diff --git a/lib/runner/tsconfigPaths.ts b/lib/runner/tsconfigPaths.ts
index 80c9d88e..92e48999 100644
--- a/lib/runner/tsconfigPaths.ts
+++ b/lib/runner/tsconfigPaths.ts
@@ -1,4 +1,5 @@
 import { normalizeFilePath } from "./normalizeFsMap"
+import { joinPath } from "../utils/pathJoin"
 
 type RawTsConfig = {
   compilerOptions?: {
@@ -40,6 +41,13 @@ export function resolveWithTsconfigPaths(opts: {
   const { importPath, normalizedFilePathMap, extensions, tsConfig } = opts
   if (!tsConfig) return null
   const { baseUrl, paths } = tsConfig
+  const normalizedBaseUrl = baseUrl ? normalizeFilePath(baseUrl) : ""
+  const effectiveBaseUrl = normalizedBaseUrl === "." ? "" : normalizedBaseUrl
+
+  const resolveTargetWithBaseUrl = (target: string) => {
+    if (!baseUrl || target.startsWith("/")) return target
+    return joinPath(effectiveBaseUrl, target)
+  }
 
   const tryResolveCandidate = (candidate: string) => {
     const normalizedCandidate = normalizeFilePath(candidate)
@@ -72,20 +80,14 @@ export function resolveWithTsconfigPaths(opts: {
       )
       for (const target of targets) {
         const replaced = target.replace("*", starMatch)
-        const candidate =
-          baseUrl && !replaced.startsWith("./") && !replaced.startsWith("/")
-            ? `${baseUrl}/${replaced}`
-            : replaced
+        const candidate = resolveTargetWithBaseUrl(replaced)
         const resolved = tryResolveCandidate(candidate)
         if (resolved) return resolved
       }
     } else {
       if (importPath !== alias) continue
       for (const target of targets) {
-        const candidate =
-          baseUrl && !target.startsWith("./") && !target.startsWith("/")
-            ? `${baseUrl}/${target}`
-            : target
+        const candidate = resolveTargetWithBaseUrl(target)
         const resolved = tryResolveCandidate(candidate)
         if (resolved) return resolved
       }
diff --git a/lib/utils/pathJoin.ts b/lib/utils/pathJoin.ts
new file mode 100644
index 00000000..6316bc30
--- /dev/null
+++ b/lib/utils/pathJoin.ts
@@ -0,0 +1,38 @@
+export function joinPath(...parts: string[]): string {
+  const segments: string[] = []
+  let isAbsolute = false
+
+  for (const part of parts) {
+    if (!part) continue
+    const normalized = part.replace(/\\/g, "/")
+    if (!normalized) continue
+
+    if (normalized.startsWith("/")) {
+      segments.length = 0
+      isAbsolute = true
+    }
+
+    for (const segment of normalized.split("/")) {
+      if (!segment || segment === ".") {
+        continue
+      }
+      if (segment === "..") {
+        if (segments.length && segments[segments.length - 1] !== "..") {
+          segments.pop()
+          continue
+        }
+        if (!isAbsolute) {
+          segments.push("..")
+        }
+        continue
+      }
+      segments.push(segment)
+    }
+  }
+
+  const joined = segments.join("/")
+  if (isAbsolute) {
+    return joined ? `/${joined}` : "/"
+  }
+  return joined
+}
diff --git a/tests/features/tsconfig-paths-resolution.test.tsx b/tests/features/tsconfig-paths-resolution.test.tsx
index 725dc89b..89e7ba18 100644
--- a/tests/features/tsconfig-paths-resolution.test.tsx
+++ b/tests/features/tsconfig-paths-resolution.test.tsx
@@ -63,3 +63,34 @@ test("throws error when tsconfig path alias cannot be resolved (instead of tryin
     'Import "@utils/missing" matches a tsconfig path alias but could not be resolved to an existing file',
   )
 })
+
+test("tsconfig paths honor baseUrl when targets use relative prefixes", async () => {
+  const circuitJson = await runTscircuitCode(
+    {
+      "tsconfig.json": JSON.stringify({
+        compilerOptions: {
+          baseUrl: "./src",
+          paths: {
+            "@components/*": ["./components/*"],
+          },
+        },
+      }),
+      "src/components/res.tsx": `
+        export default () => (<resistor name="Rbase" resistance="1k" />)
+      `,
+      "user.tsx": `
+        import Resistor from "@components/res"
+        export default () => (<Resistor />)
+      `,
+    },
+    {
+      mainComponentPath: "user",
+    },
+  )
+
+  const resistor = circuitJson.find(
+    (el) => el.type === "source_component" && el.name === "Rbase",
+  ) as any
+  expect(resistor).toBeDefined()
+  expect(resistor.resistance).toBe(1000)
+})