diff --git a/spec/tree-sitter-language-mode-spec.js b/spec/tree-sitter-language-mode-spec.js
index 0eeeb8b93..fe9ec239b 100644
--- a/spec/tree-sitter-language-mode-spec.js
+++ b/spec/tree-sitter-language-mode-spec.js
@@ -336,6 +336,20 @@ describe('TreeSitterLanguageMode', () => {
         #ifndef FOO_H_…
         #endif
       `)
+
+      editor.foldAllAtIndentLevel(1)
+      expect(getDisplayText(editor)).toBe(dedent `
+        #ifndef FOO_H_
+        #define FOO_H_
+
+        #ifdef _WIN32…
+        #elif defined MACOS…
+        #else…
+
+        #endif
+
+        #endif
+      `)
     })
 
     describe('when folding a node that ends with a line break', () => {
diff --git a/src/text-editor.js b/src/text-editor.js
index e24476b2d..08d07aa71 100644
--- a/src/text-editor.js
+++ b/src/text-editor.js
@@ -3891,7 +3891,7 @@ class TextEditor {
 
   // Extended: Fold all foldable lines at the given indent level.
   //
-  // * `level` A {Number}.
+  // * `level` A {Number} starting at 0.
   foldAllAtIndentLevel (level) {
     const languageMode = this.buffer.getLanguageMode()
     const foldableRanges = (
diff --git a/src/tree-sitter-language-mode.js b/src/tree-sitter-language-mode.js
index a76043638..6eec047c3 100644
--- a/src/tree-sitter-language-mode.js
+++ b/src/tree-sitter-language-mode.js
@@ -138,10 +138,7 @@ class TreeSitterLanguageMode {
     let stack = [{node: this.document.rootNode, level: 0}]
     while (stack.length > 0) {
       const {node, level} = stack.pop()
-      const startRow = node.startPosition.row
-      const endRow = node.endPosition.row
 
-      let childLevel = level
       const range = this.getFoldableRangeForNode(node)
       if (range) {
         if (goalLevel == null || level === goalLevel) {
@@ -155,18 +152,23 @@ class TreeSitterLanguageMode {
           }
           if (!updatedExistingRange) result.push(range)
         }
-        childLevel++
       }
 
+      const parentStartRow = node.startPosition.row
+      const parentEndRow = node.endPosition.row
       for (let children = node.namedChildren, i = 0, {length} = children; i < length; i++) {
         const child = children[i]
-        const childStartRow = child.startPosition.row
-        const childEndRow = child.endPosition.row
-        if (childEndRow > childStartRow) {
-          if (childStartRow === startRow && childEndRow === endRow) {
+        const {startPosition: childStart, endPosition: childEnd} = child
+        if (childEnd.row > childStart.row) {
+          if (childStart.row === parentStartRow && childEnd.row === parentEndRow) {
             stack.push({node: child, level: level})
-          } else if (childLevel <= goalLevel || goalLevel == null) {
-            stack.push({node: child, level: childLevel})
+          } else {
+            const childLevel = range.containsPoint(childStart) && range.containsPoint(childEnd)
+              ? level + 1
+              : level
+            if (childLevel <= goalLevel || goalLevel == null) {
+              stack.push({node: child, level: childLevel})
+            }
           }
         }
       }