diff --git a/changelog/3771.bugfix.rst b/changelog/3771.bugfix.rst
new file mode 100644
index 000000000..09c953aa2
--- /dev/null
+++ b/changelog/3771.bugfix.rst
@@ -0,0 +1 @@
+Fix infinite recursion during collection if a ``pytest_ignore_collect`` returns ``False`` instead of ``None``.
diff --git a/src/_pytest/python.py b/src/_pytest/python.py
index 5b8305e77..2657bff63 100644
--- a/src/_pytest/python.py
+++ b/src/_pytest/python.py
@@ -561,7 +561,7 @@ class Package(Module):
     def _recurse(self, path):
         ihook = self.gethookproxy(path.dirpath())
         if ihook.pytest_ignore_collect(path=path, config=self.config):
-            return
+            return False
         for pat in self._norecursepatterns:
             if path.check(fnmatch=pat):
                 return False
@@ -594,9 +594,12 @@ class Package(Module):
         return path in self.session._initialpaths
 
     def collect(self):
-        path = self.fspath.dirpath()
+        this_path = self.fspath.dirpath()
         pkg_prefix = None
-        for path in path.visit(fil=lambda x: 1, rec=self._recurse, bf=True, sort=True):
+        for path in this_path.visit(rec=self._recurse, bf=True, sort=True):
+            # we will visit our own __init__.py file, in which case we skip it
+            if path.basename == "__init__.py" and path.dirpath() == this_path:
+                continue
             if pkg_prefix and pkg_prefix in path.parts():
                 continue
             for x in self._collectfile(path):
diff --git a/testing/example_scripts/collect/package_infinite_recursion/conftest.py b/testing/example_scripts/collect/package_infinite_recursion/conftest.py
new file mode 100644
index 000000000..9629fa646
--- /dev/null
+++ b/testing/example_scripts/collect/package_infinite_recursion/conftest.py
@@ -0,0 +1,2 @@
+def pytest_ignore_collect(path):
+    return False
diff --git a/testing/example_scripts/collect/package_infinite_recursion/tests/__init__.py b/testing/example_scripts/collect/package_infinite_recursion/tests/__init__.py
new file mode 100644
index 000000000..e69de29bb
diff --git a/testing/example_scripts/collect/package_infinite_recursion/tests/test_basic.py b/testing/example_scripts/collect/package_infinite_recursion/tests/test_basic.py
new file mode 100644
index 000000000..f17482385
--- /dev/null
+++ b/testing/example_scripts/collect/package_infinite_recursion/tests/test_basic.py
@@ -0,0 +1,2 @@
+def test():
+    pass
diff --git a/testing/python/collect.py b/testing/python/collect.py
index a76cecada..907b368eb 100644
--- a/testing/python/collect.py
+++ b/testing/python/collect.py
@@ -1577,3 +1577,9 @@ def test_keep_duplicates(testdir):
     )
     result = testdir.runpytest("--keep-duplicates", a.strpath, a.strpath)
     result.stdout.fnmatch_lines(["*collected 2 item*"])
+
+
+def test_package_collection_infinite_recursion(testdir):
+    testdir.copy_example("collect/package_infinite_recursion")
+    result = testdir.runpytest()
+    result.stdout.fnmatch_lines("*1 passed*")