diff --git a/change/react-native-windows-2020-03-31-20-25-48-FixNewProjectBuild.json b/change/react-native-windows-2020-03-31-20-25-48-FixNewProjectBuild.json
new file mode 100644
index 00000000000..e12f7359153
--- /dev/null
+++ b/change/react-native-windows-2020-03-31-20-25-48-FixNewProjectBuild.json
@@ -0,0 +1,8 @@
+{
+  "type": "prerelease",
+  "comment": "Set $(ReactNativeWindowsDir) before it is used",
+  "packageName": "react-native-windows",
+  "email": "vmorozov@microsoft.com",
+  "dependentChangeType": "patch",
+  "date": "2020-04-01T03:25:48.573Z"
+}
\ No newline at end of file
diff --git a/vnext/Directory.Build.props b/vnext/Directory.Build.props
index 87b6500ca8b..d2a7137eea2 100644
--- a/vnext/Directory.Build.props
+++ b/vnext/Directory.Build.props
@@ -13,6 +13,9 @@
 
   </PropertyGroup>
 
+  <!-- Initialize $(ReactNativeWindowsDir) before it is used below. -->
+  <Import Project="PropertySheets\ReactPackageDirectories.props" />
+
   <PropertyGroup Label="Configuration">
     <ProjectName Condition="'$(ProjectName)'==''">$(MSBuildProjectName)</ProjectName>
     <!-- Visual Studio forces using 'Win32' for the 'x86' platform. -->