diff --git a/packages/playwright-test/src/third_party/tsconfig-loader.ts b/packages/playwright-test/src/third_party/tsconfig-loader.ts
index d1cf7bda47..c6a0ae2c3e 100644
--- a/packages/playwright-test/src/third_party/tsconfig-loader.ts
+++ b/packages/playwright-test/src/third_party/tsconfig-loader.ts
@@ -37,6 +37,7 @@ interface Tsconfig {
     baseUrl?: string;
     paths?: { [key: string]: Array<string> };
     strict?: boolean;
+    allowJs?: boolean;
   };
 }
 
@@ -45,6 +46,7 @@ export interface TsConfigLoaderResult {
   baseUrl: string | undefined;
   paths: { [key: string]: Array<string> } | undefined;
   serialized: string | undefined;
+  allowJs: boolean;
 }
 
 export interface TsConfigLoaderParams {
@@ -72,6 +74,7 @@ function loadSyncDefault(
       baseUrl: undefined,
       paths: undefined,
       serialized: undefined,
+      allowJs: false,
     };
   }
   const config = loadTsconfig(configPath);
@@ -82,6 +85,7 @@ function loadSyncDefault(
       (config && config.compilerOptions && config.compilerOptions.baseUrl),
     paths: config && config.compilerOptions && config.compilerOptions.paths,
     serialized: undefined,
+    allowJs: !!config?.compilerOptions?.allowJs,
   };
 }
 
diff --git a/packages/playwright-test/src/transform.ts b/packages/playwright-test/src/transform.ts
index f830e5017e..5add8c15c1 100644
--- a/packages/playwright-test/src/transform.ts
+++ b/packages/playwright-test/src/transform.ts
@@ -33,6 +33,7 @@ const sourceMaps: Map<string, string> = new Map();
 type ParsedTsConfigData = {
   absoluteBaseUrl: string;
   paths: { key: string, values: string[] }[];
+  allowJs: boolean;
 };
 const cachedTSConfigs = new Map<string, ParsedTsConfigData | undefined>();
 
@@ -73,7 +74,11 @@ function validateTsConfig(tsconfig: TsConfigLoaderResult): ParsedTsConfigData |
   // Make 'baseUrl' absolute, because it is relative to the tsconfig.json, not to cwd.
   const absoluteBaseUrl = path.resolve(path.dirname(tsconfig.tsConfigPath), tsconfig.baseUrl);
   const paths = tsconfig.paths || { '*': ['*'] };
-  return { absoluteBaseUrl, paths: Object.entries(paths).map(([key, values]) => ({ key, values })) };
+  return {
+    allowJs: tsconfig.allowJs,
+    absoluteBaseUrl,
+    paths: Object.entries(paths).map(([key, values]) => ({ key, values }))
+  };
 }
 
 function loadAndValidateTsconfigForFile(file: string): ParsedTsConfigData | undefined {
@@ -95,9 +100,16 @@ const builtins = new Set(Module.builtinModules);
 export function resolveHook(isModule: boolean, filename: string, specifier: string): string | undefined {
   if (builtins.has(specifier))
     return;
+  // In real life, playwright-test is under node_modules, but in the tests it isn't.
+  if (filename.startsWith(kPlaywrightInternalPrefix))
+    return;
+
+  if (isRelativeSpecifier(specifier))
+    return isModule ? js2ts(path.resolve(path.dirname(filename), specifier)) : undefined;
+
   const isTypeScript = filename.endsWith('.ts') || filename.endsWith('.tsx');
-  const tsconfig = isTypeScript ? loadAndValidateTsconfigForFile(filename) : undefined;
-  if (tsconfig && !isRelativeSpecifier(specifier)) {
+  const tsconfig = loadAndValidateTsconfigForFile(filename);
+  if (tsconfig && (isTypeScript || tsconfig.allowJs)) {
     let longestPrefixLength = -1;
     let pathMatchedByLongestPrefix: string | undefined;
 
diff --git a/tests/playwright-test/resolver.spec.ts b/tests/playwright-test/resolver.spec.ts
index 313139fdf1..1ac8cc2ec3 100644
--- a/tests/playwright-test/resolver.spec.ts
+++ b/tests/playwright-test/resolver.spec.ts
@@ -14,7 +14,7 @@
  * limitations under the License.
  */
 
-import { test, expect } from './playwright-test-fixtures';
+import { test, expect, stripAnsi } from './playwright-test-fixtures';
 
 test('should respect path resolver', async ({ runInlineTest }) => {
   test.info().annotations.push({ type: 'issue', description: 'https://github.com/microsoft/playwright/issues/11656' });
@@ -343,3 +343,58 @@ test('should not use baseurl for relative imports when dir with same name exists
   expect(result.output).not.toContain(`Could not`);
   expect(result.output).not.toContain(`Cannot`);
 });
+
+test('should respect path resolver for JS files when allowJs', async ({ runInlineTest }) => {
+  const result = await runInlineTest({
+    'playwright.config.ts': `export default { projects: [{name: 'foo'}], };`,
+    'tsconfig.json': `{
+      "compilerOptions": {
+        "allowJs": true,
+        "baseUrl": ".",
+        "paths": {
+          "util/*": ["./foo/bar/util/*"],
+        },
+      },
+    }`,
+    'a.test.js': `
+      const { foo } = require('util/b');
+      const { test } = pwt;
+      test('test', ({}, testInfo) => {
+        expect(testInfo.project.name).toBe(foo);
+      });
+    `,
+    'foo/bar/util/b.ts': `
+      module.exports = { foo: 'foo' };
+    `,
+  });
+
+  expect(result.passed).toBe(1);
+  expect(result.exitCode).toBe(0);
+});
+
+test('should not respect path resolver for JS files w/o allowJS', async ({ runInlineTest }) => {
+  const result = await runInlineTest({
+    'playwright.config.ts': `export default { projects: [{name: 'foo'}], };`,
+    'tsconfig.json': `{
+      "compilerOptions": {
+        "baseUrl": ".",
+        "paths": {
+          "util/*": ["./foo/bar/util/*"],
+        },
+      },
+    }`,
+    'a.test.js': `
+      const { foo } = require('util/b');
+      const { test } = pwt;
+      test('test', ({}, testInfo) => {
+        expect(testInfo.project.name).toBe(foo);
+      });
+    `,
+    'foo/bar/util/b.ts': `
+      module.exports = { foo: 'foo' };
+    `,
+  });
+
+  expect(stripAnsi(result.output)).toContain('Cannot find module \'util/b\'');
+  expect(result.exitCode).toBe(1);
+});