diff --git a/packages/wxt/e2e/tests/output-structure.test.ts b/packages/wxt/e2e/tests/output-structure.test.ts
index 2ff8aab1..260157ae 100644
--- a/packages/wxt/e2e/tests/output-structure.test.ts
+++ b/packages/wxt/e2e/tests/output-structure.test.ts
@@ -362,7 +362,7 @@ describe('Output Directory Structure', () => {
       .toMatchInlineSnapshot(`
         ".output/chrome-mv3/background.js
         ----------------------------------------
-        var _background = function() {
+        var background = function() {
           "use strict";
           var _a, _b;
           function defineBackground(arg) {
@@ -372,13 +372,13 @@ describe('Output Directory Structure', () => {
           function logHello(name) {
             console.log(\`Hello \${name}!\`);
           }
-          _background;
+          background;
           const definition = defineBackground({
             main() {
               logHello("background");
             }
           });
-          _background;
+          background;
           function initPlugins() {
           }
           // @ts-expect-error
@@ -411,7 +411,7 @@ describe('Output Directory Structure', () => {
           const result$1 = result;
           return result$1;
         }();
-        _background;
+        background;
         "
       `);
   });
diff --git a/packages/wxt/package.json b/packages/wxt/package.json
index 5652a97d..7da3eb74 100644
--- a/packages/wxt/package.json
+++ b/packages/wxt/package.json
@@ -118,6 +118,7 @@
     "picocolors": "^1.0.1",
     "prompts": "^2.4.2",
     "publish-browser-extension": "^2.1.3",
+    "scule": "^1.3.0",
     "unimport": "^3.9.1",
     "vite": "^5.3.5",
     "vite-node": "^2.0.4",
diff --git a/packages/wxt/src/core/utils/__tests__/strings.test.ts b/packages/wxt/src/core/utils/__tests__/strings.test.ts
index 8974b64c..f1dbce8b 100644
--- a/packages/wxt/src/core/utils/__tests__/strings.test.ts
+++ b/packages/wxt/src/core/utils/__tests__/strings.test.ts
@@ -21,9 +21,10 @@ describe('String utils', () => {
 
   describe('safeVarName', () => {
     it.each([
-      ['Hello world!', '_hello_world'],
+      ['Hello world!', 'helloWorld'],
       ['123', '_123'],
-      ['abc-123', '_abc_123'],
+      ['abc-123', 'abc123'],
+      ['abc-123-xyz', 'abc123Xyz'],
       ['', '_'],
       [' ', '_'],
       ['_', '_'],
diff --git a/packages/wxt/src/core/utils/strings.ts b/packages/wxt/src/core/utils/strings.ts
index 1e3df534..b48b7995 100644
--- a/packages/wxt/src/core/utils/strings.ts
+++ b/packages/wxt/src/core/utils/strings.ts
@@ -1,3 +1,5 @@
+import { camelCase } from 'scule';
+
 export function kebabCaseAlphanumeric(str: string): string {
   return str
     .toLowerCase()
@@ -9,8 +11,17 @@ export function kebabCaseAlphanumeric(str: string): string {
  * Return a safe variable name for a given string.
  */
 export function safeVarName(str: string): string {
-  // _ prefix to ensure it doesn't start with a number
-  return '_' + kebabCaseAlphanumeric(str.trim()).replace('-', '_');
+  const name = camelCase(kebabCaseAlphanumeric(str));
+  if (name.match(/^[a-z]/)) return name;
+  // _ prefix to ensure it doesn't start with a number or other invalid symbol
+  return '_' + name;
+}
+
+/**
+ * Converts a string to a valid filename (NOT path), stripping out invalid characters.
+ */
+export function safeFilename(str: string): string {
+  return kebabCaseAlphanumeric(str);
 }
 
 /**
diff --git a/packages/wxt/src/core/zip.ts b/packages/wxt/src/core/zip.ts
index 534994fb..9226a48f 100644
--- a/packages/wxt/src/core/zip.ts
+++ b/packages/wxt/src/core/zip.ts
@@ -1,7 +1,7 @@
 import { InlineConfig } from '../types';
 import path from 'node:path';
 import fs from 'fs-extra';
-import { kebabCaseAlphanumeric } from './utils/strings';
+import { safeFilename } from './utils/strings';
 import { getPackageJson } from './utils/package';
 import { minimatch } from 'minimatch';
 import { formatDuration } from './utils/time';
@@ -27,9 +27,7 @@ export async function zip(config?: InlineConfig): Promise<string[]> {
 
   const projectName =
     wxt.config.zip.name ??
-    kebabCaseAlphanumeric(
-      (await getPackageJson())?.name || path.dirname(process.cwd()),
-    );
+    safeFilename((await getPackageJson())?.name || path.dirname(process.cwd()));
   const applyTemplate = (template: string): string =>
     template
       .replaceAll('{{name}}', projectName)
diff --git a/pnpm-lock.yaml b/pnpm-lock.yaml
index 0c5d1736..fcb3fedb 100644
--- a/pnpm-lock.yaml
+++ b/pnpm-lock.yaml
@@ -374,6 +374,9 @@ importers:
       publish-browser-extension:
         specifier: ^2.1.3
         version: 2.1.3
+      scule:
+        specifier: ^1.3.0
+        version: 1.3.0
       unimport:
         specifier: ^3.9.1
         version: 3.9.1(rollup@4.19.0)