diff --git a/studio/backend/core/training/worker.py b/studio/backend/core/training/worker.py
index 1120744a2d..4a6d182da8 100644
--- a/studio/backend/core/training/worker.py
+++ b/studio/backend/core/training/worker.py
@@ -1687,12 +1687,12 @@ def _run_mlx_training(event_queue, stop_queue, config):
         warmup_steps = 5
 
     # ── 5. Build output dir ──
+    # Resolve to ~/.unsloth/studio/outputs/ so the export page finds it
+    from utils.paths import resolve_output_dir, ensure_dir, default_run_dir_name
+
     output_dir = config.get("output_dir", "")
     if not output_dir:
-        output_dir = f"{model_name.replace('/', '_')}_{int(time.time())}"
-    # Resolve to ~/.unsloth/studio/outputs/ so the export page finds it
-    from utils.paths import resolve_output_dir, ensure_dir
-
+        output_dir = f"{default_run_dir_name(model_name)}_{int(time.time())}"
     output_dir = str(resolve_output_dir(output_dir))
     ensure_dir(Path(output_dir))
 
@@ -2450,6 +2450,7 @@ def run_training_process(*, event_queue: Any, stop_queue: Any, config: dict) ->
             resolve_output_dir,
             resolve_tensorboard_dir,
             datasets_root,
+            default_run_dir_name,
         )
 
         import transformers
@@ -2773,7 +2774,7 @@ def run_training_process(*, event_queue: Any, stop_queue: Any, config: dict) ->
             resume_from_checkpoint
         )
         if not output_dir:
-            output_dir = f"{model_name.replace('/', '_')}_{int(time.time())}"
+            output_dir = f"{default_run_dir_name(model_name)}_{int(time.time())}"
         output_dir = str(resolve_output_dir(output_dir))
         ensure_dir(Path(output_dir))
 
@@ -2924,7 +2925,7 @@ def _run_embedding_training(event_queue: Any, stop_queue: Any, config: dict) ->
         from datasets import Dataset
         from utils.datasets.cache_safe import load_dataset_cache_safe as load_dataset
         from transformers import TrainerCallback
-        from utils.paths import datasets_root, resolve_output_dir
+        from utils.paths import datasets_root, resolve_output_dir, default_run_dir_name
     except ImportError as e:
         event_queue.put(
             {
@@ -3182,7 +3183,7 @@ def _run_embedding_training(event_queue: Any, stop_queue: Any, config: dict) ->
         resume_from_checkpoint
     )
     if not output_dir:
-        output_dir = str(resolve_output_dir(f"{model_name.replace('/', '_')}_{int(time.time())}"))
+        output_dir = f"{default_run_dir_name(model_name)}_{int(time.time())}"
     output_dir = str(resolve_output_dir(output_dir))
 
     num_epochs = config.get("num_epochs", 2)
diff --git a/studio/backend/tests/test_default_output_dir_name.py b/studio/backend/tests/test_default_output_dir_name.py
new file mode 100644
index 0000000000..d8a7f5ae21
--- /dev/null
+++ b/studio/backend/tests/test_default_output_dir_name.py
@@ -0,0 +1,65 @@
+# SPDX-License-Identifier: AGPL-3.0-only
+# Copyright 2026-present the Unsloth AI Inc. team. All rights reserved. See /studio/LICENSE.AGPL-3.0
+
+"""Auto-generated training output dir names stay inside outputs_root.
+
+Regression for local-model training: a model loaded by absolute path (e.g.
+``G:\\modelsAI\\...\\gemma-4-12B-it`` on a non-system drive) used to seed the
+default run dir with that full path, so ``resolve_output_dir`` raised
+``path escapes root`` because the result was not under ``<studio>/outputs``.
+"""
+
+import importlib.util
+from pathlib import Path
+
+import pytest
+
+
+_BACKEND_DIR = Path(__file__).resolve().parent.parent
+
+
+def _load_storage_roots():
+    path = _BACKEND_DIR / "utils/paths/storage_roots.py"
+    spec = importlib.util.spec_from_file_location("storage_roots_under_test", path)
+    module = importlib.util.module_from_spec(spec)
+    spec.loader.exec_module(module)
+    return module
+
+
+def test_repo_id_keeps_namespace():
+    sr = _load_storage_roots()
+    assert sr.default_run_dir_name("unsloth/gemma-3-4b") == "unsloth_gemma-3-4b"
+    assert sr.default_run_dir_name("gemma-3-4b") == "gemma-3-4b"
+
+
+def test_local_paths_collapse_to_basename():
+    sr = _load_storage_roots()
+    assert sr.default_run_dir_name(r"G:\modelsAI\gguf\test\gemma-4-12B-it") == "gemma-4-12B-it"
+    assert sr.default_run_dir_name("/data/models/gemma-3-4b") == "gemma-3-4b"
+    assert sr.default_run_dir_name("~/models/gemma-3-4b") == "gemma-3-4b"
+    assert sr.default_run_dir_name("C:/Users/me/models/gemma-3-4b") == "gemma-3-4b"
+
+
+def test_empty_falls_back_to_model():
+    sr = _load_storage_roots()
+    assert sr.default_run_dir_name("") == "model"
+    assert sr.default_run_dir_name("   ") == "model"
+
+
+def test_very_long_name_is_capped():
+    sr = _load_storage_roots()
+    name = sr.default_run_dir_name("a" * 500)
+    assert 0 < len(name) <= 200
+
+
+def test_derived_name_resolves_under_outputs_root(tmp_path, monkeypatch):
+    sr = _load_storage_roots()
+    outputs = tmp_path / "outputs"
+    outputs.mkdir()
+    monkeypatch.setattr(sr, "outputs_root", lambda: outputs)
+
+    name = sr.default_run_dir_name(r"G:\modelsAI\gguf\test\gemma-4-12B-it")
+    resolved = sr.resolve_output_dir(f"{name}_1781327234")
+    assert resolved == outputs / "gemma-4-12B-it_1781327234"
+    # No escape: the absolute G: source no longer leaks into the output path.
+    assert "modelsAI" not in str(resolved)
diff --git a/studio/backend/utils/paths/__init__.py b/studio/backend/utils/paths/__init__.py
index eff9b64678..e812fa9e61 100644
--- a/studio/backend/utils/paths/__init__.py
+++ b/studio/backend/utils/paths/__init__.py
@@ -41,6 +41,7 @@ from .storage_roots import (
     ensure_dir,
     ensure_studio_directories,
     resolve_under_root,
+    default_run_dir_name,
     resolve_output_dir,
     resolve_export_dir,
     resolve_export_write_dir,
@@ -88,6 +89,7 @@ __all__ = [
     "ensure_dir",
     "ensure_studio_directories",
     "resolve_under_root",
+    "default_run_dir_name",
     "resolve_output_dir",
     "resolve_export_dir",
     "resolve_export_write_dir",
diff --git a/studio/backend/utils/paths/storage_roots.py b/studio/backend/utils/paths/storage_roots.py
index d336bc2e71..c718f38ffb 100644
--- a/studio/backend/utils/paths/storage_roots.py
+++ b/studio/backend/utils/paths/storage_roots.py
@@ -5,6 +5,7 @@ from __future__ import annotations
 
 import json
 import os
+import re
 import sys
 from pathlib import Path, PurePosixPath, PureWindowsPath
 import tempfile
@@ -384,6 +385,23 @@ def resolve_under_root(
     return candidate
 
 
+def default_run_dir_name(model_name: str) -> str:
+    # Folder-safe run name for an auto-created output dir. Repo ids keep their
+    # namespace (org/model -> org_model); local paths (incl. G:\dir\model)
+    # collapse to their final component so an absolute source can't escape
+    # outputs_root. Length-capped to stay under the filesystem name limit.
+    raw = str(model_name or "").strip()
+    is_path = (
+        "\\" in raw
+        or raw.startswith(("/", "~", "."))
+        or os.path.isabs(raw)
+        or (len(raw) >= 2 and raw[1] == ":")
+    )
+    base = PureWindowsPath(raw).name if is_path else raw.replace("/", "_")
+    base = re.sub(r"[^A-Za-z0-9._-]+", "_", base)[:200].strip("._-")
+    return base or "model"
+
+
 def resolve_output_dir(path_value: str | None = None) -> Path:
     return resolve_under_root(
         path_value,