diff --git a/packages/react-dev-utils/README.md b/packages/react-dev-utils/README.md
index 5279ade8f41..e05780ed0a9 100644
--- a/packages/react-dev-utils/README.md
+++ b/packages/react-dev-utils/README.md
@@ -287,6 +287,32 @@ const publicPath = config.output.publicPath;
 printHostingInstructions(appPackage, publicUrl, publicPath, 'build', true);
 ```
 
+#### `checkShouldIgnoreNodeModules(): boolean`
+
+Checks if `node_modules` should be ignored from file watching.<br>
+Excessive polling can cause CPU overloads on some systems (see https://github.com/facebookincubator/create-react-app/issues/293), so we use two heuristics to determine if `chokidar` file watching is going to use polling:
+
+- The state of the `process.env.CHOKIDAR_USEPOLLING` environment variable
+- The existence of `fsevents` module on OSX.
+
+If the environment variable is truthy, or `fsevent` either doesn't exist or it fails to load, polling is enforced and we
+we ignore node_modules.
+
+```js
+const WebpackDevServer = require('webpack-dev-server');
+const shouldIgnoreNodeModules = require('react-dev-utils/checkShouldIgnoreNodeModules');
+const watchOptions = {};
+
+if (shouldIgnoreNodeModules) {
+  watchOptions.ignored = /node_modules;
+}
+
+const compiler = /**/
+const server = new WebpackDevServer(compiler, {
+  watchOptions,
+});
+```
+
 #### `WebpackDevServerUtils`
 
 ##### `choosePort(host: string, defaultPort: number): Promise<number | null>`
diff --git a/packages/react-dev-utils/__tests__/.eslintrc b/packages/react-dev-utils/__tests__/.eslintrc
deleted file mode 100644
index 55f121d152d..00000000000
--- a/packages/react-dev-utils/__tests__/.eslintrc
+++ /dev/null
@@ -1,5 +0,0 @@
-{
-  "env": {
-    "jest": true
-  }
-}
diff --git a/packages/react-dev-utils/__tests__/ignoredFiles.test.js b/packages/react-dev-utils/__tests__/ignoredFiles.test.js
deleted file mode 100644
index 6feed979797..00000000000
--- a/packages/react-dev-utils/__tests__/ignoredFiles.test.js
+++ /dev/null
@@ -1,55 +0,0 @@
-/**
- * Copyright (c) 2015-present, Facebook, Inc.
- *
- * This source code is licensed under the MIT license found in the
- * LICENSE file in the root directory of this source tree.
- */
-
-'use strict';
-
-const ignoredFiles = require('../ignoredFiles');
-
-describe('ignore watch files regex', () => {
-  it('normal file', () => {
-    const appSrc = '/root/src/';
-    const isIgnored = ignoredFiles(appSrc).test('/foo');
-    const isIgnoredInSrc = ignoredFiles(appSrc).test('/root/src/foo');
-
-    expect(isIgnored).toBe(false);
-    expect(isIgnoredInSrc).toBe(false);
-  });
-
-  it('node modules', () => {
-    const appSrc = '/root/src/';
-    const isIgnored = ignoredFiles(appSrc).test('/root/node_modules/foo');
-
-    expect(isIgnored).toBe(true);
-  });
-
-  it('node modules inside source directory', () => {
-    const appSrc = '/root/src/';
-    const isIgnored = ignoredFiles(appSrc).test('/root/src/node_modules/foo');
-    const isIgnoredMoreThanOneLevel = ignoredFiles(appSrc).test(
-      '/root/src/bar/node_modules/foo'
-    );
-
-    expect(isIgnored).toBe(false);
-    expect(isIgnoredMoreThanOneLevel).toBe(false);
-  });
-
-  it('path contains source directory', () => {
-    const appSrc = '/root/src/';
-    const isIgnored = ignoredFiles(appSrc).test(
-      '/bar/root/src/node_modules/foo'
-    );
-
-    expect(isIgnored).toBe(true);
-  });
-
-  it('path starts with source directory', () => {
-    const appSrc = '/root/src/';
-    const isIgnored = ignoredFiles(appSrc).test('/root/src2/node_modules/foo');
-
-    expect(isIgnored).toBe(true);
-  });
-});
diff --git a/packages/react-dev-utils/ignoredFiles.js b/packages/react-dev-utils/ignoredFiles.js
deleted file mode 100644
index 73a6e8bc5cf..00000000000
--- a/packages/react-dev-utils/ignoredFiles.js
+++ /dev/null
@@ -1,20 +0,0 @@
-/**
- * Copyright (c) 2015-present, Facebook, Inc.
- *
- * This source code is licensed under the MIT license found in the
- * LICENSE file in the root directory of this source tree.
- */
-
-'use strict';
-
-const path = require('path');
-const escape = require('escape-string-regexp');
-
-module.exports = function ignoredFiles(appSrc) {
-  return new RegExp(
-    `^(?!${escape(
-      path.normalize(appSrc + '/').replace(/[\\]+/g, '/')
-    )}).+/node_modules/`,
-    'g'
-  );
-};
diff --git a/packages/react-dev-utils/package.json b/packages/react-dev-utils/package.json
index ca08b4e612b..5465651d897 100644
--- a/packages/react-dev-utils/package.json
+++ b/packages/react-dev-utils/package.json
@@ -20,7 +20,6 @@
     "FileSizeReporter.js",
     "formatWebpackMessages.js",
     "getProcessForPort.js",
-    "ignoredFiles.js",
     "inquirer.js",
     "InterpolateHtmlPlugin.js",
     "launchEditor.js",
@@ -31,6 +30,7 @@
     "openChrome.applescript",
     "printBuildError.js",
     "printHostingInstructions.js",
+    "shouldIgnoreNodeModules.js",
     "WatchMissingNodeModulesPlugin.js",
     "WebpackDevServerUtils.js",
     "webpackHotDevClient.js",
@@ -62,8 +62,5 @@
   },
   "devDependencies": {
     "jest": "22.1.2"
-  },
-  "scripts": {
-    "test": "jest"
   }
 }
diff --git a/packages/react-dev-utils/shouldIgnoreNodeModules.js b/packages/react-dev-utils/shouldIgnoreNodeModules.js
new file mode 100644
index 00000000000..bb4d2088dea
--- /dev/null
+++ b/packages/react-dev-utils/shouldIgnoreNodeModules.js
@@ -0,0 +1,60 @@
+/**
+ * Copyright (c) 2018-present, Facebook, Inc.
+ *
+ * This source code is licensed under the MIT license found in the
+ * LICENSE file in the root directory of this source tree.
+ */
+
+'use strict';
+
+// While Create React App does not use polling for watching files by default,
+// polling can occur if CHOKIDAR_USEPOLLING environment variable is
+// set to a truthy value. Excessive polling can cause CPU overloads
+// on some systems (see https://github.com/facebookincubator/create-react-app/issues/293),
+// which is why we ignore node_modules if polling is enforced.
+let shouldIgnoreNodeModules = false;
+
+const envForceUsePolling = process.env.CHOKIDAR_USEPOLLING;
+
+if (envForceUsePolling) {
+  const usePollingLower = envForceUsePolling.toLowerCase();
+
+  // Chokidar rules https://github.com/paulmillr/chokidar/blob/master/index.js#L99
+  if (
+    usePollingLower === 'true' ||
+    usePollingLower === '1' ||
+    !!usePollingLower
+  ) {
+    shouldIgnoreNodeModules = true;
+  }
+}
+
+if (process.platform === 'darwin') {
+  // On OSX polling can also occur if chokidar fails to load the
+  // `fsevents` module. Check if the module is loaded:
+  const cacheKeys = Object.keys(require.cache);
+  const cachedFsEvents =
+    require.cache[cacheKeys.find(i => i.includes('/fsevents/fsevents.js'))];
+
+  if (cachedFsEvents && cachedFsEvents.loaded) {
+    // fsEvents is loaded, check if its WebpackDevServers
+    let parentIsWebpackDevServer = false;
+    let parent = cachedFsEvents.parent;
+
+    while (parent && !parentIsWebpackDevServer) {
+      if (parent.id.includes('webpack-dev-server')) {
+        parentIsWebpackDevServer = true;
+      }
+
+      parent = parent.parent;
+    }
+
+    if (!parentIsWebpackDevServer) {
+      shouldIgnoreNodeModules = true;
+    }
+  } else {
+    shouldIgnoreNodeModules = true;
+  }
+}
+
+module.exports = shouldIgnoreNodeModules;
diff --git a/packages/react-scripts/config/webpackDevServer.config.js b/packages/react-scripts/config/webpackDevServer.config.js
index 74119d27f39..b5f19e8b58a 100644
--- a/packages/react-scripts/config/webpackDevServer.config.js
+++ b/packages/react-scripts/config/webpackDevServer.config.js
@@ -10,13 +10,19 @@
 
 const errorOverlayMiddleware = require('react-dev-utils/errorOverlayMiddleware');
 const noopServiceWorkerMiddleware = require('react-dev-utils/noopServiceWorkerMiddleware');
-const ignoredFiles = require('react-dev-utils/ignoredFiles');
+const shouldIgnoreNodeModules = require('react-dev-utils/shouldIgnoreNodeModules');
 const config = require('./webpack.config.dev');
 const paths = require('./paths');
 
 const protocol = process.env.HTTPS === 'true' ? 'https' : 'http';
 const host = process.env.HOST || '0.0.0.0';
 
+const watchOptions = {};
+
+if (shouldIgnoreNodeModules) {
+  watchOptions.ignored = /node_modules/;
+}
+
 module.exports = function(proxy, allowedHost) {
   return {
     // WebpackDevServer 2.4.3 introduced a security fix that prevents remote
@@ -71,13 +77,7 @@ module.exports = function(proxy, allowedHost) {
     // WebpackDevServer is noisy by default so we emit custom message instead
     // by listening to the compiler events with `compiler.plugin` calls above.
     quiet: true,
-    // Reportedly, this avoids CPU overload on some systems.
-    // https://github.com/facebook/create-react-app/issues/293
-    // src/node_modules is not ignored to support absolute imports
-    // https://github.com/facebook/create-react-app/issues/1065
-    watchOptions: {
-      ignored: ignoredFiles(paths.appSrc),
-    },
+    watchOptions,
     // Enable HTTPS if the HTTPS environment variable is set to 'true'
     https: protocol === 'https',
     host: host,
diff --git a/packages/react-scripts/template/README.md b/packages/react-scripts/template/README.md
index 2c533d49687..052678303fb 100644
--- a/packages/react-scripts/template/README.md
+++ b/packages/react-scripts/template/README.md
@@ -2490,7 +2490,7 @@ HTTPS | :white_check_mark: | :x: | When set to `true`, Create React App will run
 PUBLIC_URL | :x: | :white_check_mark: | Create React App assumes your application is hosted at the serving web server's root or a subpath as specified in [`package.json` (`homepage`)](#building-for-relative-paths). Normally, Create React App ignores the hostname. You may use this variable to force assets to be referenced verbatim to the url you provide (hostname included). This may be particularly useful when using a CDN to host your application.
 CI | :large_orange_diamond: | :white_check_mark: | When set to `true`, Create React App treats warnings as failures in the build. It also makes the test runner non-watching. Most CIs set this flag by default.
 REACT_EDITOR | :white_check_mark: | :x: | When an app crashes in development, you will see an error overlay with clickable stack trace. When you click on it, Create React App will try to determine the editor you are using based on currently running processes, and open the relevant source file. You can [send a pull request to detect your editor of choice](https://github.com/facebook/create-react-app/issues/2636). Setting this environment variable overrides the automatic detection. If you do it, make sure your systems [PATH](https://en.wikipedia.org/wiki/PATH_(variable)) environment variable points to your editor’s bin folder. You can also set it to `none` to disable it completely.
-CHOKIDAR_USEPOLLING | :white_check_mark: | :x: | When set to `true`, the watcher runs in polling mode, as necessary inside a VM. Use this option if `npm start` isn't detecting changes.
+CHOKIDAR_USEPOLLING | :white_check_mark: | :x: | When set to `true`, the watcher runs in polling mode, as necessary inside a VM. Use this option if `npm start` isn't detecting changes. Note that setting this option to `true` disables `node_modules` watching due to the resource intensive nature of the operation.
 GENERATE_SOURCEMAP | :x: | :white_check_mark: | When set to `false`, source maps are not generated for a production build. This solves OOM issues on some smaller machines.
 NODE_PATH | :white_check_mark: |  :white_check_mark: | Same as [`NODE_PATH` in Node.js](https://nodejs.org/api/modules.html#modules_loading_from_the_global_folders), but only relative folders are allowed. Can be handy for emulating a monorepo setup by setting `NODE_PATH=src`.
 
diff --git a/tasks/e2e-simple.sh b/tasks/e2e-simple.sh
index 37e168dd7d2..3ae71fcb4c9 100755
--- a/tasks/e2e-simple.sh
+++ b/tasks/e2e-simple.sh
@@ -115,10 +115,6 @@ if [ $APPVEYOR != 'True' ]; then
 fi
 cd ../..
 
-cd packages/react-dev-utils/
-yarn test
-cd ../..
-
 cd packages/confusing-browser-globals/
 yarn test
 cd ../..