Index: clang/lib/Basic/VirtualFileSystem.cpp
===================================================================
--- clang/lib/Basic/VirtualFileSystem.cpp
+++ clang/lib/Basic/VirtualFileSystem.cpp
@@ -905,6 +905,62 @@
   std::error_code increment() override;
 };
 
+class CombinedFSDirIterImpl : public clang::vfs::detail::DirIterImpl {
+  FileSystem &ExtraFS;
+  std::string Path;
+  bool IsWorkingWithExtraFS;
+  directory_iterator CurrentDirIter;
+  llvm::StringSet<> SeenNames;
+
+  std::error_code incrementFS() {
+    // assert(!IsWorkingWithExtraFS && "incrementing past end");
+    if (IsWorkingWithExtraFS)
+      return {};
+    IsWorkingWithExtraFS = true;
+    std::error_code EC;
+    CurrentDirIter = (ExtraFS).dir_begin(Path, EC);
+    if (EC && EC != errc::no_such_file_or_directory)
+      return EC;
+    return {};
+  }
+
+  std::error_code incrementDirIter(bool IsFirstTime) {
+    assert((IsFirstTime || CurrentDirIter != directory_iterator()) &&
+           "incrementing past end");
+    std::error_code EC;
+    if (!IsFirstTime)
+      CurrentDirIter.increment(EC);
+    if (!EC && CurrentDirIter == directory_iterator())
+      EC = incrementFS();
+    return EC;
+  }
+
+  std::error_code incrementImpl(bool IsFirstTime) {
+    while (true) {
+      std::error_code EC = incrementDirIter(IsFirstTime);
+      if (EC || CurrentDirIter == directory_iterator()) {
+        CurrentEntry = Status();
+        return EC;
+      }
+      CurrentEntry = *CurrentDirIter;
+      StringRef Name = llvm::sys::path::filename(CurrentEntry.getName());
+      if (SeenNames.insert(Name).second)
+        return EC; // name not seen before
+    }
+    llvm_unreachable("returned above");
+  }
+
+public:
+  CombinedFSDirIterImpl(const Twine &Path, FileSystem &FS,
+                        directory_iterator DirIter, std::error_code &EC)
+      : ExtraFS(FS), Path(Path.str()), IsWorkingWithExtraFS(false),
+        CurrentDirIter(DirIter) {
+    EC = incrementImpl(true);
+  }
+
+  std::error_code increment() override { return incrementImpl(false); }
+};
+
 /// A virtual file system parsed from a YAML file.
 ///
 /// Currently, this class allows creating virtual directories and mapping
@@ -926,6 +982,7 @@
 ///   'use-external-names': <boolean, default=true>
 ///   'overlay-relative': <boolean, default=false>
 ///   'ignore-non-existent-contents': <boolean, default=true>
+///   'fallthrough': <boolean, default=true>
 ///
 /// Virtual directories are represented as
 /// \verbatim
@@ -997,6 +1054,10 @@
   /// paths in 'external-contents'. This global value is overridable on a
   /// per-file basis.
   bool IgnoreNonExistentContents = true;
+
+  /// Whether to attempt a file lookup in external file system after it wasn't
+  /// found in VFS.
+  bool IsFallthrough = true;
   /// @}
 
   /// Virtual file paths and external files could be canonicalized without "..",
@@ -1025,6 +1086,8 @@
   /// Looks up \p Path in \c Roots.
   ErrorOr<Entry *> lookupPath(const Twine &Path);
 
+  ErrorOr<Status> statusImpl(const Twine &Path);
+
   /// Parses \p Buffer, which is expected to be in YAML format and
   /// returns a virtual file system representing its contents.
   static RedirectingFileSystem *
@@ -1043,7 +1106,7 @@
     return ExternalFS->setCurrentWorkingDirectory(Path);
   }
 
-  directory_iterator dir_begin(const Twine &Dir, std::error_code &EC) override{
+  directory_iterator dir_begin_impl(const Twine &Dir, std::error_code &EC) {
     ErrorOr<Entry *> E = lookupPath(Dir);
     if (!E) {
       EC = E.getError();
@@ -1065,6 +1128,11 @@
         *this, D->contents_begin(), D->contents_end(), EC));
   }
 
+  directory_iterator dir_begin(const Twine &Dir, std::error_code &EC) override {
+    return directory_iterator(std::make_shared<CombinedFSDirIterImpl>(
+        Dir, *ExternalFS, dir_begin_impl(Dir, EC), EC));
+  }
+
   void setExternalContentsPrefixDir(StringRef PrefixDir) {
     ExternalContentsPrefixDir = PrefixDir.str();
   }
@@ -1439,6 +1507,7 @@
       KeyStatusPair("use-external-names", false),
       KeyStatusPair("overlay-relative", false),
       KeyStatusPair("ignore-non-existent-contents", false),
+      KeyStatusPair("fallthrough", false),
       KeyStatusPair("roots", true),
     };
 
@@ -1498,6 +1567,9 @@
       } else if (Key == "ignore-non-existent-contents") {
         if (!parseScalarBool(I.getValue(), FS->IgnoreNonExistentContents))
           return false;
+      } else if (Key == "fallthrough") {
+        if (!parseScalarBool(I.getValue(), FS->IsFallthrough))
+          return false;
       } else {
         llvm_unreachable("key missing from Keys");
       }
@@ -1661,13 +1733,21 @@
   }
 }
 
-ErrorOr<Status> RedirectingFileSystem::status(const Twine &Path) {
+ErrorOr<Status> RedirectingFileSystem::statusImpl(const Twine &Path) {
   ErrorOr<Entry *> Result = lookupPath(Path);
   if (!Result)
     return Result.getError();
   return status(Path, *Result);
 }
 
+ErrorOr<Status> RedirectingFileSystem::status(const Twine &Path) {
+  ErrorOr<Status> Result = statusImpl(Path);
+  if (IsFallthrough && !Result &&
+      Result.getError() == llvm::errc::no_such_file_or_directory)
+    return ExternalFS->status(Path);
+  return Result;
+}
+
 namespace {
 
 /// Provide a file wrapper with an overriden status.
@@ -1696,8 +1776,13 @@
 ErrorOr<std::unique_ptr<File>>
 RedirectingFileSystem::openFileForRead(const Twine &Path) {
   ErrorOr<Entry *> E = lookupPath(Path);
-  if (!E)
+  if (!E) {
+    if (IsFallthrough &&
+        E.getError() == llvm::errc::no_such_file_or_directory) {
+      return ExternalFS->openFileForRead(Path);
+    }
     return E.getError();
+  }
 
   auto *F = dyn_cast<RedirectingFileEntry>(*E);
   if (!F) // FIXME: errc::not_a_file?
@@ -1951,7 +2036,7 @@
   while (Current != End) {
     SmallString<128> PathStr(Dir);
     llvm::sys::path::append(PathStr, (*Current)->getName());
-    llvm::ErrorOr<vfs::Status> S = FS.status(PathStr);
+    llvm::ErrorOr<vfs::Status> S = FS.statusImpl(PathStr);
     if (S) {
       CurrentEntry = *S;
       return;
@@ -1973,7 +2058,7 @@
   while (++Current != End) {
     SmallString<128> PathStr(Dir);
     llvm::sys::path::append(PathStr, (*Current)->getName());
-    llvm::ErrorOr<vfs::Status> S = FS.status(PathStr);
+    llvm::ErrorOr<vfs::Status> S = FS.statusImpl(PathStr);
     if (!S) {
       // Skip entries which do not map to a reliable external content.
       if (FS.ignoreNonExistentContents() &&
Index: clang/lib/Frontend/CompilerInvocation.cpp
===================================================================
--- clang/lib/Frontend/CompilerInvocation.cpp
+++ clang/lib/Frontend/CompilerInvocation.cpp
@@ -3223,25 +3223,27 @@
   if (CI.getHeaderSearchOpts().VFSOverlayFiles.empty())
     return BaseFS;
 
-  IntrusiveRefCntPtr<vfs::OverlayFileSystem> Overlay(
-      new vfs::OverlayFileSystem(BaseFS));
+  IntrusiveRefCntPtr<vfs::FileSystem> Result = BaseFS;
   // earlier vfs files are on the bottom
   for (const auto &File : CI.getHeaderSearchOpts().VFSOverlayFiles) {
     llvm::ErrorOr<std::unique_ptr<llvm::MemoryBuffer>> Buffer =
-        BaseFS->getBufferForFile(File);
+        Result->getBufferForFile(File);
     if (!Buffer) {
       Diags.Report(diag::err_missing_vfs_overlay_file) << File;
       continue;
     }
 
-    IntrusiveRefCntPtr<vfs::FileSystem> FS = vfs::getVFSFromYAML(
-        std::move(Buffer.get()), /*DiagHandler*/ nullptr, File);
-    if (FS)
-      Overlay->pushOverlay(FS);
-    else
+    IntrusiveRefCntPtr<vfs::FileSystem> FS =
+        vfs::getVFSFromYAML(std::move(Buffer.get()), /*DiagHandler*/ nullptr,
+                            File, /*DiagContext*/ nullptr, Result);
+    if (!FS) {
       Diags.Report(diag::err_invalid_vfs_overlay) << File;
+      continue;
+    }
+
+    Result = FS;
   }
-  return Overlay;
+  return Result;
 }
 
 } // namespace clang
Index: clang/test/VFS/Inputs/vfsroot.yaml
===================================================================
--- /dev/null
+++ clang/test/VFS/Inputs/vfsroot.yaml
@@ -0,0 +1,34 @@
+{
+  'version': 0,
+  'ignore-non-existent-contents': false,
+  'fallthrough': false,
+  'roots': [
+    { 'name': '/tests', 'type': 'directory',
+      'contents': [
+        { 'name': 'vfsroot-include.c', 'type': 'file',
+          'external-contents': 'TEST_DIR/vfsroot-include.c'
+        },
+        { 'name': 'vfsroot-with-overlay.c', 'type': 'file',
+          'external-contents': 'TEST_DIR/vfsroot-with-overlay.c'
+        }
+      ]
+    },
+    { 'name': '/direct-vfs-root-files', 'type': 'directory',
+      'contents': [
+        { 'name': 'not_real.h', 'type': 'file',
+          'external-contents': 'TEST_DIR/Inputs/actual_header.h'
+        },
+        { 'name': 'vfsoverlay.yaml', 'type': 'file',
+          'external-contents': 'TEMP_DIR/vfsoverlay.yaml'
+        }
+      ]
+    },
+    { 'name': '/indirect-vfs-root-files', 'type': 'directory',
+      'contents': [
+        { 'name': 'actual_header.h', 'type': 'file',
+          'external-contents': 'TEST_DIR/Inputs/actual_header.h'
+        }
+      ]
+    }
+  ]
+}
Index: clang/test/VFS/vfsroot-include.c
===================================================================
--- /dev/null
+++ clang/test/VFS/vfsroot-include.c
@@ -0,0 +1,17 @@
+// REQUIRES: shell
+// RUN: rm -rf %t
+// RUN: mkdir -p %t
+// RUN: sed -e "s:TEST_DIR:%S:g" %S/Inputs/vfsroot.yaml > %t.yaml
+// RUN: not %clang_cc1 -Werror -ivfsoverlay %t.yaml -I %S/Inputs -I /direct-vfs-root-files -fsyntax-only /tests/vfsroot-include.c 2>&1 | FileCheck %s
+// The line above tests that the compiler input file is looked up through VFS.
+
+// Test successful include through the VFS.
+#include "not_real.h"
+
+// Test that a file missing from the VFS root is not found, even if it is
+// discoverable through the real file system. Fatal error should be the last
+// in the file as it hides other errors.
+#include "actual_header.h"
+// CHECK: fatal error: 'actual_header.h' file not found
+// CHECK: 1 error generated.
+// CHECK-NOT: error
Index: clang/test/VFS/vfsroot-with-overlay.c
===================================================================
--- /dev/null
+++ clang/test/VFS/vfsroot-with-overlay.c
@@ -0,0 +1,12 @@
+// REQUIRES: shell
+// RUN: rm -rf %t
+// RUN: mkdir -p %t
+// RUN: sed -e "s:TEST_DIR:%S:g" -e "s:TEMP_DIR:%t:g" %S/Inputs/vfsroot.yaml > %t.yaml
+// RUN: sed -e "s:INPUT_DIR:/indirect-vfs-root-files:g" -e "s:OUT_DIR:/overlay-dir:g" %S/Inputs/vfsoverlay.yaml > %t/vfsoverlay.yaml
+// RUN: %clang_cc1 -Werror -ivfsoverlay %t.yaml -ivfsoverlay /direct-vfs-root-files/vfsoverlay.yaml -I /overlay-dir -fsyntax-only /tests/vfsroot-with-overlay.c
+
+#include "not_real.h"
+
+void foo() {
+  bar();
+}