diff --git a/app/controllers/projects/blob_controller.rb b/app/controllers/projects/blob_controller.rb
index 92d26a13da9..fb2cfdedd9b 100644
--- a/app/controllers/projects/blob_controller.rb
+++ b/app/controllers/projects/blob_controller.rb
@@ -83,7 +83,7 @@ class Projects::BlobController < Projects::ApplicationController
 
   def destroy
     create_commit(Files::DeleteService, success_notice: "The file has been successfully deleted.",
-                                        success_path: -> { project_tree_path(@project, @branch_name) },
+                                        success_path: -> { after_delete_path },
                                         failure_view: :show,
                                         failure_path: project_blob_path(@project, @id))
   end
@@ -191,6 +191,15 @@ class Projects::BlobController < Projects::ApplicationController
   end
   # rubocop: enable CodeReuse/ActiveRecord
 
+  def after_delete_path
+    branch = BranchesFinder.new(@repository, search: @ref).execute.first
+    if @repository.tree(branch.target, tree_path).entries.empty?
+      project_tree_path(@project, @ref)
+    else
+      project_tree_path(@project, File.join(@ref, tree_path))
+    end
+  end
+
   def editor_variables
     @branch_name = params[:branch_name]
 
@@ -255,9 +264,6 @@ class Projects::BlobController < Projects::ApplicationController
 
   def show_json
     set_last_commit_sha
-    path_segments = @path.split('/')
-    path_segments.pop
-    tree_path = path_segments.join('/')
 
     json = {
       id: @blob.id,
@@ -283,4 +289,8 @@ class Projects::BlobController < Projects::ApplicationController
 
     render json: json
   end
+
+  def tree_path
+    @path.rpartition('/').first
+  end
 end
diff --git a/changelogs/unreleased/37727-fix-file-delete-redirect.yml b/changelogs/unreleased/37727-fix-file-delete-redirect.yml
new file mode 100644
index 00000000000..3fc3965f1f0
--- /dev/null
+++ b/changelogs/unreleased/37727-fix-file-delete-redirect.yml
@@ -0,0 +1,6 @@
+---
+title: On deletion of a file in sub directory in web IDE redirect to the sub directory
+  instead of project root
+merge_request: 21465
+author: George Thomas @thegeorgeous
+type: changed
diff --git a/spec/controllers/projects/blob_controller_spec.rb b/spec/controllers/projects/blob_controller_spec.rb
index 32cd7c6e70a..28f7e4634a5 100644
--- a/spec/controllers/projects/blob_controller_spec.rb
+++ b/spec/controllers/projects/blob_controller_spec.rb
@@ -343,4 +343,76 @@ describe Projects::BlobController do
       end
     end
   end
+
+  describe 'DELETE destroy' do
+    let(:user) { create(:user) }
+    let(:project_root_path) { project_tree_path(project, 'master') }
+
+    before do
+      project.add_maintainer(user)
+
+      sign_in(user)
+    end
+
+    context 'for a file in a subdirectory' do
+      let(:default_params) do
+        {
+          namespace_id: project.namespace,
+          project_id: project,
+          id: 'master/files/whitespace',
+          original_branch: 'master',
+          branch_name: 'master',
+          commit_message: 'Delete whitespace'
+        }
+      end
+
+      let(:after_delete_path) { project_tree_path(project, 'master/files') }
+
+      it 'redirects to the sub directory' do
+        delete :destroy, default_params
+
+        expect(response).to redirect_to(after_delete_path)
+      end
+    end
+
+    context 'if deleted file is the last one in a subdirectory' do
+      let(:default_params) do
+        {
+          namespace_id: project.namespace,
+          project_id: project,
+          id: 'master/bar/branch-test.txt',
+          original_branch: 'master',
+          branch_name: 'master',
+          commit_message: 'Delete whitespace'
+        }
+      end
+
+      it 'redirects to the project root' do
+        delete :destroy, default_params
+
+        expect(response).to redirect_to(project_root_path)
+      end
+
+      context 'when deleting a file in a branch other than master' do
+        let(:default_params) do
+          {
+            namespace_id: project.namespace,
+            project_id: project,
+            id: 'binary-encoding/foo/bar/.gitkeep',
+            original_branch: 'binary-encoding',
+            branch_name: 'binary-encoding',
+            commit_message: 'Delete whitespace'
+          }
+        end
+
+        let(:after_delete_path) { project_tree_path(project, 'binary-encoding') }
+
+        it 'redirects to the project root of the branch' do
+          delete :destroy, default_params
+
+          expect(response).to redirect_to(after_delete_path)
+        end
+      end
+    end
+  end
 end
diff --git a/spec/features/projects/files/user_deletes_files_spec.rb b/spec/features/projects/files/user_deletes_files_spec.rb
index dcb7b947c61..614b11fa5c8 100644
--- a/spec/features/projects/files/user_deletes_files_spec.rb
+++ b/spec/features/projects/files/user_deletes_files_spec.rb
@@ -31,7 +31,7 @@ describe 'Projects > Files > User deletes files', :js do
       fill_in(:commit_message, with: 'New commit message', visible: true)
       click_button('Delete file')
 
-      expect(current_path).to eq(project_tree_path(project, 'master'))
+      expect(current_path).to eq(project_tree_path(project, 'master/'))
       expect(page).not_to have_content('.gitignore')
     end
   end