From 8dd3f48c8a39ecb1e02461f104987df440563d1a Mon Sep 17 00:00:00 2001
From: akadeepesh <akadeepesh1710@gmail.com>
Date: Sun, 23 Aug 2026 03:03:34 +0530
Subject: [PATCH] feat: update workspace structure and improve gitignore
 handling

---
 .contextzip/.gitignore |  7 +++++++
 .gitignore             |  3 ---
 contextzip/config.py   |  2 +-
 contextzip/watcher.py  | 12 ++++++------
 4 files changed, 14 insertions(+), 10 deletions(-)
 create mode 100644 .contextzip/.gitignore

diff --git a/.contextzip/.gitignore b/.contextzip/.gitignore
new file mode 100644
index 0000000..8f41bff
--- /dev/null
+++ b/.contextzip/.gitignore
@@ -0,0 +1,7 @@
+# contextzip workspace
+# Everything here is a local, per-machine artifact except config.json,
+# which holds project-level contextzip preferences meant to be shared
+# with your team via Git.
+*
+!.gitignore
+!config.json
diff --git a/.gitignore b/.gitignore
index febc5f2..5ee9beb 100644
--- a/.gitignore
+++ b/.gitignore
@@ -36,8 +36,5 @@ desktop.ini
 # contextzip output files (don't commit test zips)
 *_context_*.zip
 
-# contextzip workspace
-.contextzip/
-
 # contextzip workspace
 exports/
diff --git a/contextzip/config.py b/contextzip/config.py
index 293f18f..dc31172 100644
--- a/contextzip/config.py
+++ b/contextzip/config.py
@@ -153,7 +153,7 @@ def config_path() -> Path:
 # now just output zips) gets created, when nothing more specific overrides
 # it. This is a *personal*, per-machine preference — for a setting the whole
 # team should share, use the project-level config instead (project_config.py,
-# a .contextzip.json file meant to be committed to the repo).
+# a .contextzip/config.json file meant to be committed to the repo).
 #
 # Resolution order (highest wins), enforced by packager.py, not here:
 #   CLI flag > CONTEXTZIP_WORKSPACE_LOCATION env var > project config
diff --git a/contextzip/watcher.py b/contextzip/watcher.py
index c4bd72a..80462ca 100644
--- a/contextzip/watcher.py
+++ b/contextzip/watcher.py
@@ -605,31 +605,31 @@ def _write_debug_zip(
     console: Console,
 ) -> Path | None:
     """
-    Write debug-context.zip to .contextzip/ workspace.
+    Write debug-context.zip to the .contextzip/output/ workspace.
 
     Structure (flat):
       prompt.txt
       terminal-error.txt
       source-files.zip    (inner zip with referenced source files)
     """
-    from contextzip.packager import _workspace_dir, _ensure_gitignore
+    from contextzip.packager import _workspace_dir, _ensure_workspace_gitignore
 
     workspace, is_git_repo = _workspace_dir(project_dir)
+    output_dir = workspace / "output"
 
     try:
-        workspace.mkdir(parents=True, exist_ok=True)
+        output_dir.mkdir(parents=True, exist_ok=True)
     except OSError as exc:
         console.print(f"[red]  ✗[/]  Could not create workspace: {exc}")
         return None
 
     if is_git_repo:
         try:
-            git_root = workspace.parent
-            _ensure_gitignore(git_root)
+            _ensure_workspace_gitignore(workspace)
         except OSError:
             pass
 
-    zip_path = workspace / "debug-context.zip"
+    zip_path = output_dir / "debug-context.zip"
 
     try:
         with zipfile.ZipFile(