diff --git a/docs/guide/essentials/assets.md b/docs/guide/essentials/assets.md
index 98e60936..27f396f6 100644
--- a/docs/guide/essentials/assets.md
+++ b/docs/guide/essentials/assets.md
@@ -46,7 +46,7 @@ import image from '~/assets/image.png';
 
 ## `/public` Directory
 
-Files inside `<srcDir>/public/` are copied into the output folder as-is, without being processed by WXT's bundler.
+Files inside `<rootDir>/public/` are copied into the output folder as-is, without being processed by WXT's bundler.
 
 Here's how you access them:
 
@@ -81,6 +81,10 @@ img.src = imageUrl;
 
 :::
 
+:::warning
+Assets in the `public/` directory are **_not_** accessible in content scripts by default. To use a public asset in a content script, you must add it to your manifest's [`web_accessible_resources` array](/api/reference/wxt/type-aliases/UserManifest#web-accessible-resources).
+:::
+
 ## Inside Content Scripts
 
 Assets inside content scripts are a little different. By default, when you import an asset, it returns just the path to the asset. This is because Vite assumes you're loading assets from the same hostname.
diff --git a/docs/guide/essentials/project-structure.md b/docs/guide/essentials/project-structure.md
index d5634106..9992b5dd 100644
--- a/docs/guide/essentials/project-structure.md
+++ b/docs/guide/essentials/project-structure.md
@@ -60,14 +60,14 @@ After enabling it, your project structure should look like this:
 📂 {rootDir}/
    📁 .output/
    📁 .wxt/
+   📁 modules/
+   📁 public/
    📂 src/
       📁 assets/
       📁 components/
       📁 composables/
       📁 entrypoints/
       📁 hooks/
-      📁 modules/
-      📁 public/
       📁 utils/
       📄 app.config.ts
    📄 .env
diff --git a/packages/wxt-demo/src/modules/auto-icons.ts b/packages/wxt-demo/modules/auto-icons.ts
similarity index 100%
rename from packages/wxt-demo/src/modules/auto-icons.ts
rename to packages/wxt-demo/modules/auto-icons.ts
diff --git a/packages/wxt-demo/src/modules/example.ts b/packages/wxt-demo/modules/example.ts
similarity index 100%
rename from packages/wxt-demo/src/modules/example.ts
rename to packages/wxt-demo/modules/example.ts
diff --git a/packages/wxt-demo/src/modules/i18n.ts b/packages/wxt-demo/modules/i18n.ts
similarity index 100%
rename from packages/wxt-demo/src/modules/i18n.ts
rename to packages/wxt-demo/modules/i18n.ts
diff --git a/packages/wxt-demo/src/modules/unocss.ts b/packages/wxt-demo/modules/unocss.ts
similarity index 100%
rename from packages/wxt-demo/src/modules/unocss.ts
rename to packages/wxt-demo/modules/unocss.ts
diff --git a/packages/wxt/src/core/resolve-config.ts b/packages/wxt/src/core/resolve-config.ts
index 03dc263e..cd693a2f 100644
--- a/packages/wxt/src/core/resolve-config.ts
+++ b/packages/wxt/src/core/resolve-config.ts
@@ -89,14 +89,14 @@ export async function resolveConfig(
     srcDir,
     mergedConfig.entrypointsDir ?? 'entrypoints',
   );
-  const modulesDir = path.resolve(srcDir, mergedConfig.modulesDir ?? 'modules');
   if (await isDirMissing(entrypointsDir)) {
     logMissingDir(logger, 'Entrypoints', entrypointsDir);
   }
+  const modulesDir = path.resolve(root, mergedConfig.modulesDir ?? 'modules');
   const filterEntrypoints = mergedConfig.filterEntrypoints?.length
     ? new Set(mergedConfig.filterEntrypoints)
     : undefined;
-  const publicDir = path.resolve(srcDir, mergedConfig.publicDir ?? 'public');
+  const publicDir = path.resolve(root, mergedConfig.publicDir ?? 'public');
   const typesDir = path.resolve(wxtDir, 'types');
   const outBaseDir = path.resolve(root, mergedConfig.outDir ?? '.output');
   const modeSuffixes: Record<string, string | undefined> = {
diff --git a/packages/wxt/src/types.ts b/packages/wxt/src/types.ts
index 9383b575..3312075c 100644
--- a/packages/wxt/src/types.ts
+++ b/packages/wxt/src/types.ts
@@ -38,7 +38,7 @@ export interface InlineConfig {
    */
   entrypointsDir?: string;
   /**
-   * @default "${config.srcDir}/modules"
+   * @default "${config.root}/modules"
    */
   modulesDir?: string;
   /**