diff --git a/builtin-log.c b/builtin-log.c
index db71e0d..16a0f11 100644
--- a/builtin-log.c
+++ b/builtin-log.c
@@ -568,6 +568,7 @@
 
 static FILE *realstdout = NULL;
 static const char *output_directory = NULL;
+static int outdir_offset;
 
 static int reopen_stdout(const char *oneline, int nr, int total)
 {
@@ -594,7 +595,7 @@
 		strcpy(filename + len, fmt_patch_suffix);
 	}
 
-	fprintf(realstdout, "%s\n", filename);
+	fprintf(realstdout, "%s\n", filename + outdir_offset);
 	if (freopen(filename, "w", stdout) == NULL)
 		return error("Cannot open patch file %s",filename);
 
@@ -757,6 +758,27 @@
 	return xmemdupz(a, z - a);
 }
 
+static const char *set_outdir(const char *prefix, const char *output_directory)
+{
+	if (output_directory && is_absolute_path(output_directory))
+		return output_directory;
+
+	if (!prefix || !*prefix) {
+		if (output_directory)
+			return output_directory;
+		/* The user did not explicitly ask for "./" */
+		outdir_offset = 2;
+		return "./";
+	}
+
+	outdir_offset = strlen(prefix);
+	if (!output_directory)
+		return prefix;
+
+	return xstrdup(prefix_filename(prefix, outdir_offset,
+				       output_directory));
+}
+
 int cmd_format_patch(int argc, const char **argv, const char *prefix)
 {
 	struct commit *commit;
@@ -935,8 +957,8 @@
 	if (!DIFF_OPT_TST(&rev.diffopt, TEXT) && !no_binary_diff)
 		DIFF_OPT_SET(&rev.diffopt, BINARY);
 
-	if (!output_directory && !use_stdout)
-		output_directory = prefix;
+	if (!use_stdout)
+		output_directory = set_outdir(prefix, output_directory);
 
 	if (output_directory) {
 		if (use_stdout)
diff --git a/t/t4014-format-patch.sh b/t/t4014-format-patch.sh
index 7fe853c..16de436 100755
--- a/t/t4014-format-patch.sh
+++ b/t/t4014-format-patch.sh
@@ -3,7 +3,7 @@
 # Copyright (c) 2006 Junio C Hamano
 #
 
-test_description='Format-patch skipping already incorporated patches'
+test_description='various format-patch tests'
 
 . ./test-lib.sh
 
@@ -230,4 +230,54 @@
 
 '
 
+test_expect_success 'format-patch from a subdirectory (1)' '
+	filename=$(
+		rm -rf sub &&
+		mkdir -p sub/dir &&
+		cd sub/dir &&
+		git format-patch -1
+	) &&
+	case "$filename" in
+	0*)
+		;; # ok
+	*)
+		echo "Oops? $filename"
+		false
+		;;
+	esac &&
+	test -f "$filename"
+'
+
+test_expect_success 'format-patch from a subdirectory (2)' '
+	filename=$(
+		rm -rf sub &&
+		mkdir -p sub/dir &&
+		cd sub/dir &&
+		git format-patch -1 -o ..
+	) &&
+	case "$filename" in
+	../0*)
+		;; # ok
+	*)
+		echo "Oops? $filename"
+		false
+		;;
+	esac &&
+	basename=$(expr "$filename" : ".*/\(.*\)") &&
+	test -f "sub/$basename"
+'
+
+test_expect_success 'format-patch from a subdirectory (3)' '
+	here="$TEST_DIRECTORY/$test" &&
+	rm -f 0* &&
+	filename=$(
+		rm -rf sub &&
+		mkdir -p sub/dir &&
+		cd sub/dir &&
+		git format-patch -1 -o "$here"
+	) &&
+	basename=$(expr "$filename" : ".*/\(.*\)") &&
+	test -f "$basename"
+'
+
 test_done