diff --git a/doc/changes/8518.md b/doc/changes/8518.md
new file mode 100644
index 00000000000..42978c2b9ff
--- /dev/null
+++ b/doc/changes/8518.md
@@ -0,0 +1,2 @@
+- Ignore internal promote rules when `--ignore-promoted-rules` is set (#8518,
+  fix #8417, @rgrinberg)
diff --git a/otherlibs/dune-site/test/run.t b/otherlibs/dune-site/test/run.t
index f6331b25e00..c6377327730 100644
--- a/otherlibs/dune-site/test/run.t
+++ b/otherlibs/dune-site/test/run.t
@@ -170,6 +170,7 @@ Test with an opam like installation
     ["dune" "install" "-p" name "--create-install-files" name]
   ]
 
+  $ dune build b/b.opam c/c.opam d/d.opam
   $ dune build -p a --promote-install-files=false @install
 
   $ test -e a/a.install
diff --git a/otherlibs/dune-site/test/run_2_9.t b/otherlibs/dune-site/test/run_2_9.t
index 7f46b3eb2f6..36b2a011244 100644
--- a/otherlibs/dune-site/test/run_2_9.t
+++ b/otherlibs/dune-site/test/run_2_9.t
@@ -158,6 +158,7 @@ Test with an opam like installation
     ["dune" "install" "-p" name "--create-install-files" name]
   ]
 
+  $ dune build b/b.opam c/c.opam d/d.opam
   $ dune build -p a --promote-install-files="false" @install
 
   $ test -e a/a.install
diff --git a/src/dune_rules/dune_file.ml b/src/dune_rules/dune_file.ml
index 0ccce3d676a..33e279042eb 100644
--- a/src/dune_rules/dune_file.ml
+++ b/src/dune_rules/dune_file.ml
@@ -2463,21 +2463,12 @@ type t =
   ; stanzas : Stanzas.t
   }
 
-let is_promoted_rule =
-  let is_promoted_mode version = function
-    | Rule.Mode.Promote { only = None; lifetime; _ } ->
-      if version >= (3, 5)
-      then (
-        match lifetime with
-        | Unlimited -> true
-        | Until_clean -> false)
-      else true
-    | _ -> false
-  in
-  fun version rule ->
-    match rule with
-    | Rule { mode; _ } | Menhir_stanza.T { mode; _ } -> is_promoted_mode version mode
-    | _ -> false
+let is_promoted_rule version rule =
+  match rule with
+  | Rule { mode; _ } | Menhir_stanza.T { mode; _ } ->
+    let until_clean = if version >= (3, 5) then `Keep else `Ignore in
+    Rule_mode_decoder.is_ignored mode ~until_clean
+  | _ -> false
 ;;
 
 let parse sexps ~dir ~file ~project =
diff --git a/src/dune_rules/rule_mode_decoder.ml b/src/dune_rules/rule_mode_decoder.ml
index d741edfe771..f4ca2cddfc9 100644
--- a/src/dune_rules/rule_mode_decoder.ml
+++ b/src/dune_rules/rule_mode_decoder.ml
@@ -99,3 +99,15 @@ end
 
 let decode = sum mode_decoders
 let field = field "mode" decode ~default:Rule.Mode.Standard
+
+let is_ignored (mode : Rule.Mode.t) ~until_clean =
+  !Clflags.ignore_promoted_rules
+  &&
+  match mode with
+  | Promote { only = None; lifetime = Unlimited; _ } -> true
+  | Promote { only = None; lifetime = Until_clean; _ } ->
+    (match until_clean with
+     | `Ignore -> true
+     | `Keep -> false)
+  | _ -> false
+;;
diff --git a/src/dune_rules/rule_mode_decoder.mli b/src/dune_rules/rule_mode_decoder.mli
index 49068933460..03504b797fd 100644
--- a/src/dune_rules/rule_mode_decoder.mli
+++ b/src/dune_rules/rule_mode_decoder.mli
@@ -15,3 +15,11 @@ end
 
 val decode : Rule.Mode.t Dune_lang.Decoder.t
 val field : Rule.Mode.t Dune_lang.Decoder.fields_parser
+
+(** [is_ignored mode ~until_clean] will return if a rule with [mode] should be
+    ignored whenever [--ignored-promoted-rules] is set.
+
+    [until_clean] is used to set if [(promote (until-clean))] is ignored as
+    considered by this function. Old versions of dune would incorrectly ignore
+    this, so we need to maintain the old behavior for now. *)
+val is_ignored : Rule.Mode.t -> until_clean:[ `Ignore | `Keep ] -> bool
diff --git a/src/dune_rules/simple_rules.ml b/src/dune_rules/simple_rules.ml
index 57865850d66..c640727c3d1 100644
--- a/src/dune_rules/simple_rules.ml
+++ b/src/dune_rules/simple_rules.ml
@@ -134,9 +134,7 @@ let user_rule sctx ?extra_bindings ~dir ~expander (rule : Rule.t) =
       else action
     in
     (match rule_kind ~rule ~action with
-     | No_alias ->
-       let+ targets = add_user_rule sctx ~dir ~rule ~action ~expander in
-       Some targets
+     | No_alias -> add_user_rule sctx ~dir ~rule ~action ~expander
      | Aliases_with_targets (aliases, alias_target) ->
        let* () =
          let aliases = List.map ~f:(Alias.make ~dir) aliases in
@@ -145,8 +143,7 @@ let user_rule sctx ?extra_bindings ~dir ~expander (rule : Rule.t) =
              alias
              (Action_builder.path (Path.build alias_target)))
        in
-       let+ targets = add_user_rule sctx ~dir ~rule ~action ~expander in
-       Some targets
+       add_user_rule sctx ~dir ~rule ~action ~expander
      | Aliases_only aliases ->
        let aliases = List.map ~f:(Alias.make ~dir) aliases in
        let* action = interpret_and_add_locks ~expander rule.locks action.build in
diff --git a/src/dune_rules/super_context.ml b/src/dune_rules/super_context.ml
index 402f6ab955b..716d0143ced 100644
--- a/src/dune_rules/super_context.ml
+++ b/src/dune_rules/super_context.ml
@@ -255,24 +255,31 @@ let extend_action t ~dir build =
 ;;
 
 let make_rule t ?mode ?loc ~dir { Action_builder.With_targets.build; targets } =
-  let build = extend_action t build ~dir in
-  Rule.make
-    ?mode
-    ~info:(Rule.Info.of_loc_opt loc)
-    ~context:(Some (Context.build_context (Env_tree.context t)))
-    ~targets
-    build
+  match mode with
+  | Some mode when Rule_mode_decoder.is_ignored mode ~until_clean:`Keep -> None
+  | _ ->
+    let build = extend_action t build ~dir in
+    Some
+      (Rule.make
+         ?mode
+         ~info:(Rule.Info.of_loc_opt loc)
+         ~context:(Some (Context.build_context (Env_tree.context t)))
+         ~targets
+         build)
 ;;
 
 let add_rule t ?mode ?loc ~dir build =
-  let rule = make_rule t ?mode ?loc ~dir build in
-  Rules.Produce.rule rule
+  match make_rule t ?mode ?loc ~dir build with
+  | None -> Memo.return ()
+  | Some rule -> Rules.Produce.rule rule
 ;;
 
 let add_rule_get_targets t ?mode ?loc ~dir build =
-  let rule = make_rule t ?mode ?loc ~dir build in
-  let+ () = Rules.Produce.rule rule in
-  rule.targets
+  match make_rule t ?mode ?loc ~dir build with
+  | None -> Memo.return None
+  | Some rule ->
+    let+ () = Rules.Produce.rule rule in
+    Some rule.targets
 ;;
 
 let add_rules t ?loc ~dir builds = Memo.parallel_iter builds ~f:(add_rule ?loc t ~dir)
diff --git a/src/dune_rules/super_context.mli b/src/dune_rules/super_context.mli
index c54b780438a..cdc5fc30258 100644
--- a/src/dune_rules/super_context.mli
+++ b/src/dune_rules/super_context.mli
@@ -69,7 +69,7 @@ val add_rule_get_targets
   -> ?loc:Loc.t
   -> dir:Path.Build.t
   -> Action.Full.t Action_builder.With_targets.t
-  -> Targets.Validated.t Memo.t
+  -> Targets.Validated.t option Memo.t
 
 val add_rules
   :  t
diff --git a/test/blackbox-tests/test-cases/ignore-promoted-rules-internal-rules.t b/test/blackbox-tests/test-cases/ignore-promoted-internal-rules.t
similarity index 96%
rename from test/blackbox-tests/test-cases/ignore-promoted-rules-internal-rules.t
rename to test/blackbox-tests/test-cases/ignore-promoted-internal-rules.t
index 405ec20ab2a..19677fb3710 100644
--- a/test/blackbox-tests/test-cases/ignore-promoted-rules-internal-rules.t
+++ b/test/blackbox-tests/test-cases/ignore-promoted-internal-rules.t
@@ -19,4 +19,4 @@ This should not modify the file now
 
   $ dune build --ignore-promoted-rules foo.opam
   $ grep extra foo.opam
-  [1]
+  foobar_extra