diff --git a/passes/hierarchy/hierarchy.cc b/passes/hierarchy/hierarchy.cc
index 6fcda5d7644..3ef04616fcb 100644
--- a/passes/hierarchy/hierarchy.cc
+++ b/passes/hierarchy/hierarchy.cc
@@ -47,7 +47,7 @@ void generate(RTLIL::Design *design, const std::vector<std::string> &celltypes,
 	{
 		if (design->module(cell->type) != nullptr)
 			continue;
-		if (cell->type.begins_with("$__"))
+		if (cell->type.begins_with("$") && !cell->type.begins_with("$__"))
 			continue;
 		for (auto &pattern : celltypes)
 			if (patmatch(pattern.c_str(), RTLIL::unescape_id(cell->type).c_str()))
diff --git a/tests/various/hierarchy_generate.ys b/tests/various/hierarchy_generate.ys
new file mode 100644
index 00000000000..a4dc87a865f
--- /dev/null
+++ b/tests/various/hierarchy_generate.ys
@@ -0,0 +1,19 @@
+read_verilog -icells <<EOF
+module top(input [2:0] a, input [2:0] b, output [2:0] y);
+
+sub sub_i (.a(a[0]), .b(b[0]), .y(y[0]));
+
+unknown_sub sub_ii (.a(a[1]), .b(b[1]), .y(y[1]));
+
+$__dunder_sub sub_iii (.a(a[2]), .b(b[2]), .y(y[2]));
+
+endmodule
+
+module sub(input a, input b, output y);
+    assign y = a ^ b;
+endmodule
+EOF
+hierarchy -generate unknown_sub i:a i:b o:y
+hierarchy -generate $__dunder_sub i:a i:b o:y
+hierarchy -top top -check
+check -assert