diff --git a/packages/command/bin/flutter_gen_command.dart b/packages/command/bin/flutter_gen_command.dart
index 5c39202bf..aa2f579b7 100644
--- a/packages/command/bin/flutter_gen_command.dart
+++ b/packages/command/bin/flutter_gen_command.dart
@@ -149,11 +149,6 @@ Future<void> _runSinglePackage(
 }) async {
   await FlutterGenerator(
     pubspecFile,
-    buildFile: buildFile ?? _packageLocalBuildFile(pubspecFile),
+    buildFile: buildFile,
   ).build();
 }
-
-File? _packageLocalBuildFile(File pubspecFile) {
-  final buildFile = File(p.join(pubspecFile.parent.path, 'build.yaml'));
-  return buildFile.existsSync() ? buildFile : null;
-}
diff --git a/packages/command/test/flutter_gen_command_test.dart b/packages/command/test/flutter_gen_command_test.dart
index 14b4437de..de6fb32f9 100644
--- a/packages/command/test/flutter_gen_command_test.dart
+++ b/packages/command/test/flutter_gen_command_test.dart
@@ -196,6 +196,78 @@ targets:
       isFalse,
     );
   });
+
+  for (final workspace in [false, true]) {
+    test(
+        'Execute fluttergen ignores unrelated build.yaml (workspace: $workspace)',
+        () async {
+      final workspaceDir = await _copyExampleWorkspace();
+      addTearDown(() => workspaceDir.deleteSync(recursive: true));
+      await _deleteGeneratedDirs(workspaceDir);
+
+      final galleryOneDir = Directory(
+        p.join(workspaceDir.path, 'packages', 'gallery_one'),
+      );
+      File(p.join(galleryOneDir.path, 'build.yaml')).writeAsStringSync(r'''
+targets:
+  $default:
+    builders:
+      unrelated_builder:
+        options:
+          enabled: true
+''');
+
+      final process = await TestProcess.start(
+        'dart',
+        [
+          'run',
+          p.join(Directory.current.path, 'bin', 'flutter_gen_command.dart'),
+          if (workspace) '--workspace',
+          '--config',
+          p.join(
+            workspace ? workspaceDir.path : galleryOneDir.path,
+            'pubspec.yaml',
+          ),
+        ],
+        workingDirectory: workspaceDir.path,
+      );
+
+      await process.shouldExit(0);
+      expect(await process.stderr.rest.toList(), isEmpty);
+      expect(
+        File(p.join(galleryOneDir.path, 'lib', 'gen', 'assets.gen.dart'))
+            .readAsStringSync(),
+        contains('class GalleryOneAssets'),
+      );
+    });
+  }
+
+  test('Execute fluttergen reports an explicit build file without options',
+      () async {
+    final workspaceDir = await _copyExampleWorkspace();
+    addTearDown(() => workspaceDir.deleteSync(recursive: true));
+    final buildFile = File(p.join(workspaceDir.path, 'build.yaml'))
+      ..writeAsStringSync('targets: {}\n');
+
+    final process = await TestProcess.start(
+      'dart',
+      [
+        'run',
+        p.join(Directory.current.path, 'bin', 'flutter_gen_command.dart'),
+        '--config',
+        p.join(workspaceDir.path, 'packages', 'gallery_one', 'pubspec.yaml'),
+        '--build',
+        buildFile.path,
+      ],
+      workingDirectory: workspaceDir.path,
+    );
+
+    await process.shouldExit(0);
+    expect(
+      (await process.stderr.rest.toList()).join('\n'),
+      contains('[SEVERE]'),
+    );
+  });
 }
 
 Future<Directory> _copyExampleWorkspace() async {
diff --git a/packages/core/lib/settings/config.dart b/packages/core/lib/settings/config.dart
index 7e1f9635d..039a79f0f 100644
--- a/packages/core/lib/settings/config.dart
+++ b/packages/core/lib/settings/config.dart
@@ -83,8 +83,9 @@ Config loadPubspecConfig(File pubspecFile, {File? buildFile}) {
 
   // Fallback to the build.yaml when no build file has been specified and
   // the default one has valid configurations.
-  if (buildFile == null && getBuildFileOptions(File('build.yaml')) != null) {
-    buildFile = File('build.yaml');
+  final defaultBuildFile = File(join(pubspecFile.parent.path, 'build.yaml'));
+  if (buildFile == null && getBuildFileOptions(defaultBuildFile) != null) {
+    buildFile = defaultBuildFile;
   }
 
   if (buildFile != null) {
diff --git a/packages/core/test/assets_gen_test.dart b/packages/core/test/assets_gen_test.dart
index 38ab09125..c8f821ce2 100644
--- a/packages/core/test/assets_gen_test.dart
+++ b/packages/core/test/assets_gen_test.dart
@@ -215,14 +215,26 @@ void main() {
 
     test('fallback to build.yaml if valid', () async {
       const pubspec = 'test_resources/pubspec_assets.yaml';
-      final buildFile = File('build.yaml');
-      final originalBuildContent = buildFile.readAsStringSync();
+      final buildFile = File('test_resources/build.yaml');
+      final originalBuildContent =
+          buildFile.existsSync() ? buildFile.readAsStringSync() : null;
+      addTearDown(() {
+        if (originalBuildContent == null) {
+          buildFile.deleteSync();
+        } else {
+          buildFile.writeAsStringSync(originalBuildContent);
+        }
+      });
+      final generated =
+          File('test_resources/lib/build_gen/assets_assets.gen.dart');
+      if (generated.existsSync()) {
+        generated.deleteSync();
+      }
       buildFile.writeAsStringSync(
         File('test_resources/build_assets.yaml').readAsStringSync(),
       );
-      await expectedAssetsGen(pubspec).whenComplete(() {
-        buildFile.writeAsStringSync(originalBuildContent);
-      });
+      await expectedAssetsGen(pubspec);
+      expect(generated.existsSync(), isTrue);
     });
   });
 
diff --git a/packages/core/test/config_test.dart b/packages/core/test/config_test.dart
index da7dc135a..108d6f505 100644
--- a/packages/core/test/config_test.dart
+++ b/packages/core/test/config_test.dart
@@ -232,6 +232,31 @@ sdks:
   });
 
   group('ConfigLoadInput', () {
+    test(
+        'discovers build options beside the pubspec outside the working directory',
+        () {
+      final tempDir = Directory.systemTemp.createTempSync('flutter_gen_test');
+      addTearDown(() => tempDir.deleteSync(recursive: true));
+      final tempPubspec = File('${tempDir.path}/pubspec.yaml')
+        ..writeAsStringSync('''
+name: package_build_options_test
+flutter_gen:
+  output: lib/gen/
+''');
+      File('${tempDir.path}/build.yaml').writeAsStringSync(r'''
+targets:
+  $default:
+    builders:
+      flutter_gen_runner:
+        options:
+          output: lib/build_gen/
+''');
+
+      final config = loadPubspecConfig(tempPubspec);
+
+      expect(config.pubspec.flutterGen.output, 'lib/build_gen/');
+    });
+
     test('ignores a missing explicit build file', () {
       final tempDir = Directory.systemTemp.createTempSync('flutter_gen_test');
       try {