diff --git a/src/WebCompiler/Config/Config.cs b/src/WebCompiler/Config/Config.cs
index c2465e23..096dafd5 100644
--- a/src/WebCompiler/Config/Config.cs
+++ b/src/WebCompiler/Config/Config.cs
@@ -105,13 +105,21 @@ private bool HasDependenciesNewerThanOutput(FileInfo input, FileInfo output)
             return false;
         }
 
-        private bool CheckForNewerDependenciesRecursively(string key, Dictionary<string, Dependencies> dependencies, FileInfo output)
+        private bool CheckForNewerDependenciesRecursively(string key, Dictionary<string, Dependencies> dependencies, FileInfo output, HashSet<string> checkedDependencies = null)
         {
+            if (checkedDependencies == null)
+                checkedDependencies = new HashSet<string>();
+
+            checkedDependencies.Add(key);
+
             if (!dependencies.ContainsKey(key))
                 return false;
 
             foreach (var file in dependencies[key].DependentOn.ToArray())
             {
+                if (checkedDependencies.Contains(file))
+                    continue;
+
                 var fileInfo = new FileInfo(file);
 
                 if (!fileInfo.Exists)
@@ -120,7 +128,7 @@ private bool CheckForNewerDependenciesRecursively(string key, Dictionary<string,
                 if (fileInfo.LastWriteTimeUtc > output.LastWriteTimeUtc)
                     return true;
 
-                if (CheckForNewerDependenciesRecursively(file, dependencies, output))
+                if (CheckForNewerDependenciesRecursively(file, dependencies, output, checkedDependencies))
                     return true;
             }
 
diff --git a/src/WebCompilerTest/Compile/LessTest.cs b/src/WebCompilerTest/Compile/LessTest.cs
index 1b2858f3..19ad9bc5 100644
--- a/src/WebCompilerTest/Compile/LessTest.cs
+++ b/src/WebCompilerTest/Compile/LessTest.cs
@@ -1,4 +1,5 @@
-using System.IO;
+using System;
+using System.IO;
 using System.Linq;
 using Microsoft.VisualStudio.TestTools.UnitTesting;
 using WebCompiler;
@@ -25,6 +26,8 @@ public void Cleanup()
             File.Delete("../../artifacts/less/error.css");
             File.Delete("../../artifacts/less/relative.css");
             File.Delete("../../artifacts/less/relative.min.css");
+            File.Delete("../../artifacts/less/circrefa.css");
+            File.Delete("../../artifacts/less/circrefa.min.css");
         }
 
         [TestMethod, TestCategory("LESS")]
@@ -92,6 +95,19 @@ public void OtherExtensionTypeSourceFileChangedTest()
         }
 
         [TestMethod, TestCategory("LESS")]
+        public void CompileCircularReference()
+        {
+            // Set the last write time and create outputs in a way that Config.CheckForNewerDependenciesRecursively will be called
+            File.SetLastWriteTimeUtc("../../artifacts/less/circrefa.less", DateTime.UtcNow);
+            File.SetLastWriteTimeUtc("../../artifacts/less/circrefb.less", DateTime.UtcNow);
+            File.WriteAllText("../../artifacts/less/circrefa.css", string.Empty);
+            File.WriteAllText("../../artifacts/less/circrefa.min.css", string.Empty);
+
+            // Since the outputs were generated after the inputs, no compilation should have occurred
+            var result = _processor.Process("../../artifacts/lessconfigCircRef.json");
+            Assert.AreEqual(0, result.Count<CompilerResult>());
+        }
+
         public void CompileLessLegacyStrictMath()
         {
             var result = _processor.Process("../../artifacts/lessconfigLegacyStrictMath.json");
diff --git a/src/WebCompilerTest/WebCompilerTest.csproj b/src/WebCompilerTest/WebCompilerTest.csproj
index 4a1a90b4..1eb9eb54 100644
--- a/src/WebCompilerTest/WebCompilerTest.csproj
+++ b/src/WebCompilerTest/WebCompilerTest.csproj
@@ -86,6 +86,9 @@
     <None Include="artifacts\handlebars\test.hbs" />
     <None Include="artifacts\handlebars\error.hbs" />
     <None Include="artifacts\handlebars\_partial.hbs" />
+    <None Include="artifacts\lessconfigCircRef.json" />
+    <None Include="artifacts\less\circrefa.less" />
+    <None Include="artifacts\less\circrefb.less" />
     <None Include="artifacts\lessconfigLegacyStrictMath.json" />
     <None Include="artifacts\scss\sub\foo.scss" />
     <None Include="artifacts\stylusconfig.json" />
diff --git a/src/WebCompilerTest/artifacts/less/circrefa.less b/src/WebCompilerTest/artifacts/less/circrefa.less
new file mode 100644
index 00000000..d6552e0f
--- /dev/null
+++ b/src/WebCompilerTest/artifacts/less/circrefa.less
@@ -0,0 +1,3 @@
+@import "circrefb.less";
+
+@primary-color: #f00;
diff --git a/src/WebCompilerTest/artifacts/less/circrefb.less b/src/WebCompilerTest/artifacts/less/circrefb.less
new file mode 100644
index 00000000..b423691b
--- /dev/null
+++ b/src/WebCompilerTest/artifacts/less/circrefb.less
@@ -0,0 +1,5 @@
+@import (reference) "circrefa.less";
+
+.btn {
+    background-color: @primary-color;
+}
diff --git a/src/WebCompilerTest/artifacts/lessconfigCircRef.json b/src/WebCompilerTest/artifacts/lessconfigCircRef.json
new file mode 100644
index 00000000..fb13264c
--- /dev/null
+++ b/src/WebCompilerTest/artifacts/lessconfigCircRef.json
@@ -0,0 +1,10 @@
+[
+  {
+    "outputFile": "less/circrefa.css",
+    "inputFile": "less/circrefa.less",
+    "includeInProject": true,
+    "options": {
+      "relativeUrls": true
+    }
+  }
+]
\ No newline at end of file