diff --git a/x-pack/tasks/build.js b/x-pack/tasks/build.js
index 0ccbbf082315..82ccc9c75bd6 100644
--- a/x-pack/tasks/build.js
+++ b/x-pack/tasks/build.js
@@ -4,20 +4,45 @@
  * you may not use this file except in compliance with the Elastic License.
  */
 
+import del from 'del';
 import { resolve } from 'path';
 import { writeFileSync } from 'fs';
 import pluginHelpers from '@kbn/plugin-helpers';
 import { ToolingLog } from '@kbn/dev-utils';
 import { generateNoticeFromSource } from '../../src/dev';
 
+async function moveFiles(gulp, src, dest) {
+  return new Promise((resolve, reject) => {
+    gulp.src(src)
+      .pipe(gulp.dest(dest))
+      .on('finish', resolve)
+      .on('error', reject);
+  });
+}
+
 export default (gulp, { buildTarget }) => {
   gulp.task('build', ['clean', 'report', 'prepare:build'], async () => {
+    const buildRoot = resolve(buildTarget, 'kibana/x-pack');
     await pluginHelpers.run('build', {
       skipArchive: true,
       buildDestination: buildTarget,
     });
 
-    const buildRoot = resolve(buildTarget, 'kibana/x-pack');
+    // NOTE: In order to prevent ending up with transpiled js files
+    // in the repository, we have set the outDir on x-pack tsconfig file
+    // to be the same as the intermediateBuildDirectory defined on the package.json
+    // As result of it, we need to move the transpiled js files for the correct folder
+    // and in the end deleting the generated outDir from the intermediateBuildDirectory.
+    //
+    //# TODO: This might be able to go away with the upgrade to babel 7
+    await moveFiles(
+      gulp,
+      resolve(buildRoot, 'x-pack/build/plugin/kibana/x-pack/**/!(*.test).js'),
+      buildRoot
+    );
+    await del(resolve(buildRoot, 'x-pack'));
+    //#
+
     const log = new ToolingLog({
       level: 'info',
       writeTo: process.stdout
diff --git a/x-pack/tsconfig.json b/x-pack/tsconfig.json
index febe406dc5d6..c74d60e90232 100644
--- a/x-pack/tsconfig.json
+++ b/x-pack/tsconfig.json
@@ -11,6 +11,7 @@
     "test/**/*"
   ],
   "compilerOptions": {
+    "outDir": ".",
     "paths": {
       "ui/*": [
         "src/legacy/ui/public/*"