diff --git a/java/compiler/impl/src/com/intellij/compiler/server/BuildManager.java b/java/compiler/impl/src/com/intellij/compiler/server/BuildManager.java
index 1ce97940706c..f125b8a8863a 100644
--- a/java/compiler/impl/src/com/intellij/compiler/server/BuildManager.java
+++ b/java/compiler/impl/src/com/intellij/compiler/server/BuildManager.java
@@ -1468,7 +1468,16 @@ public final class BuildManager implements Disposable {
     }
 
     if (ProjectUtilCore.isExternalStorageEnabled(project)) {
-      cmdLine.addPathParameter("-D" + GlobalOptions.EXTERNAL_PROJECT_CONFIG + '=', ProjectUtil.getExternalConfigurationDir(project));
+      Path externalProjectConfig = ProjectUtil.getExternalConfigurationDir(project);
+      String pathToExternalStorage;
+      if (canUseEel() && !EelPathUtils.isProjectLocal(project)) {
+        pathToExternalStorage = cmdLine.copyPathToHostIfRequired(externalProjectConfig);
+        cmdLine.addParameter("-D" + GlobalOptions.EXTERNAL_PROJECT_CONFIG + '=' + pathToExternalStorage);
+      }
+      else {
+        pathToExternalStorage = externalProjectConfig.toString();
+        cmdLine.addPathParameter("-D" + GlobalOptions.EXTERNAL_PROJECT_CONFIG + '=', pathToExternalStorage);
+      }
     }
 
     cmdLine.addParameter("-D" + GlobalOptions.COMPILE_PARALLEL_OPTION + '=' + projectConfig.isParallelCompilationEnabled());
diff --git a/java/compiler/impl/src/com/intellij/compiler/server/EelBuildCommandLineBuilder.kt b/java/compiler/impl/src/com/intellij/compiler/server/EelBuildCommandLineBuilder.kt
index 54e02d4e1da4..f83bf42c8f2f 100644
--- a/java/compiler/impl/src/com/intellij/compiler/server/EelBuildCommandLineBuilder.kt
+++ b/java/compiler/impl/src/com/intellij/compiler/server/EelBuildCommandLineBuilder.kt
@@ -16,6 +16,7 @@ import kotlinx.coroutines.future.asCompletableFuture
 import java.nio.charset.Charset
 import java.nio.file.FileSystems
 import java.nio.file.Path
+import kotlin.io.path.isDirectory
 import kotlin.io.path.name
 
 class EelBuildCommandLineBuilder(val project: Project, exePath: Path) : BuildCommandLineBuilder {
@@ -59,7 +60,15 @@ class EelBuildCommandLineBuilder(val project: Project, exePath: Path) : BuildCom
   }
 
   override fun copyPathToTargetIfRequired(path: Path): Path {
-    return EelPathUtils.transferContentsIfNonLocal(eel, path, workingDirectory.resolve("build-cache").resolve(path.name))
+    if (path.getEelDescriptor() != LocalEelDescriptor) return path
+    val remotePath = workingDirectory.resolve("build-cache").resolve(path.name)
+    if (path.isDirectory()) {
+      EelPathUtils.transferContentsIfNonLocal(eel, path, remotePath)
+    }
+    else if (path.getEelDescriptor() == LocalEelDescriptor) {
+      EelPathUtils.transferLocalContentToRemotePathIfNeeded(path, remotePath)
+    }
+    return remotePath
   }
 
   override fun copyPathToHostIfRequired(path: Path): String {
diff --git a/platform/eel-provider/src/com/intellij/platform/eel/provider/utils/eelPathUtils.kt b/platform/eel-provider/src/com/intellij/platform/eel/provider/utils/eelPathUtils.kt
index 2861d1b3e00d..843708925153 100644
--- a/platform/eel-provider/src/com/intellij/platform/eel/provider/utils/eelPathUtils.kt
+++ b/platform/eel-provider/src/com/intellij/platform/eel/provider/utils/eelPathUtils.kt
@@ -10,10 +10,7 @@ import com.intellij.platform.eel.*
 import com.intellij.platform.eel.fs.EelFileSystemApi
 import com.intellij.platform.eel.fs.EelFileSystemApi.CreateTemporaryEntryOptions
 import com.intellij.platform.eel.path.EelPath
-import com.intellij.platform.eel.provider.LocalEelDescriptor
-import com.intellij.platform.eel.provider.asEelPath
-import com.intellij.platform.eel.provider.asNioPath
-import com.intellij.platform.eel.provider.getEelDescriptor
+import com.intellij.platform.eel.provider.*
 import com.intellij.util.awaitCancellationAndInvoke
 import com.intellij.util.concurrency.annotations.RequiresBackgroundThread
 import kotlinx.coroutines.*
@@ -219,31 +216,34 @@ object EelPathUtils {
     }
   }
 
+  @JvmStatic
+  fun transferLocalContentToRemotePathIfNeeded(source: Path, remotePath: Path) {
+    val sourceDescriptor = source.getEelDescriptor()
+
+    check(sourceDescriptor is LocalEelDescriptor)
+
+    val sourceHash = calculateFileHash(source)
+
+    val remoteHash = if (Files.exists(remotePath)) {
+      calculateFileHash(remotePath)
+    }
+    else {
+      ""
+    }
+    if (sourceHash != remoteHash) {
+      if (remoteHash.isNotEmpty()) {
+        Files.delete(remotePath)
+      }
+      transferContentsIfNonLocal(remotePath.getEelDescriptor().upgradeBlocking(), source, remotePath)
+    }
+  }
+
   @Service
   private class TransferredContentHolder(private val scope: CoroutineScope) {
     // eel descriptor -> source path string ->> source hash -> transferred file
     private val cache = ConcurrentHashMap<Pair<EelDescriptor, String>, Deferred<Pair<String, Path>>>()
 
-    private fun calculateFileHash(path: Path): String {
-      val digest = MessageDigest.getInstance("SHA-256")
-      val attributes = Files.readAttributes(path, BasicFileAttributes::class.java)
-      val fileSize = attributes.size()
-      val lastModified = attributes.lastModifiedTime().toMillis()
 
-      digest.update(fileSize.toString().toByteArray())
-      digest.update(lastModified.toString().toByteArray())
-
-      FileChannel.open(path, StandardOpenOption.READ).use { channel ->
-        val buffer = java.nio.ByteBuffer.allocateDirect(1024 * 1024)
-        while (channel.read(buffer) > 0) {
-          buffer.flip()
-          digest.update(buffer)
-          buffer.clear()
-        }
-      }
-
-      return digest.digest().joinToString("") { "%02x".format(it) }
-    }
 
     @OptIn(ExperimentalCoroutinesApi::class)
     suspend fun transferIfNeeded(eel: EelApi, source: Path): Path {
@@ -278,6 +278,27 @@ object EelPathUtils {
     }
   }
 
+  private fun calculateFileHash(path: Path): String {
+    val digest = MessageDigest.getInstance("SHA-256")
+    val attributes = Files.readAttributes(path, BasicFileAttributes::class.java)
+    val fileSize = attributes.size()
+    val lastModified = attributes.lastModifiedTime().toMillis()
+
+    digest.update(fileSize.toString().toByteArray())
+    digest.update(lastModified.toString().toByteArray())
+
+    FileChannel.open(path, StandardOpenOption.READ).use { channel ->
+      val buffer = java.nio.ByteBuffer.allocateDirect(1024 * 1024)
+      while (channel.read(buffer) > 0) {
+        buffer.flip()
+        digest.update(buffer)
+        buffer.clear()
+      }
+    }
+
+    return digest.digest().joinToString("") { "%02x".format(it) }
+  }
+
   @JvmStatic
   fun getHomePath(descriptor: EelDescriptor): Path {
     // usually eel is already initialized to this moment