diff --git a/features/pagination.feature b/features/pagination.feature
index cc3cf4d6..9482f18f 100644
--- a/features/pagination.feature
+++ b/features/pagination.feature
@@ -2,13 +2,13 @@ Feature: Site pagination
   In order to paginate my blog
   As a blog's user
   I want divide the posts in several pages
-  
+
   Scenario Outline: Paginate with N posts per page
     Given I have a configuration file with "paginate" set to "<num>"
     And I have a _layouts directory
     And I have an "index.html" page that contains "{{ paginator.posts.size }}"
     And I have a _posts directory
-    And I have the following post:
+    And I have the following posts:
       | title     | date      | layout  | content                                |
       | Wargames  | 3/27/2009 | default | The only winning move is not to play.  |
       | Wargames2 | 4/27/2009 | default | The only winning move is not to play2. |
@@ -32,10 +32,10 @@ Feature: Site pagination
       | paginate      | 1                              |
       | paginate_path | /blog/page-:num                |
       | permalink     | /blog/:year/:month/:day/:title |
-      And I have a _layouts directory
-      And I have an "index.html" page that contains "{{ paginator.posts.size }}"
+    And I have a blog directory
+    And I have an "blog/index.html" page that contains "{{ paginator.posts.size }}"
     And I have a _posts directory
-    And I have the following post:
+    And I have the following posts:
       | title     | date      | layout  | content                                |
       | Wargames  | 3/27/2009 | default | The only winning move is not to play.  |
       | Wargames2 | 4/27/2009 | default | The only winning move is not to play2. |
diff --git a/features/step_definitions/jekyll_steps.rb b/features/step_definitions/jekyll_steps.rb
index c30b9034..75330738 100644
--- a/features/step_definitions/jekyll_steps.rb
+++ b/features/step_definitions/jekyll_steps.rb
@@ -5,7 +5,7 @@ Before do
 end
 
 After do
-  Dir.chdir(TEST_DIR)
+  Dir.chdir(File.expand_path("..", TEST_DIR))
   FileUtils.rm_rf(TEST_DIR)
 end
 
diff --git a/lib/jekyll/generators/pagination.rb b/lib/jekyll/generators/pagination.rb
index 71e27fba..0cd934c5 100644
--- a/lib/jekyll/generators/pagination.rb
+++ b/lib/jekyll/generators/pagination.rb
@@ -11,7 +11,7 @@ module Jekyll
       # Returns nothing.
       def generate(site)
         site.pages.dup.each do |page|
-          paginate(site, page) if Pager.pagination_enabled?(site.config, page.name)
+          paginate(site, page) if Pager.pagination_enabled?(site.config, page)
         end
       end
 
@@ -65,11 +65,23 @@ module Jekyll
     # Determine if pagination is enabled for a given file.
     #
     # config - The configuration Hash.
-    # file   - The String filename of the file.
+    # page   - The Jekyll::Page with which to paginate
     #
     # Returns true if pagination is enabled, false otherwise.
-    def self.pagination_enabled?(config, file)
-      file == 'index.html' && !config['paginate'].nil?
+    def self.pagination_enabled?(config, page)
+     !config['paginate'].nil? &&
+        page.name == 'index.html' &&
+        subdirectories_identical(config['paginate_path'], page.dir)
+    end
+
+    # Determine if the subdirectories of the two paths are the same relative to source
+    #
+    # paginate_path - the paginate_path configuration setting
+    # page_dir      - the directory of the Jekyll::Page
+    #
+    # Returns whether the subdirectories are the same relative to source
+    def self.subdirectories_identical(paginate_path, page_dir)
+      File.dirname(paginate_path).gsub(/\A\./, '') == page_dir.gsub(/\/\z/, '')
     end
 
     # Static: Return the pagination path of the page
@@ -80,7 +92,7 @@ module Jekyll
     # Returns the pagination path as a string
     def self.paginate_path(site_config, num_page)
       return nil if num_page.nil? || num_page <= 1
-      format = site_config['paginate_path']
+      format = File.basename(site_config['paginate_path'])
       format.sub(':num', num_page.to_s)
     end
 
diff --git a/test/helper.rb b/test/helper.rb
index a20d236f..3ee3f2b6 100644
--- a/test/helper.rb
+++ b/test/helper.rb
@@ -6,6 +6,7 @@ end
 
 require 'rubygems'
 require 'test/unit'
+require 'ostruct'
 gem 'RedCloth', '>= 4.2.1'
 
 require 'jekyll'
diff --git a/test/test_pager.rb b/test/test_pager.rb
index fe1156ca..7e153ea4 100644
--- a/test/test_pager.rb
+++ b/test/test_pager.rb
@@ -23,7 +23,8 @@ class TestPager < Test::Unit::TestCase
     end
 
     should "report that pagination is disabled" do
-      assert !Pager.pagination_enabled?(@config, 'index.html')
+      page = OpenStruct.new({ :name => 'index.html', :dir => '/' })
+      assert !Pager.pagination_enabled?(@config, page)
     end
 
   end
@@ -45,7 +46,8 @@ class TestPager < Test::Unit::TestCase
     end
 
     should "report that pagination is enabled" do
-      assert Pager.pagination_enabled?(@config, 'index.html')
+      page = OpenStruct.new({ :name => 'index.html', :dir => '/' })
+      assert Pager.pagination_enabled?(@config, page)
     end
 
     context "with 4 posts" do