diff --git a/src/lake/Lake/Build/Module.lean b/src/lake/Lake/Build/Module.lean
index 290a5b5c42..832f34f667 100644
--- a/src/lake/Lake/Build/Module.lean
+++ b/src/lake/Lake/Build/Module.lean
@@ -817,7 +817,7 @@ def Module.packLtar (self : Module) (arts : ModuleOutputArtifacts) : JobM Artifa
     return args
   proc (quiet := true) {cmd := (← getLeantar).toString, args}
   if (← self.pkg.isArtifactCacheWritable) then
-    cacheArtifact self.ltarFile "ltar" (← self.pkg.restoreAllArtifacts)
+    cacheArtifact self.ltarFile "ltar" (useLocalFile := ← self.pkg.restoreAllArtifacts)
   else
     computeArtifact self.ltarFile "ltar"
 
diff --git a/tests/lake/tests/ltar/restoreAll.toml b/tests/lake/tests/ltar/restoreAll.toml
new file mode 100644
index 0000000000..7f7b73f8c7
--- /dev/null
+++ b/tests/lake/tests/ltar/restoreAll.toml
@@ -0,0 +1,6 @@
+name = "test"
+enableArtifactCache = true
+restoreAllArtifacts = true
+
+[[lean_lib]]
+name = "Test"
diff --git a/tests/lake/tests/ltar/test.sh b/tests/lake/tests/ltar/test.sh
index d3bfcfc708..37d1a0609f 100755
--- a/tests/lake/tests/ltar/test.sh
+++ b/tests/lake/tests/ltar/test.sh
@@ -45,6 +45,15 @@ test_exp -f .lake/build/ir/Test.ltar
 rm -rf .lake/build .lake/cache/artifacts/*.[!l]*
 test_out "leantar" build +Test --no-build -v
 
+# Test caching an `ltar` through `-o` (with `restoreAllArtifacts = true`)
+# This tests caching the ltar from within `Module.packLtar`
+rm -rf .lake/cache .lake/build
+test_run -f restoreAll.toml build +Test -v --wfail
+test_exp ! -f .lake/build/ir/Test.ltar
+test_run -f restoreAll.toml build +Test -v --wfail -o .lake/outputs.jsonl
+test_cmd ls .lake/cache/artifacts/*.ltar
+test_exp -f .lake/build/ir/Test.ltar
+
 # Test producing an `ltar` without already restored artifacts
 rm -rf .lake/cache .lake/build
 LAKE_ARTIFACT_CACHE=true test_run build +Test -v