diff --git a/core/org.eclipse.cdt.ui/META-INF/MANIFEST.MF b/core/org.eclipse.cdt.ui/META-INF/MANIFEST.MF
index dc3a7ccaf85..e4c932bb778 100644
--- a/core/org.eclipse.cdt.ui/META-INF/MANIFEST.MF
+++ b/core/org.eclipse.cdt.ui/META-INF/MANIFEST.MF
@@ -2,7 +2,7 @@ Manifest-Version: 1.0
 Bundle-ManifestVersion: 2
 Bundle-Name: %pluginName
 Bundle-SymbolicName: org.eclipse.cdt.ui; singleton:=true
-Bundle-Version: 8.0.200.qualifier
+Bundle-Version: 8.1.0.qualifier
 Bundle-Activator: org.eclipse.cdt.ui.CUIPlugin
 Bundle-Vendor: %providerName
 Bundle-Localization: plugin
diff --git a/core/org.eclipse.cdt.ui/src/org/eclipse/cdt/ui/newui/AbstractCPropertyTab.java b/core/org.eclipse.cdt.ui/src/org/eclipse/cdt/ui/newui/AbstractCPropertyTab.java
index 47fb72c7b4f..e2f5f2af4ae 100644
--- a/core/org.eclipse.cdt.ui/src/org/eclipse/cdt/ui/newui/AbstractCPropertyTab.java
+++ b/core/org.eclipse.cdt.ui/src/org/eclipse/cdt/ui/newui/AbstractCPropertyTab.java
@@ -496,28 +496,43 @@ public abstract class AbstractCPropertyTab implements ICPropertyTab {
 	}
 
 	public static String getWorkspaceDirDialog(Shell shell, String text) {
-		return getWorkspaceDialog(shell, text, true, null);
+		return getWorkspaceDialog(shell, text, true, true, null);
 	}
 
 	public static String getWorkspaceFileDialog(Shell shell, String text) {
-		return getWorkspaceDialog(shell, text, false, null);
+		return getWorkspaceDialog(shell, text, false, true, null);
+	}
+
+	/**
+	 * @since 8.1
+	 */
+	public static String getWorkspaceDirDialog(Shell shell, String text, IProject prj) {
+		return getWorkspaceDialog(shell, text, true, true, prj);
+	}
+
+	/**
+	 * @since 8.1
+	 */
+	public static String getWorkspaceFileDialog(Shell shell, String text, IProject prj) {
+		return getWorkspaceDialog(shell, text, false, true, prj);
 	}
 
 	/**
 	 * @since 5.4
 	 */
 	public static String getProjectDirDialog(Shell shell, String text, IProject prj) {
-		return getWorkspaceDialog(shell, text, true, prj);
+		return getWorkspaceDialog(shell, text, true, false, prj);
 	}
 
 	/**
 	 * @since 5.4
 	 */
 	public static String getProjectFileDialog(Shell shell, String text, IProject prj) {
-		return getWorkspaceDialog(shell, text, false, prj);
+		return getWorkspaceDialog(shell, text, false, false, prj);
 	}
 
-	private static String getWorkspaceDialog(Shell shell, String text, boolean dir, IProject prj) {
+	private static String getWorkspaceDialog(Shell shell, String text, boolean dir, boolean selectFromRoot,
+			IProject prj) {
 		String currentPathText;
 		IPath path;
 		currentPathText = text;
@@ -528,7 +543,7 @@ public abstract class AbstractCPropertyTab implements ICPropertyTab {
 		ElementTreeSelectionDialog dialog = new ElementTreeSelectionDialog(shell, new WorkbenchLabelProvider(),
 				new WorkbenchContentProvider());
 
-		if (prj == null)
+		if (prj == null || selectFromRoot)
 			dialog.setInput(ResourcesPlugin.getWorkspace().getRoot());
 		else
 			dialog.setInput(prj);
@@ -576,8 +591,14 @@ public abstract class AbstractCPropertyTab implements ICPropertyTab {
 		if (dialog.open() == Window.OK) {
 			IResource resource = (IResource) dialog.getFirstResult();
 			if (resource != null) {
+				if (resource.getProject().equals(prj)) {
+					String projectPath = new Path("${ProjName}").append(resource.getProjectRelativePath()) //$NON-NLS-1$
+							.makeAbsolute().toString();
+					return "${workspace_loc:" + projectPath + "}"; //$NON-NLS-1$ //$NON-NLS-2$
+				}
 				StringBuilder buf = new StringBuilder();
 				return buf.append("${").append("workspace_loc:").append(resource.getFullPath()).append("}").toString(); //$NON-NLS-3$ //$NON-NLS-2$ //$NON-NLS-1$
+
 			}
 		}
 		return null;
diff --git a/core/org.eclipse.cdt.ui/src/org/eclipse/cdt/ui/newui/IncludeDialog.java b/core/org.eclipse.cdt.ui/src/org/eclipse/cdt/ui/newui/IncludeDialog.java
index c0e43504677..7f0928d060f 100644
--- a/core/org.eclipse.cdt.ui/src/org/eclipse/cdt/ui/newui/IncludeDialog.java
+++ b/core/org.eclipse.cdt.ui/src/org/eclipse/cdt/ui/newui/IncludeDialog.java
@@ -18,6 +18,7 @@ import org.eclipse.cdt.core.settings.model.ICMultiConfigDescription;
 import org.eclipse.cdt.core.settings.model.ICSettingEntry;
 import org.eclipse.cdt.internal.ui.newui.Messages;
 import org.eclipse.cdt.ui.CDTSharedImages;
+import org.eclipse.core.resources.IProject;
 import org.eclipse.jface.dialogs.IDialogConstants;
 import org.eclipse.swt.SWT;
 import org.eclipse.swt.events.ModifyEvent;
@@ -205,10 +206,11 @@ public class IncludeDialog extends AbstractPropertyDialog {
 		} else if (e.widget.equals(b_ko)) {
 			shell.dispose();
 		} else if (e.widget.equals(b_work)) {
+			IProject project = cfgd.getProjectDescription().getProject();
 			if ((mode & DIR_MASK) == DIR_MASK)
-				s = AbstractCPropertyTab.getWorkspaceDirDialog(shell, text.getText());
+				s = AbstractCPropertyTab.getWorkspaceDirDialog(shell, text.getText(), project);
 			else
-				s = AbstractCPropertyTab.getWorkspaceFileDialog(shell, text.getText());
+				s = AbstractCPropertyTab.getWorkspaceFileDialog(shell, text.getText(), project);
 			if (s != null) {
 				s = strip_wsp(s);
 				text.setText(s);