diff --git a/.ci/before_cache.sh b/.ci/before_cache.sh
index 8925da92f3..b5678bc20c 100755
--- a/.ci/before_cache.sh
+++ b/.ci/before_cache.sh
@@ -15,10 +15,8 @@ rm -f "${HOME}/.cache/pip/selfcheck.json"
 
 # Update the third-party dependency cache only if the build was successful.
 if [[ -f "${SUCCESS_MARKER}" ]]; then
-  if [[ ! -f "${CACHE_MARKER}" ]] || [[ "${BUILD_NVIM_DEPS}" == true ]]; then
-    echo "Updating third-party dependency cache."
-    rm -rf "${HOME}/.cache/nvim-deps"
-    mv -T "${DEPS_INSTALL_PREFIX}" "${HOME}/.cache/nvim-deps"
-    touch "${CACHE_MARKER}"
-  fi
+  rm -rf "${HOME}/.cache/nvim-deps"
+  mv -T "${DEPS_BUILD_DIR}" "${HOME}/.cache/nvim-deps"
+  touch "${CACHE_MARKER}"
+  echo "Updated third-party dependencies (timestamp: $(stat -c '%y' "${CACHE_MARKER}"))."
 fi
diff --git a/.ci/common/build.sh b/.ci/common/build.sh
index 34bba42af3..3d517b9b09 100644
--- a/.ci/common/build.sh
+++ b/.ci/common/build.sh
@@ -11,19 +11,21 @@ build_deps() {
     DEPS_CMAKE_FLAGS="${DEPS_CMAKE_FLAGS} ${CMAKE_FLAGS_MINGW}"
   fi
 
-  rm -rf "${DEPS_INSTALL_PREFIX}"
+  rm -rf "${DEPS_BUILD_DIR}"
 
   # If there is a valid cache and we're not forced to recompile,
   # use cached third-party dependencies.
   if [[ -f "${CACHE_MARKER}" ]] && [[ "${BUILD_NVIM_DEPS}" != true ]]; then
     echo "Using third-party dependencies from Travis's cache (last updated: $(stat -c '%y' "${CACHE_MARKER}"))."
 
-    mkdir -p "$(dirname "${DEPS_INSTALL_PREFIX}")"
-    ln -Ts "${HOME}/.cache/nvim-deps" "${DEPS_INSTALL_PREFIX}"
-    return
+     mkdir -p "$(dirname "${DEPS_BUILD_DIR}")"
+     mv -T "${HOME}/.cache/nvim-deps" "${DEPS_BUILD_DIR}"
+  else
+    mkdir -p "${DEPS_BUILD_DIR}"
   fi
 
-  mkdir -p "${DEPS_BUILD_DIR}"
+  # Even if we're using cached dependencies, run CMake and make to
+  # update CMake configuration and update to newer deps versions.
   cd "${DEPS_BUILD_DIR}"
   echo "Configuring with '${DEPS_CMAKE_FLAGS}'."
   cmake ${DEPS_CMAKE_FLAGS} "${TRAVIS_BUILD_DIR}/third-party/"
@@ -79,7 +81,7 @@ build_nvim() {
     exit 1
   fi
   asan_check "${LOG_DIR}"
-  
+
 
   cd "${TRAVIS_BUILD_DIR}"
 }
diff --git a/.travis.yml b/.travis.yml
index 5f88e209fc..bd2c9b3938 100644
--- a/.travis.yml
+++ b/.travis.yml
@@ -3,9 +3,7 @@ language: c
 
 env:
   global:
-    # To build third-party dependencies, set this to 'true'.
-    # TODO: Change deps caching to detect updated dependencies automatically, but
-    #       still don't rebuild deps every time.
+    # To force rebuilding of third-party dependencies, set this to 'true'.
     - BUILD_NVIM_DEPS=false
     # Travis has 1.5 virtual cores according to
     # http://docs.travis-ci.com/user/speeding-up-the-build/#Paralellizing-your-build-on-one-VM
@@ -19,9 +17,9 @@ env:
     # Build directory for Neovim.
     - BUILD_DIR="$TRAVIS_BUILD_DIR/build"
     # Build directory for third-party dependencies.
-    - DEPS_BUILD_DIR="$TRAVIS_BUILD_DIR/deps-build"
-    # Directory where compiled third-party dependencies are stored.
-    - DEPS_INSTALL_PREFIX="$HOME/nvim-deps-install"
+    - DEPS_BUILD_DIR="$HOME/nvim-deps"
+    # Directory where third-party dependency sources are downloaded to.
+    - DEPS_DOWNLOAD_DIR="$TRAVIS_BUILD_DIR/deps-downloads"
     # Install directory for Neovim.
     - INSTALL_PREFIX="$HOME/nvim-install"
     # Log directory for Clang sanitizers and Valgrind.
@@ -32,8 +30,8 @@ env:
                    -DCMAKE_INSTALL_PREFIX:PATH=$INSTALL_PREFIX
                    -DUSE_GCOV=ON
                    -DBUSTED_OUTPUT_TYPE=plainTerminal
-                   -DDEPS_PREFIX=$DEPS_INSTALL_PREFIX"
-    - DEPS_CMAKE_FLAGS="-DDEPS_INSTALL_DIR:PATH=$DEPS_INSTALL_PREFIX"
+                   -DDEPS_PREFIX=$DEPS_BUILD_DIR/usr"
+    - DEPS_CMAKE_FLAGS="-DDEPS_DOWNLOAD_DIR:PATH=$DEPS_DOWNLOAD_DIR"
     # Additional CMake flags for 32-bit builds.
     - CMAKE_FLAGS_32BIT="-DCMAKE_SYSTEM_LIBRARY_PATH=/lib32:/usr/lib32:/usr/local/lib32
                          -DCMAKE_IGNORE_PATH=/lib:/usr/lib:/usr/local/lib