diff --git a/Package.swift b/Package.swift
index 89d3924..0500bc9 100644
--- a/Package.swift
+++ b/Package.swift
@@ -18,6 +18,10 @@ let package = Package(
         .product(name: "ArgumentParser", package: "swift-argument-parser"),
         .product(name: "ZIPFoundation", package: "ZIPFoundation")
       ]
+    ),
+    .testTarget(
+      name: "pfwTests",
+      dependencies: ["pfw"]
     )
   ],
   swiftLanguageModes: [.v6]
diff --git a/Sources/pfw/Install.swift b/Sources/pfw/Install.swift
index 84026ab..d474904 100644
--- a/Sources/pfw/Install.swift
+++ b/Sources/pfw/Install.swift
@@ -27,13 +27,37 @@ struct Install: AsyncParsableCommand {
   )
   var tool: Tool = .codex
 
-  @Option(help: "Directory to install skills into.")
+  @Option(help: "Directory to install skills into. Use '.' for current directory.")
   var path: String?
 
   func run() async throws {
     try await install(shouldRetryAfterLogin: true)
   }
 
+  // MARK: - Testable Helper Functions
+
+  static func isCurrentDirectoryPath(_ path: String?) -> Bool {
+    path == "."
+  }
+
+  static func validateInstallPath(_ installPath: String, tool: Tool) -> Bool {
+    // Allow any path that contains /skills to support different directory naming conventions
+    // (e.g., .codex/skills, .claude/skills, .github/skills, .copilot/skills)
+    return installPath.contains("/skills")
+  }
+
+  static func resolveInstallURL(
+    path: String?,
+    tool: Tool,
+    currentDirectory: String = FileManager.default.currentDirectoryPath
+  ) -> URL {
+    if isCurrentDirectoryPath(path) {
+      return URL(fileURLWithPath: currentDirectory)
+    } else {
+      return URL(fileURLWithPath: path ?? tool.defaultInstallPath.path)
+    }
+  }
+
   private func install(shouldRetryAfterLogin: Bool) async throws {
     let token = try loadToken()
     let machine = try machine()
@@ -68,9 +92,82 @@ struct Install: AsyncParsableCommand {
     let zipURL = URL.temporaryDirectory.appending(path: UUID().uuidString)
     try data.write(to: zipURL)
 
-    let installURL = URL(fileURLWithPath: path ?? tool.defaultInstallPath.path)
-    try? FileManager.default.removeItem(at: installURL)
-    try FileManager.default.unzipItem(at: zipURL, to: installURL)
-    print("Installed skills for \(tool.rawValue) into \(installURL.path)")
+    // Determine if installing to current directory
+    let isCurrentDirectory = Self.isCurrentDirectoryPath(path)
+    let installURL = Self.resolveInstallURL(path: path, tool: tool)
+
+    // Verify the install path is in the expected location (only if custom path provided)
+    if path != nil {
+      let installPath = installURL.path
+
+      guard Self.validateInstallPath(installPath, tool: tool) else {
+        print("Error: Install path is not in the expected location.")
+        print("")
+        print("The install path must contain '/skills' in it.")
+        print("")
+        print("Valid options:")
+        print("  1. Use default path: pfw install --tool \(tool.rawValue)")
+        print("     Installs to: ~/.\(tool.rawValue)/skills/the-point-free-way")
+        print("")
+        print("  2. Use custom path containing '/skills':")
+        print("     pfw install --tool \(tool.rawValue) --path /your/project/.config/skills")
+        print("")
+        print("Current install path: \(installPath)")
+        throw ExitCode.failure
+      }
+
+      // Ask for confirmation when using custom path
+      print("You are about to install into:")
+      print("  \(installPath)")
+      print("\nThis will merge new skills with existing ones without removing current files.")
+      print("Continue? (yes/no): ", terminator: "")
+
+      guard let response = readLine()?.lowercased(),
+            response == "yes" || response == "y" else {
+        print("Installation cancelled.")
+        throw ExitCode.success
+      }
+    }
+
+    // Always merge - never remove existing files
+    // The zip contains a top-level "skills" folder, so we extract to a temp location
+    // and then move the contents of the skills folder to the target location
+    let tempExtractURL = URL.temporaryDirectory.appending(path: UUID().uuidString)
+    try FileManager.default.createDirectory(at: tempExtractURL, withIntermediateDirectories: true)
+
+    try FileManager.default.unzipItem(at: zipURL, to: tempExtractURL)
+
+    // The zip extracts to tempExtractURL/skills/, we want to move its contents to installURL
+    let extractedSkillsURL = tempExtractURL.appending(path: "skills")
+
+    // Ensure target directory exists
+    try FileManager.default.createDirectory(at: installURL, withIntermediateDirectories: true)
+
+    // Move each skill from the extracted location to the target
+    let skillDirs = try FileManager.default.contentsOfDirectory(
+      at: extractedSkillsURL,
+      includingPropertiesForKeys: nil
+    )
+
+    for skillURL in skillDirs {
+      let targetURL = installURL.appending(path: skillURL.lastPathComponent)
+
+      // If the skill already exists, remove it first (we're replacing individual skills, not the whole directory)
+      if FileManager.default.fileExists(atPath: targetURL.path) {
+        try FileManager.default.removeItem(at: targetURL)
+      }
+
+      try FileManager.default.moveItem(at: skillURL, to: targetURL)
+    }
+
+    // Clean up temp directory
+    try? FileManager.default.removeItem(at: tempExtractURL)
+    try? FileManager.default.removeItem(at: zipURL)
+
+    if isCurrentDirectory {
+      print("Successfully merged skills into \(installURL.path)")
+    } else {
+      print("Installed and merged skills for \(tool.rawValue) into \(installURL.path)")
+    }
   }
 }
diff --git a/Tests/pfwTests/InstallTests.swift b/Tests/pfwTests/InstallTests.swift
new file mode 100644
index 0000000..d335a60
--- /dev/null
+++ b/Tests/pfwTests/InstallTests.swift
@@ -0,0 +1,155 @@
+import Testing
+import Foundation
+@testable import pfw
+
+@Suite("Install Path Validation Tests")
+struct InstallPathValidationTests {
+
+  @Test("Valid Claude skills path is accepted")
+  func validClaudeSkillsPath() {
+    #expect(Install.validateInstallPath("/Users/test/.claude/skills", tool: .claude))
+    #expect(Install.validateInstallPath("/project/.claude/skills/my-skills", tool: .claude))
+    #expect(Install.validateInstallPath("/home/user/.claude/skills", tool: .claude))
+  }
+
+  @Test("Valid Codex skills path is accepted")
+  func validCodexSkillsPath() {
+    #expect(Install.validateInstallPath("/Users/test/.codex/skills", tool: .codex))
+    #expect(Install.validateInstallPath("/project/.codex/skills/custom", tool: .codex))
+    #expect(Install.validateInstallPath("/home/user/.codex/skills", tool: .codex))
+  }
+
+  @Test("Flexible directory naming is supported")
+  func flexibleDirectoryNaming() {
+    // Support different directory naming conventions (e.g., .github for copilot)
+    #expect(Install.validateInstallPath("/Users/test/.github/skills", tool: .claude))
+    #expect(Install.validateInstallPath("/project/.config/skills", tool: .codex))
+    #expect(Install.validateInstallPath("/home/user/my-project/skills", tool: .claude))
+  }
+
+  @Test("Invalid paths are rejected")
+  func invalidPathsRejected() {
+    // Paths without /skills
+    #expect(!Install.validateInstallPath("/tmp", tool: .claude))
+    #expect(!Install.validateInstallPath("/Users/test/Downloads", tool: .claude))
+    #expect(!Install.validateInstallPath("/project", tool: .codex))
+    #expect(!Install.validateInstallPath("/home/user/.claude", tool: .claude))
+  }
+
+  @Test("Paths containing skills keyword are accepted")
+  func pathsContainingSkillsAccepted() {
+    // Any path with /skills is valid regardless of tool
+    #expect(Install.validateInstallPath("/Users/test/.claude/skills", tool: .codex))
+    #expect(Install.validateInstallPath("/Users/test/.codex/skills", tool: .claude))
+    #expect(Install.validateInstallPath("/home/user/skills", tool: .claude))
+  }
+}
+
+@Suite("Current Directory Detection Tests")
+struct CurrentDirectoryDetectionTests {
+
+  @Test("Dot is recognized as current directory")
+  func dotIsCurrentDirectory() {
+    #expect(Install.isCurrentDirectoryPath("."))
+  }
+
+  @Test("nil is not current directory")
+  func nilIsNotCurrentDirectory() {
+    #expect(!Install.isCurrentDirectoryPath(nil))
+  }
+
+  @Test("Absolute paths are not current directory")
+  func absolutePathsNotCurrentDirectory() {
+    #expect(!Install.isCurrentDirectoryPath("/tmp"))
+    #expect(!Install.isCurrentDirectoryPath("/Users/test/.claude/skills"))
+    #expect(!Install.isCurrentDirectoryPath("~/project"))
+  }
+
+  @Test("Relative paths are not current directory")
+  func relativePathsNotCurrentDirectory() {
+    #expect(!Install.isCurrentDirectoryPath("./subdir"))
+    #expect(!Install.isCurrentDirectoryPath("../parent"))
+  }
+}
+
+@Suite("Install URL Resolution Tests")
+struct InstallURLResolutionTests {
+
+  @Test("Resolves to current directory when path is dot")
+  func resolvesToCurrentDirectoryForDot() {
+    let currentDir = "/Users/test/.claude/skills"
+    let url = Install.resolveInstallURL(path: ".", tool: .claude, currentDirectory: currentDir)
+    #expect(url.path == currentDir)
+  }
+
+  @Test("Resolves to custom path when provided")
+  func resolvesToCustomPath() {
+    let customPath = "/project/.claude/skills"
+    let url = Install.resolveInstallURL(path: customPath, tool: .claude)
+    #expect(url.path == customPath)
+  }
+
+  @Test("Resolves to default path when path is nil for Claude")
+  func resolvesToDefaultPathForClaude() {
+    let url = Install.resolveInstallURL(path: nil, tool: .claude)
+    #expect(url.path.contains(".claude/skills/the-point-free-way"))
+  }
+
+  @Test("Resolves to default path when path is nil for Codex")
+  func resolvesToDefaultPathForCodex() {
+    let url = Install.resolveInstallURL(path: nil, tool: .codex)
+    #expect(url.path.contains(".codex/skills/the-point-free-way"))
+  }
+}
+
+@Suite("Tool Default Paths Tests")
+struct ToolDefaultPathsTests {
+
+  @Test("Claude default path contains correct pattern")
+  func claudeDefaultPath() {
+    let path = Install.Tool.claude.defaultInstallPath
+    #expect(path.path.contains(".claude/skills/the-point-free-way"))
+  }
+
+  @Test("Codex default path contains correct pattern")
+  func codexDefaultPath() {
+    let path = Install.Tool.codex.defaultInstallPath
+    #expect(path.path.contains(".codex/skills/the-point-free-way"))
+  }
+}
+
+@Suite("Edge Cases Tests")
+struct EdgeCasesTests {
+
+  @Test("Empty string path is not current directory")
+  func emptyStringNotCurrentDirectory() {
+    #expect(!Install.isCurrentDirectoryPath(""))
+  }
+
+  @Test("Whitespace path is not current directory")
+  func whitespaceNotCurrentDirectory() {
+    #expect(!Install.isCurrentDirectoryPath(" "))
+    #expect(!Install.isCurrentDirectoryPath("  "))
+  }
+
+  @Test("Skills keyword validation is case sensitive")
+  func skillsKeywordCaseSensitive() {
+    // Lowercase /skills should match
+    #expect(Install.validateInstallPath("/Users/test/.claude/skills", tool: .claude))
+    // Capitalized /Skills or /SKILLS should not match (path is case-sensitive)
+    #expect(!Install.validateInstallPath("/Users/test/.claude/Skills", tool: .claude))
+    #expect(!Install.validateInstallPath("/Users/test/.claude/SKILLS", tool: .claude))
+  }
+
+  @Test("Path with multiple dots")
+  func pathWithMultipleDots() {
+    #expect(Install.validateInstallPath("/Users/test.user/.claude/skills", tool: .claude))
+    #expect(Install.validateInstallPath("/Users/test/.config/.claude/skills", tool: .claude))
+  }
+
+  @Test("Path with trailing slashes")
+  func pathWithTrailingSlashes() {
+    #expect(Install.validateInstallPath("/Users/test/.claude/skills/", tool: .claude))
+    #expect(Install.validateInstallPath("/Users/test/.claude/skills//", tool: .claude))
+  }
+}