diff --git a/lib/metanorma/cli/collection.rb b/lib/metanorma/cli/collection.rb
index aab3940..fee0e29 100644
--- a/lib/metanorma/cli/collection.rb
+++ b/lib/metanorma/cli/collection.rb
@@ -26,11 +26,17 @@ def collection_file
         @collection_file ||= Metanorma::Collection.parse(file)
       end
 
+      def source_folder
+        @source_folder ||= Pathname.new(
+          File.dirname(File.expand_path(file)),
+        ).join("output").to_s
+      end
+
       def collection_options
-        {
+        @collection_options ||= {
           compile: @compile_options,
           coverpage: options.fetch(:coverpage, nil),
-          output_folder: options.fetch(:output_folder, nil),
+          output_folder: options.fetch(:output_folder, source_folder),
           format: collection_output_formats(options.fetch(:format, "")),
         }
       end
diff --git a/lib/metanorma/cli/command.rb b/lib/metanorma/cli/command.rb
index 8a9a902..5f33612 100644
--- a/lib/metanorma/cli/command.rb
+++ b/lib/metanorma/cli/command.rb
@@ -59,7 +59,7 @@ def compile(file_name = nil)
 
       desc "collection FILENAME", "Render HTML pages from XML/YAML colection"
       option :format, aliases: "-x", type: :string, desc: "Formats to generate"
-      option :output_folder, aliases: "-w", required: true, desc: "Directory to save compiled files"
+      option :output_folder, aliases: "-w", desc: "Directory to save compiled files"
       option :coverpage, aliases: "-c", desc: "Liquid template"
       option :agree_to_terms, type: :boolean, desc: "Agree / Disagree with all third-party licensing terms "\
                                                     "presented (WARNING: do know what you are agreeing with!)"
diff --git a/spec/acceptance/collection_spec.rb b/spec/acceptance/collection_spec.rb
index 108e289..4f4e88c 100644
--- a/spec/acceptance/collection_spec.rb
+++ b/spec/acceptance/collection_spec.rb
@@ -11,6 +11,11 @@
       run_metanorma_collection("collection1.xml")
       expect_generated_files_to_match_expectations
     end
+
+    it "usages file's path as default output folder" do
+      run_metanorma_collection("collection1.xml")
+      expect_generated_files_to_match_expectations
+    end
   end
 
   around(:each) do |example|
@@ -24,7 +29,6 @@ def run_metanorma_collection(filename)
     command = %W(
       collection #{filename}
       -x html
-      -w #{RESULTS}
       -c collection_cover.html
       --no-install-fonts
     )
diff --git a/spec/metanorma/cli/collection_spec.rb b/spec/metanorma/cli/collection_spec.rb
index b192c1b..b1b4e70 100644
--- a/spec/metanorma/cli/collection_spec.rb
+++ b/spec/metanorma/cli/collection_spec.rb
@@ -5,9 +5,16 @@
     context "with specified options" do
       it "compiles and renders the collection files" do
         collection = mock_collection_instance
-        Metanorma::Cli::Collection.render(collection_file, format: "html, pdf")
 
-        expect(collection).to have_received(:render).with(format: %I(html pdf))
+        Metanorma::Cli::Collection.render(
+          collection_file,
+          format: "html, pdf",
+          output_folder: "bilingual-brochure",
+        )
+
+        expect(collection).to have_received(:render).with(
+          format: %I(html pdf), output_folder: "bilingual-brochure",
+        )
       end
     end
 
@@ -25,6 +32,19 @@
         )
       end
     end
+
+    context "with missing options" do
+      it "usages the source as reference for options" do
+        collection = mock_collection_instance
+
+        Metanorma::Cli::Collection.render(collection_file)
+        output_path = File.dirname(collection_file.to_s)
+
+        expect(collection).to have_received(:render).with(
+          hash_including(output_folder: "#{output_path}/output"),
+        )
+      end
+    end
   end
 
   def collection_file(collection = "collection1.yml")