diff --git a/src/ng/directive/ngIf.js b/src/ng/directive/ngIf.js
index a31015b2c492..1bf6106aa632 100644
--- a/src/ng/directive/ngIf.js
+++ b/src/ng/directive/ngIf.js
@@ -89,8 +89,8 @@ var ngIfDirective = ['$animate', function($animate) {
 
           if (toBoolean(value)) {
             if (!childScope) {
-              childScope = $scope.$new();
-              $transclude(childScope, function (clone) {
+              $transclude(function (clone, newScope) {
+                childScope = newScope;
                 clone[clone.length++] = document.createComment(' end ngIf: ' + $attr.ngIf + ' ');
                 // Note: We only need the first/last node of the cloned nodes.
                 // However, we need to keep the reference to the jqlite wrapper as it might be changed later
diff --git a/test/ng/directive/ngIfSpec.js b/test/ng/directive/ngIfSpec.js
index 65c6733ee202..dd24f726dcfe 100755
--- a/test/ng/directive/ngIfSpec.js
+++ b/test/ng/directive/ngIfSpec.js
@@ -199,6 +199,25 @@ describe('ngIf and transcludes', function() {
       dealoc(element);
     });
   });
+
+
+  it('should use the correct transcluded scope', function() {
+    module(function($compileProvider) {
+      $compileProvider.directive('iso', valueFn({
+        restrict: 'E',
+        transclude: true,
+        template: '<div ng-if="true"><div ng-transclude></div></div>',
+        scope: {}
+      }));
+    });
+    inject(function($compile, $rootScope) {
+      $rootScope.val = 'transcluded content';
+      var element = $compile('<iso><span ng-bind="val"></span></iso>')($rootScope);
+      $rootScope.$digest();
+      expect(trim(element.text())).toEqual('transcluded content');
+      dealoc(element);
+    });
+  });
 });
 
 describe('ngIf animations', function () {