diff --git a/studio/backend/utils/paths/path_utils.py b/studio/backend/utils/paths/path_utils.py
index 7743952b6b..856e478bc2 100644
--- a/studio/backend/utils/paths/path_utils.py
+++ b/studio/backend/utils/paths/path_utils.py
@@ -41,6 +41,13 @@ def is_local_path(path: str) -> bool:
     if not path:
         return False
 
+    # If it exists on disk, treat as local (covers relative paths like "outputs/foo").
+    try:
+        if Path(normalize_path(path)).expanduser().exists():
+            return True
+    except Exception:
+        pass
+
     # Obvious HF patterns
     if path.count('/') == 1 and not path.startswith(('/', '.', '~')):
         return False  # Looks like org/model format