diff --git a/tools/serve/serve.py b/tools/serve/serve.py
index 3086a231402403..73810ce88ee0f0 100644
--- a/tools/serve/serve.py
+++ b/tools/serve/serve.py
@@ -702,8 +702,14 @@ def build_config(override_path=None, **kwargs):
 
     return rv
 
-def _make_subdomains_product(s, depth=3):
-    return set(u".".join(x) for x in chain(*(product(s, repeat=i) for i in range(1, depth+1))))
+def _make_subdomains_product(s):
+    # A "depth" of 2 satisfies the original feature request: the availability
+    # of "a subdomain of a subdomain (and another subdomain of the same
+    # subdomain)
+    # https://github.com/web-platform-tests/wpt/issues/8581
+    depth = 2
+
+    return set(u".".join(x) for x in chain(*(product(s, repeat=i) for i in range(1, depth + 1))))
 
 _subdomains = {u"www",
                u"www1",
@@ -713,10 +719,6 @@ def _make_subdomains_product(s, depth=3):
 
 _not_subdomains = {u"nonexistent"}
 
-_subdomains = _make_subdomains_product(_subdomains)
-
-_not_subdomains = _make_subdomains_product(_not_subdomains)
-
 
 class ConfigBuilder(config.ConfigBuilder):
     """serve config
@@ -763,8 +765,12 @@ class ConfigBuilder(config.ConfigBuilder):
     def __init__(self, *args, **kwargs):
         if "subdomains" not in kwargs:
             kwargs["subdomains"] = _subdomains
+        kwargs["subdomains"] = _make_subdomains_product(kwargs["subdomains"])
+
         if "not_subdomains" not in kwargs:
             kwargs["not_subdomains"] = _not_subdomains
+        kwargs["not_subdomains"] = _make_subdomains_product(kwargs["not_subdomains"])
+
         super(ConfigBuilder, self).__init__(
             *args,
             **kwargs
diff --git a/tools/serve/test_serve.py b/tools/serve/test_serve.py
index e939c3a0ccee4a..f8d2cd69adab49 100644
--- a/tools/serve/test_serve.py
+++ b/tools/serve/test_serve.py
@@ -23,9 +23,17 @@ def test_make_hosts_file_nix():
                               "192.168.42.42\tfoo.bar",
                               "192.168.42.42\tfoo2.bar",
                               "192.168.42.42\ta.foo.bar",
+                              "192.168.42.42\ta.a.foo.bar",
+                              "192.168.42.42\ta.b.foo.bar",
                               "192.168.42.42\ta.foo2.bar",
+                              "192.168.42.42\ta.a.foo2.bar",
+                              "192.168.42.42\ta.b.foo2.bar",
                               "192.168.42.42\tb.foo.bar",
-                              "192.168.42.42\tb.foo2.bar"}
+                              "192.168.42.42\tb.a.foo.bar",
+                              "192.168.42.42\tb.b.foo.bar",
+                              "192.168.42.42\tb.foo2.bar",
+                              "192.168.42.42\tb.a.foo2.bar",
+                              "192.168.42.42\tb.b.foo2.bar"}
         assert lines[-1] == ""
 
 @pytest.mark.skipif(platform.uname()[0] != "Windows",
@@ -35,20 +43,36 @@ def test_make_hosts_file_windows():
                        browser_host="foo.bar",
                        alternate_hosts={"alt": "foo2.bar"},
                        subdomains={"a", "b"},
-                       not_subdomains={"x, y"}) as c:
+                       not_subdomains={"x", "y"}) as c:
         hosts = serve.make_hosts_file(c, "192.168.42.42")
         lines = hosts.split("\n")
         assert set(lines) == {"",
                               "0.0.0.0\tx.foo.bar",
+                              "0.0.0.0\tx.x.foo.bar",
+                              "0.0.0.0\tx.y.foo.bar",
                               "0.0.0.0\tx.foo2.bar",
+                              "0.0.0.0\tx.x.foo2.bar",
+                              "0.0.0.0\tx.y.foo2.bar",
                               "0.0.0.0\ty.foo.bar",
+                              "0.0.0.0\ty.x.foo.bar",
+                              "0.0.0.0\ty.y.foo.bar",
                               "0.0.0.0\ty.foo2.bar",
+                              "0.0.0.0\ty.x.foo2.bar",
+                              "0.0.0.0\ty.y.foo2.bar",
                               "192.168.42.42\tfoo.bar",
                               "192.168.42.42\tfoo2.bar",
                               "192.168.42.42\ta.foo.bar",
+                              "192.168.42.42\ta.a.foo.bar",
+                              "192.168.42.42\ta.b.foo.bar",
                               "192.168.42.42\ta.foo2.bar",
+                              "192.168.42.42\ta.a.foo2.bar",
+                              "192.168.42.42\ta.b.foo2.bar",
                               "192.168.42.42\tb.foo.bar",
-                              "192.168.42.42\tb.foo2.bar"}
+                              "192.168.42.42\tb.a.foo.bar",
+                              "192.168.42.42\tb.b.foo.bar",
+                              "192.168.42.42\tb.foo2.bar",
+                              "192.168.42.42\tb.a.foo2.bar",
+                              "192.168.42.42\tb.b.foo2.bar"}
         assert lines[-1] == ""