diff --git a/setup.py b/setup.py
index 85228bd37ae..881ff49ab84 100644
--- a/setup.py
+++ b/setup.py
@@ -684,6 +684,21 @@ class CustomBuildPy(build_py):
     a file to a different relative location under the output package directory.
     """
 
+    def analyze_manifest(self):
+        super().analyze_manifest()
+        # Recent versions of setuptools may include bare directory symlinks from version
+        # control (e.g. src/executorch/{backends,codegen,data,...} ->
+        # ../../<name>) in manifest_files. These exist for editable mode but
+        # break regular installs: build_package_data passes them to copy_file,
+        # which calls os.path.isfile() and gets False for a symlink-to-directory.
+        if not self.editable_mode:
+            _root = os.path.dirname(os.path.abspath(__file__))
+            for _pkg in list(self.manifest_files):
+                self.manifest_files[_pkg] = [
+                    _f for _f in self.manifest_files[_pkg]
+                    if os.path.isfile(os.path.join(_root, _f))
+                ]
+
     def run(self):
         # Copy python files to the output directory. This set of files is
         # defined by the py_module list and package_data patterns.