diff --git a/dvc/project.py b/dvc/project.py
index c71a0b2b7..5321f20f3 100644
--- a/dvc/project.py
+++ b/dvc/project.py
@@ -10,7 +10,7 @@ from dvc.logger import Logger
 from dvc.exceptions import DvcException
 from dvc.stage import Stage
 from dvc.config import Config
-from dvc.state import LinkState
+from dvc.state import LinkState, State
 from dvc.lock import Lock
 from dvc.scm import SCM, Base
 from dvc.cache import Cache
@@ -50,6 +50,9 @@ class Project(object):
         self.config = Config(self.dvc_dir)
         self.scm = SCM(self.root_dir)
         self.lock = Lock(self.dvc_dir)
+        # NOTE: storing state and link_state in the repository itself to avoid
+        # any possible state corruption in 'shared cache dir' scenario.
+        self.state = State(self.dvc_dir)
         self.link_state = LinkState(self.root_dir, self.dvc_dir)
         self.logger = Logger(self.config._config[Config.SECTION_CORE].get(Config.SECTION_CORE_LOGLEVEL, None))
         self.cache = Cache(self)
diff --git a/dvc/remote/local.py b/dvc/remote/local.py
index 3aa7ae519..3cd9f8804 100644
--- a/dvc/remote/local.py
+++ b/dvc/remote/local.py
@@ -31,6 +31,7 @@ class RemoteLOCAL(RemoteBase):
 
     def __init__(self, project, config):
         self.project = project
+        self.state = self.project.state
         self.link_state = project.link_state
         storagepath = config.get(Config.SECTION_AWS_STORAGEPATH, None)
         self.cache_dir = config.get(Config.SECTION_REMOTE_URL, storagepath)
@@ -46,8 +47,6 @@ class RemoteLOCAL(RemoteBase):
         if self.cache_dir != None and not os.path.exists(self.cache_dir):
             os.mkdir(self.cache_dir)
 
-        self.state = State(self.cache_dir)
-
     @property
     def prefix(self):
         return self.cache_dir