diff --git a/lib/filelib.php b/lib/filelib.php
index 20112a00a5f..d2779ced516 100644
--- a/lib/filelib.php
+++ b/lib/filelib.php
@@ -4650,7 +4650,18 @@ function file_pluginfile($relativepath, $forcedownload, $preview = null, $offlin
             if (!plugin_supports('mod', $modname, FEATURE_MOD_INTRO, true)) {
                 send_file_not_found();
             }
-            require_course_login($course, true, $cm);
+
+            // Require login to the course first (without login to the module).
+            require_course_login($course, true);
+
+            // Now check if module is available OR it is restricted but the intro is shown on the course page.
+            $cminfo = cm_info::create($cm);
+            if (!$cminfo->uservisible) {
+                if (!$cm->showdescription || !$cminfo->is_visible_on_course_page()) {
+                    // Module intro is not visible on the course page and module is not available, show access error.
+                    require_course_login($course, true, $cminfo);
+                }
+            }
 
             // all users may access it
             $filename = array_pop($args);
diff --git a/mod/label/db/upgrade.php b/mod/label/db/upgrade.php
index 679da8db394..9ccf306dfa8 100644
--- a/mod/label/db/upgrade.php
+++ b/mod/label/db/upgrade.php
@@ -45,7 +45,7 @@
 defined('MOODLE_INTERNAL') || die;
 
 function xmldb_label_upgrade($oldversion) {
-    global $CFG;
+    global $CFG, $DB;
 
     // Moodle v3.1.0 release upgrade line.
     // Put any upgrade step following this.
@@ -56,5 +56,16 @@ function xmldb_label_upgrade($oldversion) {
     // Automatically generated Moodle v3.3.0 release upgrade line.
     // Put any upgrade step following this.
 
+    if ($oldversion < 2017062800) {
+        // Update all records in 'course_modules' for labels to have showdescription = 1.
+        if ($modid = $DB->get_field('modules', 'id', ['name' => 'label'])) {
+            $DB->execute("UPDATE {course_modules} SET showdescription = ? WHERE module = ?",
+                [1, $modid]);
+        }
+
+        // Label savepoint reached.
+        upgrade_mod_savepoint(true, 2017062800, 'label');
+    }
+
     return true;
 }
diff --git a/mod/label/mod_form.php b/mod/label/mod_form.php
index 7c54cb122bf..a892fd2fd00 100644
--- a/mod/label/mod_form.php
+++ b/mod/label/mod_form.php
@@ -36,6 +36,10 @@ class mod_label_mod_form extends moodleform_mod {
         $mform->addElement('header', 'generalhdr', get_string('general'));
         $this->standard_intro_elements(get_string('labeltext', 'label'));
 
+        // Label does not add "Show description" checkbox meaning that 'intro' is always shown on the course page.
+        $mform->addElement('hidden', 'showdescription', 1);
+        $mform->setType('showdescription', PARAM_INT);
+
         $this->standard_coursemodule_elements();
 
 //-------------------------------------------------------------------------------
diff --git a/mod/label/tests/generator/lib.php b/mod/label/tests/generator/lib.php
index 0ed413176bb..465305617ce 100644
--- a/mod/label/tests/generator/lib.php
+++ b/mod/label/tests/generator/lib.php
@@ -35,5 +35,10 @@ defined('MOODLE_INTERNAL') || die();
  * @license    http://www.gnu.org/copyleft/gpl.html GNU GPL v3 or later
  */
 class mod_label_generator extends testing_module_generator {
-    // No additional fields in label module.
+
+    public function create_instance($record = null, array $options = null) {
+        $record = (array)$record;
+        $record['showdescription'] = 1;
+        return parent::create_instance($record, $options);
+    }
 }
diff --git a/mod/label/version.php b/mod/label/version.php
index 6344e4bf7fb..cad0c0c95a1 100644
--- a/mod/label/version.php
+++ b/mod/label/version.php
@@ -24,7 +24,7 @@
 
 defined('MOODLE_INTERNAL') || die();
 
-$plugin->version   = 2017051500;       // The current module version (Date: YYYYMMDDXX)
+$plugin->version   = 2017062800;       // The current module version (Date: YYYYMMDDXX)
 $plugin->requires  = 2017050500;    // Requires this Moodle version
 $plugin->component = 'mod_label'; // Full name of the plugin (used for diagnostics)
 $plugin->cron      = 0;