diff --git a/mfs/dir.go b/mfs/dir.go
index ba14464ae76..f6329dae812 100644
--- a/mfs/dir.go
+++ b/mfs/dir.go
@@ -339,17 +339,6 @@ func (d *Directory) AddChild(name string, nd *dag.Node) error {
 
 	d.modTime = time.Now()
 
-	if len(nd.Links) == 0 {
-		nfi, err := NewFile(name, nd, d, d.dserv)
-		if err != nil {
-			return err
-		}
-		d.files[name] = nfi
-	} else {
-		ndir := NewDirectory(d.ctx, name, nd, d, d.dserv)
-		d.childDirs[name] = ndir
-	}
-
 	return nil
 }
 
diff --git a/test/sharness/t0250-files-api.sh b/test/sharness/t0250-files-api.sh
index 806d0b14a33..0dac0d79c58 100755
--- a/test/sharness/t0250-files-api.sh
+++ b/test/sharness/t0250-files-api.sh
@@ -437,6 +437,25 @@ test_files_api() {
 	test_expect_success "child dir looks right" '
 		verify_dir_contents /
 	'
+
+  # test for https://github.com/ipfs/go-ipfs/issues/2654
+	test_expect_success "create and remove dir" '
+    ipfs files mkdir /test_dir &&
+    ipfs files rm -r "/test_dir"
+	'
+	test_expect_success "create test file" '
+    echo "content" | ipfs files write -e "/test_file"
+  '
+	test_expect_success "copy test file onto test dir" '
+    ipfs files cp "/test_file" "/test_dir"
+  '
+  test_expect_success "test /test_dir" '
+    ipfs files stat "/test_dir" | grep -q "^Type: file"
+  '
+  test_expect_success "clean up /test_dir and /test_file" '
+    ipfs files rm -r /test_dir &&
+    ipfs files rm -r /test_file
+  '
 }
 
 # test offline and online