diff --git a/django/db/migrations/loader.py b/django/db/migrations/loader.py
index 35266a7f62..bbd60a63dd 100644
--- a/django/db/migrations/loader.py
+++ b/django/db/migrations/loader.py
@@ -97,6 +97,7 @@ class MigrationLoader(object):
                         migration_names.add(import_name)
             # Load them
             south_style_migrations = False
+            django_style_migrations = False
             for migration_name in migration_names:
                 try:
                     migration_module = import_module("%s.%s" % (module_name, migration_name))
@@ -115,8 +116,10 @@ class MigrationLoader(object):
                     south_style_migrations = True
                     break
                 self.disk_migrations[app_config.label, migration_name] = migration_module.Migration(migration_name, app_config.label)
+                django_style_migrations = True
+
             if south_style_migrations:
-                if app_config.label in self.migrated_apps:
+                if django_style_migrations:
                     raise BadMigrationError(
                         "Migrated app %r contains South migrations. Make sure "
                         "all numbered South migrations are deleted prior to "
diff --git a/docs/releases/1.8.7.txt b/docs/releases/1.8.7.txt
index 9e8f37f120..78912d0f52 100644
--- a/docs/releases/1.8.7.txt
+++ b/docs/releases/1.8.7.txt
@@ -18,3 +18,6 @@ Bugfixes
 * Fixed a regression in 1.8.6 by restoring the ability to use ``Manager``
   objects for the ``queryset`` argument of ``ModelChoiceField``
   (:ticket:`25683`).
+
+* Fixed a regression in 1.8.6 that caused an application with South migrations
+  in the ``migrations`` directory to fail (:ticket:`25618`).