.htaccess does not execute in subdirectories? - .htaccess

Question

I am trying to achieve the following redirect:
http://localhost/api/user/list?limit=10
to
http://localhost/api/index.php/user/list?limit=10
My .htaccess file works fine according to https://htaccess.madewithlove.com/, but when I test it, I get a 404 Not Found error.
What I have tried
In my .htaccess file I included a rule that sets a header. This way, I can check with postman whether or not the rule has been executed.
When I send a GET request to http://localhost/api, I see my "TEST_FOOBAR" header in the response. However, when I send a GET request to http://localhost/api/user, the header is no longer there.
However, when I send a request to http://localhost/api/inc (an existing folder), I do get to see my header.
This makes me believe that my .htaccess only listens to and rewrites requests that are being sent to http://localhost/api, and not its "virtual" subfolders.
I've been googling for a while but can't seem to figure out why it's not rewriting calls to "virtual" subdirectories?
Here is my .htaccess file:
RewriteEngine On
RewriteRule ^api(.*)$ /api/index.php$1
Header set TEST_FOOBAR "oi"

Answer 1

RewriteRule ^api(.*)$ /api/index.php$1
By itself, this looks like it would result in a rewrite-loop, since the target URL /api/index.php... is also matched by the RewriteRule pattern ^api(.*)$, so a request for /api/user would be rewritten as follows:
/api/user to /api/index.php/user
/api/index.php/user to /api/index.php/index.php/user
Try the following instead, to prevent the rewritten request being further rewritten:
RewriteCond %{ENV:REDIRECT_STATUS} ^$
RewriteRule ^api(/.*)$ /api/index.php$1 [L]
There must always be a slash after api (for the substitution to be valid), so I've included this in the capturing group.
The check against the REDIRECT_STATUS env var ensures that only the initial request is processed and not the rewritten request. I used this method, as opposed to explicitly checking for /api/index.php since it allows direct requests to /api/index.php to be handled by your API and processed accordingly (perhaps even rejecting the request).
In my .htaccess file I included a rule that sets a header. This way, I can check with postman whether or not the rule has been executed.
This doesn't necessarily tell you whether the RewriteRule directive has been successfully processed or not. Different Apache modules are processed entirely independently, and at different times during the request. If the header is not set then it just means that the Header directive was not processed successfully (perhaps due to an error).
When I send a GET request to http://localhost/api
Since /api is a physical subdirectory, if you request /api without a trailing slash then mod_dir should ultimately 301 redirect the request to /api/ (appending the trailing slash). Your test header should not be set on the redirect response (since you are not using the always condition on the Header directive).
My .htaccess file works fine according to htaccess.madewithlove.com
The MWL tester only simulates a single pass by the rewrite engine so cannot detect rewrite/redirect-loops. On a real server the rewrite engine loops until the URL passes through unchanged or encounters an END flag (Apache 2.4). (The L flag simply stops the current pass by the rewrite engine, triggering the rewrite engine to begin another pass.)
In the above rule you could use the END flag (instead of L) which would negate the need for the preceding condition.