diff --git a/packages/playwright-core/src/tools/backend/context.ts b/packages/playwright-core/src/tools/backend/context.ts
index 91eee5813f0d6..39f6456739657 100644
--- a/packages/playwright-core/src/tools/backend/context.ts
+++ b/packages/playwright-core/src/tools/backend/context.ts
@@ -15,6 +15,7 @@
  */
 
 import fs from 'fs';
+import os from 'os';
 import path from 'path';
 
 import { debug } from '../../utilsBundle';
@@ -366,7 +367,11 @@ export async function workspaceFile(options: ContextOptions, fileName: string, p
 export function outputDir(options: ContextOptions): string {
   if (options.config.outputDir)
     return path.resolve(options.config.outputDir);
-  return path.resolve(options.cwd, options.config.skillMode ? '.playwright-cli' : '.playwright-mcp');
+  const subdir = options.config.skillMode ? '.playwright-cli' : '.playwright-mcp';
+  const cwd = path.resolve(options.cwd);
+  if (cwd === path.parse(cwd).root)
+    return path.join(os.tmpdir(), subdir);
+  return path.resolve(cwd, subdir);
 }
 
 export async function outputFile(options: ContextOptions, fileName: string, flags: { origin: 'code' | 'llm' }): Promise<string> {
diff --git a/tests/mcp/config-resolve.spec.ts b/tests/mcp/config-resolve.spec.ts
index f30681c6dc04c..1a0bf6a6deee8 100644
--- a/tests/mcp/config-resolve.spec.ts
+++ b/tests/mcp/config-resolve.spec.ts
@@ -15,11 +15,13 @@
  */
 
 import fs from 'fs';
+import os from 'os';
 import path from 'path';
 
 import { test, expect } from '@playwright/test';
 
 import { resolveCLIConfigForCLI, resolveCLIConfigForMCP } from '../../packages/playwright-core/lib/tools/mcp/config';
+import { outputDir } from '../../packages/playwright-core/lib/tools/backend/context';
 
 import type { Config } from '../../packages/playwright-core/src/tools/mcp/config.d';
 
@@ -464,3 +466,25 @@ test.describe('resolveCLIConfigForCLI - extension', () => {
     expect(config.browser.isolated).toBe(false);
   });
 });
+
+test.describe('outputDir', () => {
+  test('uses config.outputDir when set', () => {
+    const dir = outputDir({ config: { outputDir: '/tmp/custom' }, cwd: '/some/project' } as any);
+    expect(dir).toBe(path.resolve('/tmp/custom'));
+  });
+
+  test('uses cwd-relative .playwright-mcp by default', () => {
+    const dir = outputDir({ config: {}, cwd: '/some/project' } as any);
+    expect(dir).toBe(path.resolve('/some/project', '.playwright-mcp'));
+  });
+
+  test('falls back to tmpdir when cwd is filesystem root', () => {
+    const dir = outputDir({ config: {}, cwd: '/' } as any);
+    expect(dir).toBe(path.join(os.tmpdir(), '.playwright-mcp'));
+  });
+
+  test('uses .playwright-cli subdir in skillMode', () => {
+    const dir = outputDir({ config: { skillMode: true }, cwd: '/' } as any);
+    expect(dir).toBe(path.join(os.tmpdir(), '.playwright-cli'));
+  });
+});