
 
 	dispose() {
@@ -642,7 +651,7 @@ export class Repository implements Disposable {
 		const onWorkspaceRepositoryFileChange = filterEvent(onWorkspaceFileChange, uri => isDescendant(repository.root, uri.fsPath));
 		const onWorkspaceWorkingTreeFileChange = filterEvent(onWorkspaceRepositoryFileChange, uri => !/\/\.git($|\/)/.test(uri.path));
 
-		const dotGitFileWatcher = new DotGitWatcher(this);
+		const dotGitFileWatcher = new DotGitWatcher(this, outputChannel);
 		this.disposables.push(dotGitFileWatcher);
 
 		// FS changes should trigger `git status`: