diff --git a/Sources/SwiftDriver/ExplicitModuleBuilds/InterModuleDependencies/CommonDependencyOperations.swift b/Sources/SwiftDriver/ExplicitModuleBuilds/InterModuleDependencies/CommonDependencyOperations.swift
index dc650a222..caf2ec276 100644
--- a/Sources/SwiftDriver/ExplicitModuleBuilds/InterModuleDependencies/CommonDependencyOperations.swift
+++ b/Sources/SwiftDriver/ExplicitModuleBuilds/InterModuleDependencies/CommonDependencyOperations.swift
@@ -367,7 +367,7 @@ internal extension InterModuleDependencyGraph {
       }
     }
 
-    // Check if any of the textual sources of this module are newer than this module
+    // Check if any of the input sources of this module are newer than this module
     switch checkedModuleInfo.details {
     case .swift(let swiftDetails):
       if let moduleInterfacePath = swiftDetails.moduleInterfacePath {
@@ -400,11 +400,12 @@ internal extension InterModuleDependencyGraph {
         }
       }
     case .swiftPrebuiltExternal(_):
-      // TODO: We have to give-up here until we have a way to verify the timestamp of the binary module.
-      // We can do better here by knowing if this module hasn't changed - which would allows us to not
-      // invalidate any of the dependencies that depend on it.
-      reporter?.report("Unable to verify binary module dependency up-to-date: \(moduleID.moduleNameForDiagnostic)")
-      return false;
+      // We do not verify the binary module itself being out-of-date if we do not have a textual
+      // interface it was built from, but we can safely treat it as up-to-date, particularly
+      // because if it is newer than any of the modules they depend on it, they will
+      // still get invalidated in the check above for whether a module has
+      // any dependencies newer than it.
+      return true;
     case .swiftPlaceholder(_):
       // TODO: This should never ever happen. Hard error?
       return false;
diff --git a/Tests/SwiftDriverTests/IncrementalCompilationTests.swift b/Tests/SwiftDriverTests/IncrementalCompilationTests.swift
index 57de8be9a..7d6d8a5e4 100644
--- a/Tests/SwiftDriverTests/IncrementalCompilationTests.swift
+++ b/Tests/SwiftDriverTests/IncrementalCompilationTests.swift
@@ -516,6 +516,56 @@ extension IncrementalCompilationTests {
       linking
     }
   }
+
+  func testExplicitIncrementalBuildUnchangedBinaryDependencyDoesNotInvalidateUpstreamDependencies() throws {
+    replace(contentsOf: "other", with: "import J;")
+
+    // After an initial build, replace the G.swiftinterface with G.swiftmodule
+    // and repeat the initial build to settle into the "initial" state for the test
+    try buildInitialState(checkDiagnostics: false, explicitModuleBuild: true)
+    let modCacheEntries = try localFileSystem.getDirectoryContents(explicitModuleCacheDir)
+    let nameOfGModule = try XCTUnwrap(modCacheEntries.first { $0.hasPrefix("G") && $0.hasSuffix(".swiftmodule")})
+    let pathToGModule = explicitModuleCacheDir.appending(component: nameOfGModule)
+    // Rename the binary module to G.swiftmodule so that the next build's scan finds it.
+    let newPathToGModule = explicitSwiftDependenciesPath.appending(component: "G.swiftmodule")
+    try! localFileSystem.move(from: pathToGModule, to: newPathToGModule)
+    // Delete the textual interface it was built from so that it is treated as a binary-only dependency now.
+    try! localFileSystem.removeFileTree(try AbsolutePath(validating: explicitSwiftDependenciesPath.appending(component: "G.swiftinterface").pathString))
+    try buildInitialState(checkDiagnostics: false, explicitModuleBuild: true)
+
+    // Touch one of the inputs to actually trigger the incremental build, so that we can ensure
+    // no module deps get re-built
+    touch(inputPath(basename: "other"))
+
+    try doABuild(
+      "Unchanged binary dependency (G)",
+      checkDiagnostics: true,
+      extraArguments: explicitBuildArgs,
+      whenAutolinking: autolinkLifecycleExpectedDiags
+    ) {
+      readGraph
+      enablingCrossModule
+      noFingerprintInSwiftModule("G.swiftinterface")
+      dependencyNewerThanNode("G.swiftinterface")
+      dependencyNewerThanNode("G.swiftinterface") // FIXME: Why do we see this twice?
+      readInterModuleGraph
+      interModuleDependencyGraphUpToDate // Graph declared up-to-date despite a downstream dependency on a binary Swift module dependency
+      maySkip("main")
+      schedulingChangedInitialQueuing("other")
+      fingerprintsMissingOfTopLevelName(name: "foo", "main")
+      invalidatedExternally("main", "other")
+      queuingInitial("main")
+      foundBatchableJobs(2)
+      formingOneBatch
+      addingToBatchThenForming("main", "other")
+      compiling("main", "other")
+      reading(deps: "main")
+      reading(deps: "other")
+      schedulingPostCompileJobs
+      linking
+
+    }
+  }
 }
 
 extension IncrementalCompilationTests {