diff --git a/tools/idf_py_actions/serial_ext.py b/tools/idf_py_actions/serial_ext.py
index 464ae6a3bb..983731560f 100644
--- a/tools/idf_py_actions/serial_ext.py
+++ b/tools/idf_py_actions/serial_ext.py
@@ -387,7 +387,7 @@ def action_extensions(base_actions: Dict, project_path: str) -> Dict:
             generate_flash_encryption_key_args += ['--keylen', keylen]
         if extra_args['keyfile']:
             generate_flash_encryption_key_args += [extra_args['keyfile']]
-        RunTool('espsecure',  generate_flash_encryption_key_args, args.build_dir)()
+        RunTool('espsecure',  generate_flash_encryption_key_args, args.project_dir)()
 
     def secure_generate_signing_key(action: str, ctx: click.core.Context, args: PropertyDict, version: str, scheme: str, **extra_args: str) -> None:
         ensure_build_directory(args, ctx.info_name)
@@ -406,7 +406,7 @@ def action_extensions(base_actions: Dict, project_path: str) -> Dict:
             generate_signing_key_args += ['--scheme', scheme]
         if extra_args['keyfile']:
             generate_signing_key_args += [extra_args['keyfile']]
-        RunTool('espsecure', generate_signing_key_args, args.build_dir)()
+        RunTool('espsecure', generate_signing_key_args, args.project_dir)()
 
     def secure_sign_data(action: str,
                          ctx: click.core.Context,
diff --git a/tools/test_idf_py/test_idf_py.py b/tools/test_idf_py/test_idf_py.py
index e104651748..7d99776056 100755
--- a/tools/test_idf_py/test_idf_py.py
+++ b/tools/test_idf_py/test_idf_py.py
@@ -467,7 +467,7 @@ class TestSecureCommands(TestWrapperCommands):
                            'secure-encrypt-flash-data',
                            '--aes-xts',
                            '--keyfile',
-                           f'{self.flash_encryption_key}',
+                           f'../{self.flash_encryption_key}',
                            '--address',
                            '0x1000',
                            '--output',
@@ -484,7 +484,7 @@ class TestSecureCommands(TestWrapperCommands):
                            'secure-decrypt-flash-data',
                            '--aes-xts',
                            '--keyfile',
-                           f'{self.flash_encryption_key}',
+                           f'../{self.flash_encryption_key}',
                            '--address',
                            '0x1000',
                            '--output',
@@ -515,7 +515,7 @@ class TestSecureCommands(TestWrapperCommands):
                         '--version',
                         '2',
                         '--keyfile',
-                        self.signing_key,
+                        f'../{self.signing_key}',
                         '--output',
                         'bootloader-signed.bin',
                         'bootloader/bootloader.bin']