diff --git a/src/lib/chips/chips.scss b/src/lib/chips/chips.scss
index 541e9cc2bb13..f732f294fd48 100644
--- a/src/lib/chips/chips.scss
+++ b/src/lib/chips/chips.scss
@@ -7,6 +7,7 @@ $mat-chip-remove-margin-before: 6px;
 $mat-chip-remove-margin-after: -4px;
 
 $mat-chips-chip-margin: 8px;
+$mat-chips-chip-bottom-margin: 3px;
 
 $mat-chip-input-width: 150px;
 $mat-chip-input-margin: 3px;
@@ -28,10 +29,10 @@ $mat-chip-input-margin: 3px;
 
   // Apply a margin to adjacent sibling chips.
   & + & {
-    margin: 0 0 0 $mat-chips-chip-margin;
+    margin: 0 0 $mat-chips-chip-bottom-margin $mat-chips-chip-margin;
 
     [dir='rtl'] & {
-      margin: 0 $mat-chips-chip-margin 0 0;
+      margin: 0 $mat-chips-chip-margin $mat-chips-chip-bottom-margin 0;
     }
   }