pytest cannot import module while python can

Question

I am working on a package in Python. I use virtualenv. I set the path to the root of the module in a .pth path in my virtualenv, so that I can import modules of the package while developing the code and do testing (Question 1: is it a good way to do?). This works fine (here is an example, this is the behavior I want):

(VEnvTestRc) zz@zz:~/Desktop/GitFolders/rc$ python
Python 2.7.12 (default, Jul  1 2016, 15:12:24) 
[GCC 5.4.0 20160609] on linux2
Type "help", "copyright", "credits" or "license" for more information.
>>> from rc import ns
>>> exit()
(VEnvTestRc) zz@zz:~/Desktop/GitFolders/rc$ python tests/test_ns.py 
issued command: echo hello
command output: hello

However, if I try to use PyTest, I get some import error messages:

(VEnvTestRc) zz@zz:~/Desktop/GitFolders/rc$ pytest
=========================================== test session starts ============================================
platform linux2 -- Python 2.7.12, pytest-3.0.5, py-1.4.31, pluggy-0.4.0
rootdir: /home/zz/Desktop/GitFolders/rc, inifile: 
collected 0 items / 1 errors 

================================================== ERRORS ==================================================
________________________________ ERROR collecting tests/test_ns.py ________________________________
ImportError while importing test module '/home/zz/Desktop/GitFolders/rc/tests/test_ns.py'.
Hint: make sure your test modules/packages have valid Python names.
Traceback:
tests/test_ns.py:2: in <module>
    from rc import ns
E   ImportError: cannot import name ns
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! Interrupted: 1 errors during collection !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
========================================= 1 error in 0.09 seconds ==========================================
(VEnvTestRc) zz@zz:~/Desktop/GitFolders/rc$ which pytest
/home/zz/Desktop/VirtualEnvs/VEnvTestRc/bin/pytest

I am a bit puzzled, it looks like this indicates an import error, but Python does it fine so why is there a problem specifically with PyTest? Any suggestion to the reason / remedy (Question 2)? I googled and stack-overflowed the 'ImportError: cannot import' error for PyTest, but the hits I got were related to missing python path and remedy to this, which does not seem to be the problem here. Any suggestions?

Answer 1

Found the answer:

DO NOT put a __init__.py file in a folder containing TESTS if you plan on using pytest. I had one such file, deleting it solved the problem.

This was actually buried in the comments to the second answer of PATH issue with pytest 'ImportError: No module named YadaYadaYada' so I did not see it, hope it gets more visibility here.