diff --git a/install b/install
index 67690b9a3..42cd373ca 100755
--- a/install
+++ b/install
@@ -99,7 +99,9 @@ else
     fi
 fi
 
-INSTALL_DIR=$HOME/.opencode/bin
+XDG_DATA_HOME="${XDG_DATA_HOME:-$HOME/.local/share}"
+INSTALL_DIR="$XDG_DATA_HOME/opencode/bin"
+LEGACY_DIR="$HOME/.opencode/bin"
 mkdir -p "$INSTALL_DIR"
 
 if [ -z "$requested_version" ]; then
@@ -148,6 +150,19 @@ check_version() {
     fi
 }
 
+migrate_legacy_installation() {
+    # Migrate from ~/.opencode/bin to XDG location if needed
+    if [ -d "$LEGACY_DIR" ] && [ "$LEGACY_DIR" != "$INSTALL_DIR" ]; then
+        if [ -f "$LEGACY_DIR/opencode" ]; then
+            print_message info "${MUTED}Migrating from ${NC}$LEGACY_DIR${MUTED} to ${NC}$INSTALL_DIR"
+            mv "$LEGACY_DIR/opencode" "$INSTALL_DIR/opencode" 2>/dev/null || true
+            # Try to clean up empty directories
+            rmdir "$LEGACY_DIR" 2>/dev/null || true
+            rmdir "$HOME/.opencode" 2>/dev/null || true
+        fi
+    fi
+}
+
 unbuffered_sed() {
     if echo | sed -u -e "" >/dev/null 2>&1; then
         sed -nu "$@"
@@ -260,6 +275,7 @@ download_and_install() {
 }
 
 check_version
+migrate_legacy_installation
 download_and_install