diff --git a/apps/app/electron/main.js b/apps/app/electron/main.js
index ff3a5118..7ad6df20 100644
--- a/apps/app/electron/main.js
+++ b/apps/app/electron/main.js
@@ -144,11 +144,25 @@ async function startServer() {
     ? path.join(process.resourcesPath, "server", "node_modules")
     : path.join(__dirname, "../../server/node_modules");
 
+  // Set default workspace directory to user's Documents/Automaker
+  const defaultWorkspaceDir = path.join(app.getPath("documents"), "Automaker");
+
+  // Ensure workspace directory exists
+  if (!fs.existsSync(defaultWorkspaceDir)) {
+    try {
+      fs.mkdirSync(defaultWorkspaceDir, { recursive: true });
+      console.log("[Electron] Created workspace directory:", defaultWorkspaceDir);
+    } catch (error) {
+      console.error("[Electron] Failed to create workspace directory:", error);
+    }
+  }
+
   const env = {
     ...process.env,
     PORT: SERVER_PORT.toString(),
     DATA_DIR: app.getPath("userData"),
     NODE_PATH: serverNodeModules,
+    WORKSPACE_DIR: process.env.WORKSPACE_DIR || defaultWorkspaceDir,
   };
 
   console.log("[Electron] Starting backend server...");
diff --git a/apps/app/src/components/new-project-modal.tsx b/apps/app/src/components/new-project-modal.tsx
index fd1429de..2e54c8f4 100644
--- a/apps/app/src/components/new-project-modal.tsx
+++ b/apps/app/src/components/new-project-modal.tsx
@@ -198,7 +198,10 @@ export function NewProjectModal({
     }
   };
 
-  const projectPath = workspaceDir && projectName ? `${workspaceDir}/${projectName}` : "";
+  // Use platform-specific path separator
+  const pathSep = typeof window !== 'undefined' && (window as any).electronAPI ?
+    (navigator.platform.indexOf('Win') !== -1 ? '\\' : '/') : '/';
+  const projectPath = workspaceDir && projectName ? `${workspaceDir}${pathSep}${projectName}` : "";
 
   return (
     <Dialog open={open} onOpenChange={onOpenChange}>
diff --git a/apps/server/src/routes/templates.ts b/apps/server/src/routes/templates.ts
index a4f5504c..b3b62622 100644
--- a/apps/server/src/routes/templates.ts
+++ b/apps/server/src/routes/templates.ts
@@ -34,6 +34,8 @@ export function createTemplatesRoutes(): Router {
         return;
       }
 
+      console.log(`[Templates] Clone request - Repo: ${repoUrl}, Project: ${projectName}, Parent: ${parentDir}`);
+
       // Validate repo URL is a valid GitHub URL
       const githubUrlPattern = /^https:\/\/github\.com\/[\w-]+\/[\w.-]+$/;
       if (!githubUrlPattern.test(repoUrl)) {
@@ -79,12 +81,32 @@ export function createTemplatesRoutes(): Router {
 
       // Ensure parent directory exists
       try {
-        await fs.mkdir(parentDir, { recursive: true });
+        // Check if parentDir is a root path (Windows: C:\, D:\, etc. or Unix: /)
+        const isWindowsRoot = /^[A-Za-z]:\\?$/.test(parentDir);
+        const isUnixRoot = parentDir === '/' || parentDir === '';
+        const isRoot = isWindowsRoot || isUnixRoot;
+
+        if (isRoot) {
+          // Root paths always exist, just verify access
+          console.log(`[Templates] Using root path: ${parentDir}`);
+          await fs.access(parentDir);
+        } else {
+          // Check if parent directory exists
+          const parentExists = await fs.access(parentDir).then(() => true).catch(() => false);
+
+          if (!parentExists) {
+            console.log(`[Templates] Creating parent directory: ${parentDir}`);
+            await fs.mkdir(parentDir, { recursive: true });
+          } else {
+            console.log(`[Templates] Parent directory exists: ${parentDir}`);
+          }
+        }
       } catch (error) {
-        console.error("[Templates] Failed to create parent directory:", error);
+        const errorMessage = error instanceof Error ? error.message : String(error);
+        console.error("[Templates] Failed to access parent directory:", parentDir, error);
         res.status(500).json({
           success: false,
-          error: "Failed to create parent directory",
+          error: `Failed to access parent directory: ${errorMessage}`,
         });
         return;
       }