diff --git a/t/t1011-read-tree-sparse-checkout.sh b/t/t1011-read-tree-sparse-checkout.sh
index eb44bafb59..63223e13bd 100755
--- a/t/t1011-read-tree-sparse-checkout.sh
+++ b/t/t1011-read-tree-sparse-checkout.sh
@@ -233,18 +233,19 @@ test_expect_success 'read-tree --reset removes outside worktree' '
 	test_must_be_empty result
 '
 
-test_expect_success 'print errors when failed to update worktree' '
+test_expect_success 'print warnings when some worktree updates disabled' '
 	echo sub >.git/info/sparse-checkout &&
 	git checkout -f init &&
 	mkdir sub &&
 	touch sub/added sub/addedtoo &&
-	test_must_fail git checkout top 2>actual &&
+	# Use -q to suppress "Previous HEAD position" and "Head is now at" msgs
+	git checkout -q top 2>actual &&
 	cat >expected <<\EOF &&
-error: The following untracked working tree files would be overwritten by checkout:
+warning: The following paths were already present and thus not updated despite sparse patterns:
 	sub/added
 	sub/addedtoo
-Please move or remove them before you switch branches.
-Aborting
+
+After fixing the above paths, you may want to run `git sparse-checkout reapply`.
 EOF
 	test_i18ncmp expected actual
 '
diff --git a/t/t2018-checkout-branch.sh b/t/t2018-checkout-branch.sh
index bbca7ef8da..21583154d8 100755
--- a/t/t2018-checkout-branch.sh
+++ b/t/t2018-checkout-branch.sh
@@ -238,4 +238,26 @@ test_expect_success 'checkout -b after clone --no-checkout does a checkout of HE
 	test_path_is_file dest/a.t
 '
 
+test_expect_success 'checkout -b to a new branch preserves mergeable changes despite sparse-checkout' '
+	test_when_finished "
+		git reset --hard &&
+		git checkout branch1-scratch &&
+		test_might_fail git branch -D branch3 &&
+		git config core.sparseCheckout false &&
+		rm .git/info/sparse-checkout" &&
+
+	test_commit file2 &&
+
+	echo stuff >>file1 &&
+	echo file2 >.git/info/sparse-checkout &&
+	git config core.sparseCheckout true &&
+
+	CURHEAD=$(git rev-parse HEAD) &&
+	do_checkout branch3 $CURHEAD &&
+
+	echo file1 >expect &&
+	git diff --name-only >actual &&
+	test_cmp expect actual
+'
+
 test_done
diff --git a/unpack-trees.c b/unpack-trees.c
index dec044339d..b43f3e775a 100644
--- a/unpack-trees.c
+++ b/unpack-trees.c
@@ -1701,23 +1701,15 @@ int unpack_trees(unsigned len, struct tree_desc *t, struct unpack_trees_options
 			 * correct CE_NEW_SKIP_WORKTREE
 			 */
 			if (ce->ce_flags & CE_ADDED &&
-			    verify_absent(ce, ERROR_WOULD_LOSE_UNTRACKED_OVERWRITTEN, o)) {
-				if (!o->show_all_errors)
-					goto return_failed;
-				ret = -1;
-			}
+			    verify_absent(ce, WARNING_SPARSE_ORPHANED_NOT_OVERWRITTEN, o))
+				ret = 1;
+
+			if (apply_sparse_checkout(&o->result, ce, o))
+				ret = 1;
 
-			if (apply_sparse_checkout(&o->result, ce, o)) {
-				if (!o->show_all_errors)
-					goto return_failed;
-				ret = -1;
-			}
 			if (!ce_skip_worktree(ce))
 				empty_worktree = 0;
-
 		}
-		if (ret < 0)
-			goto return_failed;
 		/*
 		 * Sparse checkout is meant to narrow down checkout area
 		 * but it does not make sense to narrow down to empty working
@@ -1728,6 +1720,15 @@ int unpack_trees(unsigned len, struct tree_desc *t, struct unpack_trees_options
 			ret = unpack_failed(o, "Sparse checkout leaves no entry on working directory");
 			goto done;
 		}
+		if (ret == 1) {
+			/*
+			 * Inability to sparsify or de-sparsify individual
+			 * paths is not an error, but just a warning.
+			 */
+			if (o->show_all_errors)
+				display_warning_msgs(o);
+			ret = 0;
+		}
 	}
 
 	ret = check_updates(o, &o->result) ? (-2) : 0;
@@ -1759,10 +1760,8 @@ done:
 	return ret;
 
 return_failed:
-	if (o->show_all_errors) {
+	if (o->show_all_errors)
 		display_error_msgs(o);
-		display_warning_msgs(o);
-	}
 	mark_all_ce_unused(o->src_index);
 	ret = unpack_failed(o, NULL);
 	if (o->exiting_early)