diff --git a/lib/compass/commands/create_project.rb b/lib/compass/commands/create_project.rb
index ad3ef3d0..e768b2f4 100644
--- a/lib/compass/commands/create_project.rb
+++ b/lib/compass/commands/create_project.rb
@@ -17,11 +17,13 @@ module Compass
       # all commands must implement perform
       def perform
         directory nil, options
-        directory 'stylesheets', options.merge(:force => true)
-        directory 'src', options.merge(:force => true)
-        template 'project/screen.sass', 'src/screen.sass', options
-        template 'project/print.sass',  'src/print.sass', options
-        template 'project/ie.sass',     'src/ie.sass', options
+        src_dir = options[:src_dir] || "src"
+        css_dir = options[:css_dir] || "stylesheets"
+        directory src_dir, options.merge(:force => true)
+        directory css_dir, options.merge(:force => true)
+        template 'project/screen.sass', "#{src_dir}/screen.sass", options
+        template 'project/print.sass',  "#{src_dir}/print.sass", options
+        template 'project/ie.sass',     "#{src_dir}/ie.sass", options
         UpdateProject.new(working_directory, options).perform
       end
 
diff --git a/lib/compass/commands/update_project.rb b/lib/compass/commands/update_project.rb
index c256c677..d5f935dd 100644
--- a/lib/compass/commands/update_project.rb
+++ b/lib/compass/commands/update_project.rb
@@ -11,7 +11,7 @@ module Compass
       Base::ACTIONS << :compile
       Base::ACTIONS << :overwrite
 
-      attr_accessor :project_directory, :project_name, :options
+      attr_accessor :project_directory, :project_name, :options, :project_src_subdirectory, :project_css_subdirectory
 
       def initialize(working_directory, options = {})
         super(working_directory, options)
@@ -36,9 +36,9 @@ module Compass
       end
       
       def perform
-        Dir.glob(separate("#{project_directory}/src/**/[^_]*.sass")).each do |sass_file|
-          stylesheet_name = sass_file[("#{project_directory}/src/".length)..-6]
-          compile "src/#{stylesheet_name}.sass", "stylesheets/#{stylesheet_name}.css", options
+        Dir.glob(separate("#{project_src_directory}/**/[^_]*.sass")).each do |sass_file|
+          stylesheet_name = sass_file[("#{project_src_directory}/".length)..-6]
+          compile "#{project_src_subdirectory}/#{stylesheet_name}.sass", "#{project_css_subdirectory}/#{stylesheet_name}.css", options
         end
       end
 
@@ -81,9 +81,19 @@ module Compass
         @sass_load_paths ||= [project_src_directory] + Compass::Frameworks::ALL.map{|f| f.stylesheets_directory}
       end
       
+      # The subdirectory where the sass source is kept.
+      def project_src_subdirectory
+        @project_src_subdirectory ||= options[:src_dir] || "src"
+      end
+
+      # The subdirectory where the css output is kept.
+      def project_css_subdirectory
+        @project_css_subdirectory ||= options[:css_dir] || "stylesheets"
+      end
+
       # The directory where the project source files are located.
       def project_src_directory
-        @project_src_directory ||= separate("#{project_directory}/src")
+        @project_src_directory ||= separate("#{project_directory}/#{project_src_subdirectory}")
       end
 
     end
diff --git a/lib/compass/commands/watch_project.rb b/lib/compass/commands/watch_project.rb
index 4fc5ed69..bd45f990 100644
--- a/lib/compass/commands/watch_project.rb
+++ b/lib/compass/commands/watch_project.rb
@@ -28,12 +28,12 @@ module Compass
         end
       end
       def most_recent_update_time
-        Dir.glob(separate("#{project_directory}/src/**/*.sass")).map {|sass_file| File.stat(sass_file).mtime}.max
+        Dir.glob(separate("#{project_src_directory}/**/*.sass")).map {|sass_file| File.stat(sass_file).mtime}.max
       end
       def should_update?
         t = most_recent_update_time
         if t > last_update_time
-          file = Dir.glob(separate("#{project_directory}/src/**/*.sass")).detect {|sass_file| File.stat(sass_file).mtime >= t}
+          file = Dir.glob(separate("#{project_src_directory}/**/*.sass")).detect {|sass_file| File.stat(sass_file).mtime >= t}
           [file, t]
         end
       end
diff --git a/lib/compass/exec.rb b/lib/compass/exec.rb
index 62d4a4cc..da78a0af 100644
--- a/lib/compass/exec.rb
+++ b/lib/compass/exec.rb
@@ -96,6 +96,14 @@ END
           self.options[:command] = :watch_project
         end
 
+        opts.on('--source SRC_DIR', "The source directory (where you keep your sass stylesheets).") do |src_dir|
+          self.options[:src_dir] = src_dir
+        end
+
+        opts.on('--target CSS_DIR', "The target directory (where you keep your css stylesheets).") do |css_dir|
+          self.options[:css_dir] = css_dir
+        end
+
         opts.on('-f FRAMEWORK', '--framework FRAMEWORK', [:compass, :blueprint], 'Set up a new project using the selected framework. Legal values: compass (default), blueprint') do |framework|
           self.options[:framework] = framework
         end