diff --git a/builtin/pack-objects.c b/builtin/pack-objects.c
index 0ea85754c52..d4e05ca4434 100644
--- a/builtin/pack-objects.c
+++ b/builtin/pack-objects.c
@@ -3236,6 +3236,51 @@ static int should_attempt_deltas(struct object_entry *entry)
 	return 1;
 }
 
+static void find_deltas_for_region(struct object_entry *list,
+				   struct packing_region *region,
+				   unsigned int *processed)
+{
+	struct object_entry **delta_list;
+	uint32_t delta_list_nr = 0;
+
+	ALLOC_ARRAY(delta_list, region->nr);
+	for (uint32_t i = 0; i < region->nr; i++) {
+		struct object_entry *entry = list + region->start + i;
+		if (should_attempt_deltas(entry))
+			delta_list[delta_list_nr++] = entry;
+	}
+
+	QSORT(delta_list, delta_list_nr, type_size_sort);
+	find_deltas(delta_list, &delta_list_nr, window, depth, processed);
+	free(delta_list);
+}
+
+static void find_deltas_by_region(struct object_entry *list,
+				  struct packing_region *regions,
+				  uint32_t start, uint32_t nr)
+{
+	unsigned int processed = 0;
+	uint32_t progress_nr;
+
+	if (!nr)
+		return;
+
+	progress_nr = regions[nr - 1].start + regions[nr - 1].nr;
+
+	if (progress)
+		progress_state = start_progress(the_repository,
+						_("Compressing objects by path"),
+						progress_nr);
+
+	while (nr--)
+		find_deltas_for_region(list,
+				       &regions[start++],
+				       &processed);
+
+	display_progress(progress_state, progress_nr);
+	stop_progress(&progress_state);
+}
+
 static void prepare_pack(int window, int depth)
 {
 	struct object_entry **delta_list;
@@ -3260,6 +3305,10 @@ static void prepare_pack(int window, int depth)
 	if (!to_pack.nr_objects || !window || !depth)
 		return;
 
+	if (path_walk)
+		find_deltas_by_region(to_pack.objects, to_pack.regions,
+				      0, to_pack.nr_regions);
+
 	ALLOC_ARRAY(delta_list, to_pack.nr_objects);
 	nr_deltas = n = 0;
 
@@ -4213,10 +4262,8 @@ static int add_objects_by_path(const char *path,
 			       enum object_type type,
 			       void *data)
 {
-	struct object_entry **delta_list;
 	size_t oe_start = to_pack.nr_objects;
 	size_t oe_end;
-	unsigned int sub_list_size;
 	unsigned int *processed = data;
 
 	/*
@@ -4249,32 +4296,17 @@ static int add_objects_by_path(const char *path,
 	if (oe_end == oe_start || !window)
 		return 0;
 
-	sub_list_size = 0;
-	ALLOC_ARRAY(delta_list, oe_end - oe_start);
-
-	for (size_t i = 0; i < oe_end - oe_start; i++) {
-		struct object_entry *entry = to_pack.objects + oe_start + i;
+	ALLOC_GROW(to_pack.regions,
+		   to_pack.nr_regions + 1,
+		   to_pack.nr_regions_alloc);
 
-		if (!should_attempt_deltas(entry))
-			continue;
-
-		delta_list[sub_list_size++] = entry;
-	}
+	to_pack.regions[to_pack.nr_regions].start = oe_start;
+	to_pack.regions[to_pack.nr_regions].nr = oe_end - oe_start;
+	to_pack.nr_regions++;
 
-	/*
-	 * Find delta bases among this list of objects that all match the same
-	 * path. This causes the delta compression to be interleaved in the
-	 * object walk, which can lead to confusing progress indicators. This is
-	 * also incompatible with threaded delta calculations. In the future,
-	 * consider creating a list of regions in the full to_pack.objects array
-	 * that could be picked up by the threaded delta computation.
-	 */
-	if (sub_list_size && window) {
-		QSORT(delta_list, sub_list_size, type_size_sort);
-		find_deltas(delta_list, &sub_list_size, window, depth, processed);
-	}
+	*processed += oids->nr;
+	display_progress(progress_state, *processed);
 
-	free(delta_list);
 	return 0;
 }
 
diff --git a/pack-objects.h b/pack-objects.h
index d73e3843c92..7ba9f3448fe 100644
--- a/pack-objects.h
+++ b/pack-objects.h
@@ -119,11 +119,23 @@ struct object_entry {
 	unsigned ext_base:1; /* delta_idx points outside packlist */
 };
 
+/**
+ * A packing region is a section of the packing_data.objects array
+ * as given by a starting index and a number of elements.
+ */
+struct packing_region {
+	uint32_t start;
+	uint32_t nr;
+};
+
 struct packing_data {
 	struct repository *repo;
 	struct object_entry *objects;
 	uint32_t nr_objects, nr_alloc;
 
+	struct packing_region *regions;
+	uint64_t nr_regions, nr_regions_alloc;
+
 	int32_t *index;
 	uint32_t index_size;
 
diff --git a/t/t5300-pack-object.sh b/t/t5300-pack-object.sh
index 16420d12863..c8df6afd784 100755
--- a/t/t5300-pack-object.sh
+++ b/t/t5300-pack-object.sh
@@ -725,7 +725,9 @@ test_expect_success '--name-hash-version=2 and --write-bitmap-index are incompat
 
 test_expect_success '--path-walk pack everything' '
 	git -C server rev-parse HEAD >in &&
-	git -C server pack-objects --stdout --revs --path-walk <in >out.pack &&
+	GIT_PROGRESS_DELAY=0 git -C server pack-objects \
+		--stdout --revs --path-walk --progress <in >out.pack 2>err &&
+	grep "Compressing objects by path" err &&
 	git -C server index-pack --stdin <out.pack
 '
 
@@ -734,7 +736,9 @@ test_expect_success '--path-walk thin pack' '
 	$(git -C server rev-parse HEAD)
 	^$(git -C server rev-parse HEAD~2)
 	EOF
-	git -C server pack-objects --thin --stdout --revs --path-walk <in >out.pack &&
+	GIT_PROGRESS_DELAY=0 git -C server pack-objects \
+		--thin --stdout --revs --path-walk --progress <in >out.pack 2>err &&
+	grep "Compressing objects by path" err &&
 	git -C server index-pack --fix-thin --stdin <out.pack
 '
 
diff --git a/t/t5530-upload-pack-error.sh b/t/t5530-upload-pack-error.sh
index 8eb6fea839a..558eedf25a4 100755
--- a/t/t5530-upload-pack-error.sh
+++ b/t/t5530-upload-pack-error.sh
@@ -34,12 +34,6 @@ test_expect_success 'upload-pack fails due to error in pack-objects packing' '
 	hexsz=$(test_oid hexsz) &&
 	printf "%04xwant %s\n00000009done\n0000" \
 		$(($hexsz + 10)) $head >input &&
-
-	# The current implementation of path-walk causes a different
-	# error message. This will be changed by a future refactoring.
-	GIT_TEST_PACK_PATH_WALK=0 &&
-	export GIT_TEST_PACK_PATH_WALK &&
-
 	test_must_fail git upload-pack . <input >/dev/null 2>output.err &&
 	test_grep "unable to read" output.err &&
 	test_grep "pack-objects died" output.err
