diff --git a/README.md b/README.md
index f1dcf7d..29c4788 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/v0.3.44/otp-v0.3.44-linux-x86_64)**
+**[Download Current Linux x86](https://git.laantungir.net/laantungir/otp/releases/download/v0.3.45/otp-v0.3.45-linux-x86_64)**
 
-**[Download Current Raspberry Pi 64](https://git.laantungir.net/laantungir/otp/releases/download/v0.3.44/otp-v0.3.44-linux-arm64)**
+**[Download Current Raspberry Pi 64](https://git.laantungir.net/laantungir/otp/releases/download/v0.3.45/otp-v0.3.45-linux-arm64)**
 
 After downloading:
 ```bash
 # Rename for convenience, then make executable
-mv otp-v0.3.44-linux-x86_64 otp
+mv otp-v0.3.45-linux-x86_64 otp
 chmod +x otp
 
 # Run it
diff --git a/src/main.h b/src/main.h
index 1c4c22e..828dffb 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 "v0.3.44"
+#define OTP_VERSION "v0.3.45"
 
 // Constants
 #define MAX_INPUT_SIZE 4096
diff --git a/src/ui.c b/src/ui.c
index 36acaba..9d302eb 100644
--- a/src/ui.c
+++ b/src/ui.c
@@ -334,7 +334,15 @@ int handle_decrypt_menu(void) {
         temp_default[sizeof(temp_default) - 1] = '\0';
 
         // Remove common encrypted extensions to get a better default
-        if (strstr(temp_default, ".otp.asc")) {
+        if (strstr(temp_default, ".tar.gz.otp")) {
+            // Directory archive - remove .tar.gz.otp to get original directory name
+            char* ext_pos = strstr(temp_default, ".tar.gz.otp");
+            *ext_pos = '\0';
+        } else if (strstr(temp_default, ".tar.otp")) {
+            // Directory archive without compression - remove .tar.otp
+            char* ext_pos = strstr(temp_default, ".tar.otp");
+            *ext_pos = '\0';
+        } else if (strstr(temp_default, ".otp.asc")) {
             // Replace .otp.asc with original extension or no extension
             char* ext_pos = strstr(temp_default, ".otp.asc");
             *ext_pos = '\0';
@@ -402,7 +410,15 @@ int handle_decrypt_menu(void) {
             temp_default[sizeof(temp_default) - 1] = '\0';
 
             // Remove common encrypted extensions to get a better default
-            if (strstr(temp_default, ".otp.asc")) {
+            if (strstr(temp_default, ".tar.gz.otp")) {
+                // Directory archive - remove .tar.gz.otp to get original directory name
+                char* ext_pos = strstr(temp_default, ".tar.gz.otp");
+                *ext_pos = '\0';
+            } else if (strstr(temp_default, ".tar.otp")) {
+                // Directory archive without compression - remove .tar.otp
+                char* ext_pos = strstr(temp_default, ".tar.otp");
+                *ext_pos = '\0';
+            } else if (strstr(temp_default, ".otp.asc")) {
                 // Replace .otp.asc with original extension or no extension
                 char* ext_pos = strstr(temp_default, ".otp.asc");
                 *ext_pos = '\0';
@@ -595,23 +611,9 @@ int handle_directory_encrypt(void) {
         return 1;
     }
 
-    // Generate default output filename in the same directory as the source
+    // Generate default output filename - append .tar.gz.otp to the directory path
     char default_output[1024];
-    const char* dir_name = strrchr(dir_path, '/');
-    
-    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);
-    }
+    snprintf(default_output, sizeof(default_output), "%s.tar.gz.otp", dir_path);
 
     // Get output filename
     char output_file[512];