diff --git a/builtin/reset.c b/builtin/reset.c
index 023fe12be048b2..91875a2657aab5 100644
--- a/builtin/reset.c
+++ b/builtin/reset.c
@@ -27,6 +27,7 @@
 #include "submodule-config.h"
 #include "strbuf.h"
 #include "quote.h"
+#include "dir.h"
 
 #define REFRESH_INDEX_DELAY_WARNING_IN_MS (2 * 1000)
 
@@ -128,12 +129,45 @@ static void update_index_from_diff(struct diff_queue_struct *q,
 		struct diff_options *opt, void *data)
 {
 	int i;
+	int pos;
 	int intent_to_add = *(int *)data;
 
 	for (i = 0; i < q->nr; i++) {
 		struct diff_filespec *one = q->queue[i]->one;
+		struct diff_filespec *two = q->queue[i]->two;
 		int is_missing = !(one->mode && !is_null_oid(&one->oid));
+		int was_missing = !two->mode && is_null_oid(&two->oid);
 		struct cache_entry *ce;
+		struct cache_entry *ceBefore;
+		struct checkout state = CHECKOUT_INIT;
+
+		/*
+		 * When using the sparse-checkout feature the cache entries that are
+		 * added here will not have the skip-worktree bit set.
+		 * Without this code there is data that is lost because the files that
+		 * would normally be in the working directory are not there and show as
+		 * deleted for the next status or in the case of added files just disappear.
+		 * We need to create the previous version of the files in the working
+		 * directory so that they will have the right content and the next
+		 * status call will show modified or untracked files correctly.
+		 */
+		if (core_apply_sparse_checkout && !file_exists(two->path))
+		{
+			pos = cache_name_pos(two->path, strlen(two->path));
+			if ((pos >= 0 && ce_skip_worktree(active_cache[pos])) && (is_missing || !was_missing))
+			{
+				state.force = 1;
+				state.refresh_cache = 1;
+				state.istate = &the_index;
+				ceBefore = make_cache_entry(&the_index, two->mode, &two->oid, two->path,
+					0, 0);
+				if (!ceBefore)
+					die(_("make_cache_entry failed for path '%s'"),
+						two->path);
+
+				checkout_entry(ceBefore, &state, NULL, NULL);
+			}
+		}
 
 		if (is_missing && !intent_to_add) {
 			remove_file_from_cache(one->path);
diff --git a/t/t7114-reset-sparse-checkout.sh b/t/t7114-reset-sparse-checkout.sh
new file mode 100755
index 00000000000000..8dd88fd46d3938
--- /dev/null
+++ b/t/t7114-reset-sparse-checkout.sh
@@ -0,0 +1,58 @@
+#!/bin/sh
+
+test_description='reset when using a sparse-checkout'
+
+. ./test-lib.sh
+
+# reset using a sparse-checkout file
+
+test_expect_success 'setup' '
+	test_tick &&
+	echo "checkout file" >c &&
+	echo "modify file" >m &&
+	echo "delete file" >d &&
+	git add . &&
+	git commit -m "initial commit" &&
+	echo "added file" >a &&
+	echo "modification of a file" >m &&
+	git rm d &&
+	git add . &&
+	git commit -m "second commit" &&
+	git checkout -b endCommit
+'
+
+test_expect_success 'reset when there is a sparse-checkout' '
+	echo "/c" >.git/info/sparse-checkout &&
+	test_config core.sparsecheckout true &&
+	git checkout -b resetBranch &&
+	test_path_is_missing m &&
+	test_path_is_missing a &&
+	test_path_is_missing d &&
+	git reset HEAD~1 &&
+	test "checkout file" = "$(cat c)" &&
+	test "modification of a file" = "$(cat m)" &&
+	test "added file" = "$(cat a)" &&
+	test_path_is_missing d
+'
+
+test_expect_success 'reset after deleting file without skip-worktree bit' '
+	git checkout -f endCommit &&
+	git clean -xdf &&
+	echo "/c
+/m" >.git/info/sparse-checkout &&
+	test_config core.sparsecheckout true &&
+	git checkout -b resetAfterDelete &&
+	test_path_is_file m &&
+	test_path_is_missing a &&
+	test_path_is_missing d &&
+	rm -f m &&
+	git reset HEAD~1 &&
+	test "checkout file" = "$(cat c)" &&
+	test "added file" = "$(cat a)" &&
+	test_path_is_missing m &&
+	test_path_is_missing d
+'
+
+
+
+test_done