diff --git a/README.md b/README.md
index 57b044c..f1dcf7d 100644
--- a/README.md
+++ b/README.md
@@ -58,14 +58,14 @@ One-time pads can be trivially encrypted and decrypted using pencil and paper, m
 
 ### Download Pre-Built Binaries
 
-**[Download Current Linux x86](https://git.laantungir.net/laantungir/otp/releases/download/v0.3.43/otp-v0.3.43-linux-x86_64)**
+**[Download Current Linux x86](https://git.laantungir.net/laantungir/otp/releases/download/v0.3.44/otp-v0.3.44-linux-x86_64)**
 
-**[Download Current Raspberry Pi 64](https://git.laantungir.net/laantungir/otp/releases/download/v0.3.43/otp-v0.3.43-linux-arm64)**
+**[Download Current Raspberry Pi 64](https://git.laantungir.net/laantungir/otp/releases/download/v0.3.44/otp-v0.3.44-linux-arm64)**
 
 After downloading:
 ```bash
 # Rename for convenience, then make executable
-mv otp-v0.3.43-linux-x86_64 otp
+mv otp-v0.3.44-linux-x86_64 otp
 chmod +x otp
 
 # Run it
diff --git a/src/main.h b/src/main.h
index 0812bff..1c4c22e 100644
--- a/src/main.h
+++ b/src/main.h
@@ -23,7 +23,7 @@
 #include <ctype.h>
 
 // Version - Updated automatically by build.sh
-#define OTP_VERSION "v0.3.43"
+#define OTP_VERSION "v0.3.44"
 
 // Constants
 #define MAX_INPUT_SIZE 4096
diff --git a/src/ui.c b/src/ui.c
index 28b89f4..36acaba 100644
--- a/src/ui.c
+++ b/src/ui.c
@@ -595,16 +595,23 @@ int handle_directory_encrypt(void) {
         return 1;
     }
 
-    // Generate default output filename
+    // Generate default output filename in the same directory as the source
     char default_output[1024];
     const char* dir_name = strrchr(dir_path, '/');
-    if (dir_name) {
-        dir_name++; // Skip the '/'
-    } else {
-        dir_name = dir_path;
-    }
     
-    snprintf(default_output, sizeof(default_output), "%s.tar.gz.otp", dir_name);
+    if (dir_name) {
+        // Has a path component - save in same directory
+        size_t parent_len = dir_name - dir_path;
+        char parent_dir[1024];
+        strncpy(parent_dir, dir_path, parent_len);
+        parent_dir[parent_len] = '\0';
+        
+        dir_name++; // Skip the '/'
+        snprintf(default_output, sizeof(default_output), "%s/%s.tar.gz.otp", parent_dir, dir_name);
+    } else {
+        // No path component - save in current directory
+        snprintf(default_output, sizeof(default_output), "%s.tar.gz.otp", dir_path);
+    }
 
     // Get output filename
     char output_file[512];