diff --git a/builtin/fsmonitor--daemon.c b/builtin/fsmonitor--daemon.c
index 8988440b7c..1618f1aa27 100644
--- a/builtin/fsmonitor--daemon.c
+++ b/builtin/fsmonitor--daemon.c
@@ -121,6 +121,87 @@ static int handle_client(void *data,
 	return result;
 }
 
+#define FSMONITOR_COOKIE_PREFIX ".fsmonitor-daemon-"
+
+enum fsmonitor_path_type fsmonitor_classify_path_workdir_relative(
+	const char *rel)
+{
+	if (fspathncmp(rel, ".git", 4))
+		return IS_WORKDIR_PATH;
+	rel += 4;
+
+	if (!*rel)
+		return IS_DOT_GIT;
+	if (*rel != '/')
+		return IS_WORKDIR_PATH; /* e.g. .gitignore */
+	rel++;
+
+	if (!fspathncmp(rel, FSMONITOR_COOKIE_PREFIX,
+			strlen(FSMONITOR_COOKIE_PREFIX)))
+		return IS_INSIDE_DOT_GIT_WITH_COOKIE_PREFIX;
+
+	return IS_INSIDE_DOT_GIT;
+}
+
+enum fsmonitor_path_type fsmonitor_classify_path_gitdir_relative(
+	const char *rel)
+{
+	if (!fspathncmp(rel, FSMONITOR_COOKIE_PREFIX,
+			strlen(FSMONITOR_COOKIE_PREFIX)))
+		return IS_INSIDE_GITDIR_WITH_COOKIE_PREFIX;
+
+	return IS_INSIDE_GITDIR;
+}
+
+static enum fsmonitor_path_type try_classify_workdir_abs_path(
+	struct fsmonitor_daemon_state *state,
+	const char *path)
+{
+	const char *rel;
+
+	if (fspathncmp(path, state->path_worktree_watch.buf,
+		       state->path_worktree_watch.len))
+		return IS_OUTSIDE_CONE;
+
+	rel = path + state->path_worktree_watch.len;
+
+	if (!*rel)
+		return IS_WORKDIR_PATH; /* it is the root dir exactly */
+	if (*rel != '/')
+		return IS_OUTSIDE_CONE;
+	rel++;
+
+	return fsmonitor_classify_path_workdir_relative(rel);
+}
+
+enum fsmonitor_path_type fsmonitor_classify_path_absolute(
+	struct fsmonitor_daemon_state *state,
+	const char *path)
+{
+	const char *rel;
+	enum fsmonitor_path_type t;
+
+	t = try_classify_workdir_abs_path(state, path);
+	if (state->nr_paths_watching == 1)
+		return t;
+	if (t != IS_OUTSIDE_CONE)
+		return t;
+
+	if (fspathncmp(path, state->path_gitdir_watch.buf,
+		       state->path_gitdir_watch.len))
+		return IS_OUTSIDE_CONE;
+
+	rel = path + state->path_gitdir_watch.len;
+
+	if (!*rel)
+		return IS_GITDIR; /* it is the <gitdir> exactly */
+	if (*rel != '/')
+		return IS_OUTSIDE_CONE;
+	rel++;
+
+	return fsmonitor_classify_path_gitdir_relative(rel);
+}
+
 static void *fsm_listen__thread_proc(void *_state)
 {
 	struct fsmonitor_daemon_state *state = _state;
diff --git a/fsmonitor--daemon.h b/fsmonitor--daemon.h
index 3009c1a83d..7bbb3a27a1 100644
--- a/fsmonitor--daemon.h
+++ b/fsmonitor--daemon.h
@@ -30,5 +30,66 @@ struct fsmonitor_daemon_state {
 	struct ipc_server_data *ipc_server_data;
 };
 
+/*
+ * Pathname classifications.
+ *
+ * The daemon classifies the pathnames that it receives from file
+ * system notification events into the following categories and uses
+ * that to decide whether clients are told about them.  (And to watch
+ * for file system synchronization events.)
+ *
+ * The client should only care about paths within the working
+ * directory proper (inside the working directory and not ".git" nor
+ * inside of ".git/").  That is, the client has read the index and is
+ * asking for a list of any paths in the working directory that have
+ * been modified since the last token.  The client does not care about
+ * file system changes within the .git directory (such as new loose
+ * objects or packfiles).  So the client will only receive paths that
+ * are classified as IS_WORKDIR_PATH.
+ *
+ * The daemon uses the IS_DOT_GIT and IS_GITDIR internally to mean the
+ * exact ".git" directory or GITDIR.  If the daemon receives a delete
+ * event for either of these directories, it will automatically
+ * shutdown, for example.
+ *
+ * Note that the daemon DOES NOT explicitly watch nor special case the
+ * ".git/index" file.  The daemon does not read the index and does not
+ * have any internal index-relative state.  The daemon only collects
+ * the set of modified paths within the working directory.
+ */
+enum fsmonitor_path_type {
+	IS_WORKDIR_PATH = 0,
+
+	IS_DOT_GIT,
+	IS_INSIDE_DOT_GIT,
+	IS_INSIDE_DOT_GIT_WITH_COOKIE_PREFIX,
+
+	IS_GITDIR,
+	IS_INSIDE_GITDIR,
+	IS_INSIDE_GITDIR_WITH_COOKIE_PREFIX,
+
+	IS_OUTSIDE_CONE,
+};
+
+/*
+ * Classify a pathname relative to the root of the working directory.
+ */
+enum fsmonitor_path_type fsmonitor_classify_path_workdir_relative(
+	const char *relative_path);
+
+/*
+ * Classify a pathname relative to a <gitdir> that is external to the
+ * worktree directory.
+ */
+enum fsmonitor_path_type fsmonitor_classify_path_gitdir_relative(
+	const char *relative_path);
+
+/*
+ * Classify an absolute pathname received from a filesystem event.
+ */
+enum fsmonitor_path_type fsmonitor_classify_path_absolute(
+	struct fsmonitor_daemon_state *state,
+	const char *path);
+
 #endif /* HAVE_FSMONITOR_DAEMON_BACKEND */
 #endif /* FSMONITOR_DAEMON_H */