diff --git a/tests/func/test_external_repo.py b/tests/func/test_external_repo.py
index de2b8b20b..6806a0855 100644
--- a/tests/func/test_external_repo.py
+++ b/tests/func/test_external_repo.py
@@ -4,21 +4,27 @@ from mock import patch
 
 from dvc.external_repo import external_repo
 from dvc.scm.git import Git
+from dvc.compat import fspath
 from dvc.utils.fs import path_isin
 
 
-def test_external_repo(erepo):
-    url = erepo.root_dir
+def test_external_repo(erepo_dir):
+    with erepo_dir.chdir():
+        with erepo_dir.branch("branch", new=True):
+            erepo_dir.dvc_gen("file", "branch", commit="create file on branch")
+        erepo_dir.dvc_gen("file", "master", commit="create file on master")
+
+    url = fspath(erepo_dir)
     # We will share cache dir, to fetch version file
-    cache_dir = erepo.dvc.cache.local.cache_dir
+    cache_dir = erepo_dir.dvc.cache.local.cache_dir
 
     with patch.object(Git, "clone", wraps=Git.clone) as mock:
         with external_repo(url, cache_dir=cache_dir) as repo:
-            with repo.open(os.path.join(repo.root_dir, "version")) as fd:
+            with repo.open(os.path.join(repo.root_dir, "file")) as fd:
                 assert fd.read() == "master"
 
         with external_repo(url, rev="branch", cache_dir=cache_dir) as repo:
-            with repo.open(os.path.join(repo.root_dir, "version")) as fd:
+            with repo.open(os.path.join(repo.root_dir, "file")) as fd:
                 assert fd.read() == "branch"
 
         # Check cache_dir is unset