diff --git a/CHANGELOG.rst b/CHANGELOG.rst
index 847d27c51..6ad73d0c2 100644
--- a/CHANGELOG.rst
+++ b/CHANGELOG.rst
@@ -9,13 +9,17 @@
   expected warnings and the list of caught warnings is added to the
   error message. Thanks `@lesteve`_ for the PR.
 
-*
+* Specifying tests with colons like ``test_foo.py::test_bar`` for tests in
+  subdirectories with ini configuration files now uses the correct ini file
+  (`#2148`_).  Thanks `@pelme`_.
 
 *
 
 .. _@lesteve: https://github.com/lesteve
+.. _@pelme: https://github.com/pelme
 
 .. _#2150: https://github.com/pytest-dev/pytest/issues/2150
+.. _#2148: https://github.com/pytest-dev/pytest/issues/2148
 
 
 3.0.5 (2016-12-05)
diff --git a/_pytest/config.py b/_pytest/config.py
index fe386ed0b..55326447e 100644
--- a/_pytest/config.py
+++ b/_pytest/config.py
@@ -1228,25 +1228,20 @@ def getcfg(args, warnfunc=None):
     return None, None, None
 
 
-def get_common_ancestor(args):
-    # args are what we get after early command line parsing (usually
-    # strings, but can be py.path.local objects as well)
+def get_common_ancestor(paths):
     common_ancestor = None
-    for arg in args:
-        if str(arg)[0] == "-":
-            continue
-        p = py.path.local(arg)
-        if not p.exists():
+    for path in paths:
+        if not path.exists():
             continue
         if common_ancestor is None:
-            common_ancestor = p
+            common_ancestor = path
         else:
-            if p.relto(common_ancestor) or p == common_ancestor:
+            if path.relto(common_ancestor) or path == common_ancestor:
                 continue
-            elif common_ancestor.relto(p):
-                common_ancestor = p
+            elif common_ancestor.relto(path):
+                common_ancestor = path
             else:
-                shared = p.common(common_ancestor)
+                shared = path.common(common_ancestor)
                 if shared is not None:
                     common_ancestor = shared
     if common_ancestor is None:
@@ -1257,9 +1252,29 @@ def get_common_ancestor(args):
 
 
 def get_dirs_from_args(args):
-    return [d for d in (py.path.local(x) for x in args
-                        if not str(x).startswith("-"))
-            if d.exists()]
+    def is_option(x):
+        return str(x).startswith('-')
+
+    def get_file_part_from_node_id(x):
+        return str(x).split('::')[0]
+
+    def get_dir_from_path(path):
+        if path.isdir():
+            return path
+        return py.path.local(path.dirname)
+
+    # These look like paths but may not exist
+    possible_paths = (
+        py.path.local(get_file_part_from_node_id(arg))
+        for arg in args
+        if not is_option(arg)
+    )
+
+    return [
+        get_dir_from_path(path)
+        for path in possible_paths
+        if path.exists()
+    ]
 
 
 def determine_setup(inifile, args, warnfunc=None):
diff --git a/testing/test_config.py b/testing/test_config.py
index 21ceab1e2..6bc867737 100644
--- a/testing/test_config.py
+++ b/testing/test_config.py
@@ -527,6 +527,29 @@ def test_toolongargs_issue224(testdir):
     result = testdir.runpytest("-m", "hello" * 500)
     assert result.ret == EXIT_NOTESTSCOLLECTED
 
+def test_config_in_subdirectory_colon_command_line_issue2148(testdir):
+    conftest_source = '''
+        def pytest_addoption(parser):
+            parser.addini('foo', 'foo')
+    '''
+
+    testdir.makefile('.ini', **{
+        'pytest': '[pytest]\nfoo = root',
+        'subdir/pytest': '[pytest]\nfoo = subdir',
+    })
+
+    testdir.makepyfile(**{
+        'conftest': conftest_source,
+        'subdir/conftest': conftest_source,
+        'subdir/test_foo': '''
+            def test_foo(pytestconfig):
+                assert pytestconfig.getini('foo') == 'subdir'
+        '''})
+
+    result = testdir.runpytest('subdir/test_foo.py::test_foo')
+    assert result.ret == 0
+
+
 def test_notify_exception(testdir, capfd):
     config = testdir.parseconfig()
     excinfo = pytest.raises(ValueError, "raise ValueError(1)")