diff --git a/src/compiler/tsc.ts b/src/compiler/tsc.ts
index 8e08091bc77..e5b85a7391e 100644
--- a/src/compiler/tsc.ts
+++ b/src/compiler/tsc.ts
@@ -710,14 +710,16 @@ namespace ts {
         else {
             const compilerOptions = extend(options, defaultInitCompilerOptions);
             const configurations: any = {
-                compilerOptions: serializeCompilerOptions(compilerOptions),
-                exclude: ["node_modules"]
+                compilerOptions: serializeCompilerOptions(compilerOptions)
             };
 
             if (fileNames && fileNames.length) {
                 // only set the files property if we have at least one file
                 configurations.files = fileNames;
             }
+            else {
+                configurations.exclude = ["node_modules"];
+            }
 
             sys.writeFile(file, JSON.stringify(configurations, undefined, 4));
             reportDiagnostic(createCompilerDiagnostic(Diagnostics.Successfully_created_a_tsconfig_json_file), /* compilerHost */ undefined);