diff --git a/data/io.elementary.code.gschema.xml b/data/io.elementary.code.gschema.xml
index f390b8b186..f51bd221ea 100644
--- a/data/io.elementary.code.gschema.xml
+++ b/data/io.elementary.code.gschema.xml
@@ -151,6 +151,11 @@
       <summary>Remember the last focused document.</summary>
       <description>Restore the focused document from a previous session when opening Code.</description>
     </key>
+    <key name="default-build-directory" type="s">
+      <default>''</default>
+      <summary>The default build directory's relative path.</summary>
+      <description>The directory, relative to the project root, at which to open the terminal pane and where to run build commands by default.</description>
+    </key>
     <key name="prefer-dark-style" type="b">
       <default>false</default>
       <summary>Request dark Gtk stylesheet variant</summary>
diff --git a/src/Dialogs/PreferencesDialog.vala b/src/Dialogs/PreferencesDialog.vala
index f5878982e6..eaacfe9226 100644
--- a/src/Dialogs/PreferencesDialog.vala
+++ b/src/Dialogs/PreferencesDialog.vala
@@ -49,7 +49,16 @@ namespace Scratch.Dialogs {
             var indent_width = new Gtk.SpinButton.with_range (1, 24, 1);
             Scratch.settings.bind ("indent-width", indent_width, "value", SettingsBindFlags.DEFAULT);
 
+            var buid_dir_label = new SettingsLabel (_("Default build directory"));
+            var build_dir_entry = new Gtk.Entry () {
+                placeholder_text = ".",
+                margin = 12,
+                halign = START
+            };
+
+            Scratch.settings.bind ("default-build-directory", build_dir_entry, "text", DEFAULT);
             var general_grid = new Gtk.Grid ();
+
             general_grid.column_spacing = 12;
             general_grid.row_spacing = 6;
             general_grid.attach (new Granite.HeaderLabel (_("General")), 0, 0, 3);
@@ -67,9 +76,13 @@ namespace Scratch.Dialogs {
             general_grid.attach (new SettingsSwitch ("strip-trailing-on-save"), 1, 6, 2);
             general_grid.attach (new SettingsLabel (_("Tab width:")), 0, 7);
             general_grid.attach (indent_width, 1, 7, 2);
+            general_grid.attach (new Granite.HeaderLabel (_("Projects")), 0, 8);
+            general_grid.attach (buid_dir_label, 0, 9);
+            general_grid.attach (build_dir_entry, 1, 9, 2);
 
             main_stack = new Gtk.Stack () {
-                margin = 12
+                margin = 12,
+                vhomogeneous = true
             };
             main_stack.add_titled (general_grid, "behavior", _("Behavior"));
             main_stack.add_titled (get_editor_box (), "interface", _("Interface"));
diff --git a/src/FolderManager/ProjectFolderItem.vala b/src/FolderManager/ProjectFolderItem.vala
index 60569b08f2..59396e0e60 100644
--- a/src/FolderManager/ProjectFolderItem.vala
+++ b/src/FolderManager/ProjectFolderItem.vala
@@ -120,9 +120,10 @@ namespace Scratch.FolderManager {
                _("Open in Terminal Pane"),
                 MainWindow.ACTION_PREFIX + MainWindow.ACTION_OPEN_IN_TERMINAL + "::"
             );
+
             var open_in_terminal_pane_item = new Gtk.MenuItem () {
                 action_name = MainWindow.ACTION_PREFIX + MainWindow.ACTION_OPEN_IN_TERMINAL,
-                action_target = new Variant.string (file.file.get_path ())
+                action_target = new Variant.string (Services.GitManager.get_instance ().get_default_build_dir (path))
             };
             open_in_terminal_pane_item.add (open_in_terminal_pane_label);
 
diff --git a/src/MainWindow.vala b/src/MainWindow.vala
index 220e3a07ef..f97d25d1b1 100644
--- a/src/MainWindow.vala
+++ b/src/MainWindow.vala
@@ -623,7 +623,8 @@ namespace Scratch {
                 folder_manager_view.collapse_other_projects ();
                 if (terminal.visible) {
                     var open_in_terminal_action = Utils.action_from_group (ACTION_OPEN_IN_TERMINAL, actions);
-                    open_in_terminal_action.activate (null);
+                    var param = new Variant.string (Services.GitManager.get_instance ().get_default_build_dir (null));
+                    open_in_terminal_action.activate (param);
                 }
             });
 
@@ -1308,9 +1309,9 @@ namespace Scratch {
                 toggle_terminal_action.activate (null);
             }
 
-            //If param is null or empty, the active project path is returned or failing that
+            //If param is null or empty, the active project path build dir is returned or failing that
             //the active document path
-            var target_path = get_target_path_for_actions (param);
+            var target_path = get_target_path_for_actions (param, true);
             terminal.change_location (target_path);
             terminal.terminal.grab_focus ();
         }
@@ -1341,7 +1342,7 @@ namespace Scratch {
             folder_manager_view.new_branch (get_target_path_for_actions (param));
         }
 
-        private string? get_target_path_for_actions (Variant? path_variant) {
+        private string? get_target_path_for_actions (Variant? path_variant, bool use_build_dir = false) {
              string? path = "";
              if (path_variant != null) {
                  path = path_variant.get_string ();
@@ -1349,6 +1350,10 @@ namespace Scratch {
 
              if (path == "") { // Happens when keyboard accelerator is used
                  path = git_manager.active_project_path;
+                 if (use_build_dir) {
+                     path = git_manager.get_default_build_dir (path);
+                 }
+
                  if (path == null) {
                      var current_doc = get_current_document ();
                      if (current_doc != null) {
diff --git a/src/Services/GitManager.vala b/src/Services/GitManager.vala
index 679e0e0c14..6001473cf4 100644
--- a/src/Services/GitManager.vala
+++ b/src/Services/GitManager.vala
@@ -98,5 +98,19 @@ namespace Scratch.Services {
                 project_gitrepo_map.unset (root_path);
             }
         }
+
+        // @project_path is the root of a project or null
+        public string get_default_build_dir (string? project_path) {
+            string build_path = project_path != null ? project_path : active_project_path;
+            var default_build_dir = Scratch.settings.get_string ("default-build-directory");
+            var build_file = GLib.File.new_for_path (Path.build_filename (build_path, default_build_dir));
+            if (build_file.query_exists ()) {
+                build_path = build_file.get_path ();
+            } else {
+                warning ("build path not found %s", build_file.get_path ());
+            }
+
+            return build_path;
+        }
     }
 }