diff --git a/packages/cli/snap-tests-global/create-from-monorepo-subdir/apps/website/package.json b/packages/cli/snap-tests-global/create-from-monorepo-subdir/apps/website/package.json
new file mode 100644
index 0000000000..042a63fe8e
--- /dev/null
+++ b/packages/cli/snap-tests-global/create-from-monorepo-subdir/apps/website/package.json
@@ -0,0 +1,4 @@
+{
+  "name": "website",
+  "version": "0.0.0"
+}
diff --git a/packages/cli/snap-tests-global/create-from-monorepo-subdir/package.json b/packages/cli/snap-tests-global/create-from-monorepo-subdir/package.json
new file mode 100644
index 0000000000..3e9925adba
--- /dev/null
+++ b/packages/cli/snap-tests-global/create-from-monorepo-subdir/package.json
@@ -0,0 +1,6 @@
+{
+  "name": "test-monorepo",
+  "version": "0.0.0",
+  "private": true,
+  "packageManager": "pnpm@10.12.1"
+}
diff --git a/packages/cli/snap-tests-global/create-from-monorepo-subdir/pnpm-workspace.yaml b/packages/cli/snap-tests-global/create-from-monorepo-subdir/pnpm-workspace.yaml
new file mode 100644
index 0000000000..7a82ab00f0
--- /dev/null
+++ b/packages/cli/snap-tests-global/create-from-monorepo-subdir/pnpm-workspace.yaml
@@ -0,0 +1,4 @@
+packages:
+  - apps/*
+  - packages/*
+  - tools/*
diff --git a/packages/cli/snap-tests-global/create-from-monorepo-subdir/scripts/helper/package.json b/packages/cli/snap-tests-global/create-from-monorepo-subdir/scripts/helper/package.json
new file mode 100644
index 0000000000..d74302b4c7
--- /dev/null
+++ b/packages/cli/snap-tests-global/create-from-monorepo-subdir/scripts/helper/package.json
@@ -0,0 +1,4 @@
+{
+  "name": "helper",
+  "version": "0.0.0"
+}
diff --git a/packages/cli/snap-tests-global/create-from-monorepo-subdir/snap.txt b/packages/cli/snap-tests-global/create-from-monorepo-subdir/snap.txt
new file mode 100644
index 0000000000..79e092d56e
--- /dev/null
+++ b/packages/cli/snap-tests-global/create-from-monorepo-subdir/snap.txt
@@ -0,0 +1,21 @@
+> cd apps/website && vp create --no-interactive vite:generator # from workspace subdir
+> test -f tools/vite-plus-generator/package.json && echo 'Created at tools/vite-plus-generator' || echo 'NOT at tools/'
+Created at tools/vite-plus-generator
+
+> test ! -f apps/website/tools/vite-plus-generator/package.json && echo 'Not in apps/website/' || echo 'BUG: in apps/website/'
+Not in apps/website/
+
+> cd apps && vp create --no-interactive vite:application # from workspace parent dir
+> test -f apps/vite-plus-application/package.json && echo 'Created at apps/vite-plus-application' || echo 'NOT at apps/'
+Created at apps/vite-plus-application
+
+> cd scripts/helper && vp create --no-interactive vite:library # from non-workspace dir
+> test -f packages/vite-plus-library/package.json && echo 'Created at packages/vite-plus-library' || echo 'NOT at packages/'
+Created at packages/vite-plus-library
+
+> test ! -f scripts/helper/packages/vite-plus-library/package.json && echo 'Not in scripts/helper/' || echo 'BUG: in scripts/helper/'
+Not in scripts/helper/
+
+> cd scripts/helper && vp create --no-interactive vite:application --directory apps/custom-app # --directory from non-workspace dir
+> test -f apps/custom-app/package.json && echo 'Created at apps/custom-app with --directory' || echo 'NOT at apps/custom-app'
+Created at apps/custom-app with --directory
diff --git a/packages/cli/snap-tests-global/create-from-monorepo-subdir/steps.json b/packages/cli/snap-tests-global/create-from-monorepo-subdir/steps.json
new file mode 100644
index 0000000000..df59c30332
--- /dev/null
+++ b/packages/cli/snap-tests-global/create-from-monorepo-subdir/steps.json
@@ -0,0 +1,29 @@
+{
+  "commands": [
+    {
+      "command": "cd apps/website && vp create --no-interactive vite:generator # from workspace subdir",
+      "ignoreOutput": true
+    },
+    "test -f tools/vite-plus-generator/package.json && echo 'Created at tools/vite-plus-generator' || echo 'NOT at tools/'",
+    "test ! -f apps/website/tools/vite-plus-generator/package.json && echo 'Not in apps/website/' || echo 'BUG: in apps/website/'",
+
+    {
+      "command": "cd apps && vp create --no-interactive vite:application # from workspace parent dir",
+      "ignoreOutput": true
+    },
+    "test -f apps/vite-plus-application/package.json && echo 'Created at apps/vite-plus-application' || echo 'NOT at apps/'",
+
+    {
+      "command": "cd scripts/helper && vp create --no-interactive vite:library # from non-workspace dir",
+      "ignoreOutput": true
+    },
+    "test -f packages/vite-plus-library/package.json && echo 'Created at packages/vite-plus-library' || echo 'NOT at packages/'",
+    "test ! -f scripts/helper/packages/vite-plus-library/package.json && echo 'Not in scripts/helper/' || echo 'BUG: in scripts/helper/'",
+
+    {
+      "command": "cd scripts/helper && vp create --no-interactive vite:application --directory apps/custom-app # --directory from non-workspace dir",
+      "ignoreOutput": true
+    },
+    "test -f apps/custom-app/package.json && echo 'Created at apps/custom-app with --directory' || echo 'NOT at apps/custom-app'"
+  ]
+}
diff --git a/packages/cli/snap-tests-global/create-from-nonworkspace-subdir/package.json b/packages/cli/snap-tests-global/create-from-nonworkspace-subdir/package.json
new file mode 100644
index 0000000000..8b8be750e5
--- /dev/null
+++ b/packages/cli/snap-tests-global/create-from-nonworkspace-subdir/package.json
@@ -0,0 +1,4 @@
+{
+  "name": "parent-project",
+  "version": "0.0.0"
+}
diff --git a/packages/cli/snap-tests-global/create-from-nonworkspace-subdir/scripts/.keep b/packages/cli/snap-tests-global/create-from-nonworkspace-subdir/scripts/.keep
new file mode 100644
index 0000000000..e69de29bb2
diff --git a/packages/cli/snap-tests-global/create-from-nonworkspace-subdir/snap.txt b/packages/cli/snap-tests-global/create-from-nonworkspace-subdir/snap.txt
new file mode 100644
index 0000000000..2a1b2ea212
--- /dev/null
+++ b/packages/cli/snap-tests-global/create-from-nonworkspace-subdir/snap.txt
@@ -0,0 +1,6 @@
+> cd scripts && vp create --no-interactive vite:application # from non-monorepo subdir
+> test -f scripts/vite-plus-application/package.json && echo 'Created at scripts/vite-plus-application' || echo 'NOT at scripts/'
+Created at scripts/vite-plus-application
+
+> test ! -f vite-plus-application/package.json && echo 'Not at parent root' || echo 'BUG: created at parent root'
+Not at parent root
diff --git a/packages/cli/snap-tests-global/create-from-nonworkspace-subdir/steps.json b/packages/cli/snap-tests-global/create-from-nonworkspace-subdir/steps.json
new file mode 100644
index 0000000000..bbbd6abbd6
--- /dev/null
+++ b/packages/cli/snap-tests-global/create-from-nonworkspace-subdir/steps.json
@@ -0,0 +1,10 @@
+{
+  "commands": [
+    {
+      "command": "cd scripts && vp create --no-interactive vite:application # from non-monorepo subdir",
+      "ignoreOutput": true
+    },
+    "test -f scripts/vite-plus-application/package.json && echo 'Created at scripts/vite-plus-application' || echo 'NOT at scripts/'",
+    "test ! -f vite-plus-application/package.json && echo 'Not at parent root' || echo 'BUG: created at parent root'"
+  ]
+}
diff --git a/packages/cli/src/create/bin.ts b/packages/cli/src/create/bin.ts
index ed7a3a6976..6a1cd8c094 100644
--- a/packages/cli/src/create/bin.ts
+++ b/packages/cli/src/create/bin.ts
@@ -15,6 +15,7 @@ import {
   selectAgentTargetPath,
   writeAgentInstructions,
 } from '../utils/agent.js';
+import { displayRelative } from '../utils/path.js';
 import {
   defaultInteractive,
   downloadPackageManager,
@@ -184,9 +185,28 @@ Use \`vp create --list\` to list all available templates, or run \`vp create --h
     packageName = formatted.packageName;
   }
 
-  const workspaceInfoOptional = await detectWorkspace(process.cwd());
+  const cwd = process.cwd();
+  const workspaceInfoOptional = await detectWorkspace(cwd);
   const isMonorepo = workspaceInfoOptional.isMonorepo;
 
+  // For non-monorepo, always use cwd as rootDir.
+  // detectWorkspace walks up to find the nearest package.json, but for `vp create`
+  // in standalone mode, the project should be created relative to where the user is.
+  if (!isMonorepo) {
+    workspaceInfoOptional.rootDir = cwd;
+  }
+  const cwdRelativeToRoot =
+    isMonorepo && workspaceInfoOptional.rootDir !== cwd
+      ? displayRelative(cwd, workspaceInfoOptional.rootDir)
+      : '';
+  const isInSubdirectory = cwdRelativeToRoot !== '';
+  const cwdUnderParentDir = isInSubdirectory
+    ? workspaceInfoOptional.parentDirs.some(
+        (dir) => cwdRelativeToRoot === dir || cwdRelativeToRoot.startsWith(`${dir}/`),
+      )
+    : true;
+  const shouldOfferCwdOption = isInSubdirectory && !cwdUnderParentDir;
+
   // Interactive mode: prompt for template if not provided
   let selectedTemplateName = templateName as string;
   let selectedTemplateArgs = [...templateArgs];
@@ -287,27 +307,44 @@ Use \`vp create --list\` to list all available templates, or run \`vp create --h
     cancelAndExit('Cannot create a monorepo inside an existing monorepo', 1);
   }
 
+  if (isInSubdirectory) {
+    prompts.log.info(`Detected monorepo root at ${accent(workspaceInfoOptional.rootDir)}`);
+  }
+
   if (isMonorepo && options.interactive && !targetDir) {
     let parentDir: string | undefined;
-    if (workspaceInfoOptional.parentDirs.length > 0) {
-      const defaultParentDir =
-        inferParentDir(selectedTemplateName, workspaceInfoOptional) ??
-        workspaceInfoOptional.parentDirs[0];
+    const hasParentDirs = workspaceInfoOptional.parentDirs.length > 0;
+
+    if (hasParentDirs || isInSubdirectory) {
+      const dirOptions: { label: string; value: string; hint: string }[] =
+        workspaceInfoOptional.parentDirs.map((dir) => ({
+          label: `${dir}/`,
+          value: dir,
+          hint: '',
+        }));
+
+      if (shouldOfferCwdOption) {
+        dirOptions.push({
+          label: `${cwdRelativeToRoot}/ (current directory)`,
+          value: cwdRelativeToRoot,
+          hint: '',
+        });
+      }
+
+      dirOptions.push({
+        label: 'other directory',
+        value: 'other',
+        hint: 'Enter a custom target directory',
+      });
+
+      const defaultParentDir = shouldOfferCwdOption
+        ? cwdRelativeToRoot
+        : (inferParentDir(selectedTemplateName, workspaceInfoOptional) ??
+          workspaceInfoOptional.parentDirs[0]);
+
       const selected = await prompts.select({
         message: 'Where should the new package be added to the monorepo:',
-        options: workspaceInfoOptional.parentDirs
-          .map((dir) => ({
-            label: `${dir}/`,
-            value: dir,
-            hint: ``,
-          }))
-          .concat([
-            {
-              label: 'other',
-              value: 'other',
-              hint: 'Enter a custom target directory',
-            },
-          ]),
+        options: dirOptions,
         initialValue: defaultParentDir,
       });
 
@@ -339,6 +376,9 @@ Use \`vp create --list\` to list all available templates, or run \`vp create --h
     selectedParentDir = parentDir;
   }
   if (isMonorepo && !options.interactive && !targetDir) {
+    if (isInSubdirectory) {
+      prompts.log.info(`Use ${accent('--directory')} to specify a different target location.`);
+    }
     const inferredParentDir =
       inferParentDir(selectedTemplateName, workspaceInfoOptional) ??
       workspaceInfoOptional.parentDirs[0];
diff --git a/packages/cli/src/create/prompts.ts b/packages/cli/src/create/prompts.ts
index 6d170c9c6c..f270a7fded 100644
--- a/packages/cli/src/create/prompts.ts
+++ b/packages/cli/src/create/prompts.ts
@@ -20,7 +20,7 @@ export async function promptPackageNameAndTargetDir(
       placeholder: defaultPackageName,
       defaultValue: defaultPackageName,
       validate: (value) => {
-        if (value != null && value.length === 0) {
+        if (value == null || value.length === 0) {
           return;
         }