diff --git a/Makefile b/Makefile
index d689a86..86177ae 100644
--- a/Makefile
+++ b/Makefile
@@ -1,9 +1,11 @@
-ifneq ($O,)
-	out-dir := $O
+ifeq ($O,)
+out-dir := $(CURDIR)/out
 else
-	# If no build folder has been specified, then create all build files in
-	# the current directory under a folder named out.
-	out-dir := $(CURDIR)/out
+include scripts/common.mk
+out-dir := $(call strip-trailing-slashes-and-dots,$(O))
+ifeq ($(out-dir),)
+$(error invalid output directory (O=$(O)))
+endif
 endif
 
 -include $(TA_DEV_KIT_DIR)/host_include/conf.mk
@@ -15,6 +17,8 @@
 	q :=
 	echo := @:
 endif
+# export 'q', used by sub-makefiles.
+export q
 
 # If _HOST or _TA specific compilers are not specified, then use CROSS_COMPILE
 CROSS_COMPILE_HOST ?= $(CROSS_COMPILE)
@@ -32,22 +36,20 @@
 xtest:
 	$(q)$(MAKE) -C host/xtest CROSS_COMPILE="$(CROSS_COMPILE_HOST)" \
 			     --no-builtin-variables \
-			     q=$(q) \
-			     O=$(out-dir)/xtest \
+			     O=$(out-dir) \
 			     $@
 
 .PHONY: ta
 ta:
 	$(q)$(MAKE) -C ta CROSS_COMPILE="$(CROSS_COMPILE_TA)" \
-			  q=$(q) \
-			  O=$(out-dir)/ta \
+			  O=$(out-dir) \
 			  $@
 
 .PHONY: clean
 ifneq ($(wildcard $(TA_DEV_KIT_DIR)/host_include/conf.mk),)
 clean:
-	$(q)$(MAKE) -C host/xtest O=$(out-dir)/xtest q=$(q) $@
-	$(q)$(MAKE) -C ta O=$(out-dir)/ta q=$(q) $@
+	$(q)$(MAKE) -C host/xtest O=$(out-dir) $@
+	$(q)$(MAKE) -C ta O=$(out-dir) $@
 else
 clean:
 	$(q)echo "TA_DEV_KIT_DIR is not correctly defined"
diff --git a/host/xtest/Makefile b/host/xtest/Makefile
index 8342e3c..ff497cc 100644
--- a/host/xtest/Makefile
+++ b/host/xtest/Makefile
@@ -1,8 +1,11 @@
 # Normally this makefile shouldn't be called directly and we expect the output
 # path to be on a certain location to fit together with the other OP-TEE
 # gits and helper scripts.
-ifeq ($O,)
-$(error output path should be specified when calling this makefile)
+
+include ../../scripts/common.mk
+out-dir := $(call strip-trailing-slashes-and-dots,$(O))
+ifeq ($(out-dir),)
+$(error invalid output directory (O=$(O)))
 endif
 
 include $(TA_DEV_KIT_DIR)/host_include/conf.mk
@@ -62,7 +65,7 @@
 	 xtest_9000.c
 endif
 
-objs 	:= $(patsubst %.c,$(O)/%.o, $(srcs))
+objs 	:= $(patsubst %.c,$(out-dir)/xtest/%.o, $(srcs))
 
 CFLAGS += -I./
 CFLAGS += -I./adbg/include
@@ -142,16 +145,24 @@
 all: xtest
 
 xtest: $(objs)
-	@echo "  LD      $(O)/$@"
-	$(q)@$(CC) -o $(O)/$@ $+ $(LDFLAGS)
+	@echo "  LD      $(out-dir)/xtest/$@"
+	$(q)@$(CC) -o $(out-dir)/xtest/$@ $+ $(LDFLAGS)
 
-$(O)/%.o: $(CURDIR)/%.c
-	$(q)mkdir -p $(O)/adbg/src
+$(out-dir)/xtest/%.o: $(CURDIR)/%.c
+	$(q)mkdir -p $(out-dir)/xtest/adbg/src
 	@echo '  CC      $<'
 	$(q)$(CC) $(CFLAGS) -c $< -o $@
 
+RMDIR := rmdir --ignore-fail-on-non-empty
+define rm-build-dirs
+	$(q)for d in $1; do $(RMDIR) $(out-dir)/xtest/$$d 2> /dev/null; true; done
+	$(q)$(RMDIR) $(out-dir)/xtest 2> /dev/null; true
+	$(q)$(RMDIR) $(out-dir) 2> /dev/null; true
+endef
+
 .PHONY: clean
 clean:
-	@echo '  CLEAN $(O)'
-	$(q)rm -f $(O)/xtest
+	@echo '  CLEAN $(out-dir)'
+	$(q)rm -f $(out-dir)/xtest/xtest
 	$(q)$(foreach obj,$(objs), rm -f $(obj))
+	$(call rm-build-dirs,adbg/src adbg)
diff --git a/scripts/common.mk b/scripts/common.mk
new file mode 100644
index 0000000..103a415
--- /dev/null
+++ b/scripts/common.mk
@@ -0,0 +1,9 @@
+# Makefile script used in various OP-TEE test components
+
+# Since 'clean' make rules rely on 'rmdir', removed directories shall
+# not end with 'current directory' (./ or .) subpath information.
+# This macro remove trailing './' info from input path.
+define strip-trailing-slashes-and-dots
+$(eval _o := $(patsubst %/,%,$(patsubst %/.,%,$(1))))$(if \
+	$(filter-out $(1),$(_o)),$(call strip-trailing-slashes-and-dots,$(_o)),$(_o))
+endef
diff --git a/ta/Makefile b/ta/Makefile
index bcc7723..e3917a7 100644
--- a/ta/Makefile
+++ b/ta/Makefile
@@ -1,8 +1,11 @@
 # Normally this makefile shouldn't be called directly and we expect the output
 # path to be on a certain location to fit together with the other OP-TEE
 # gits and helper scripts.
-ifeq ($O,)
-$(error output path should be specified when calling this makefile)
+
+include ../scripts/common.mk
+out-dir := $(call strip-trailing-slashes-and-dots,$(O))
+ifeq ($(out-dir),)
+$(error invalid output directory (O=$(O)))
 endif
 
 # Prevent use of LDFLAGS from the environment. For example, yocto exports
@@ -45,8 +48,16 @@
 
 .PHONY: ta
 ta: 
-	$(q)$(foreach dir,$(TA_DIRS), $(MAKE) -C $(dir) O=$(O)/$(dir) &&) true
+	$(q)$(foreach dir,$(TA_DIRS), $(MAKE) -C $(dir) O=$(out-dir)/ta/$(dir) &&) true
+
+# remove build directories including ta/<ta-name>/ directories.
+# Note: $(out-dir) may be a relative path.
+RMDIR := rmdir --ignore-fail-on-non-empty
+define rm-build-subdir
+echo `[ -d $1 ] && { cd $1; $(RMDIR) $(out-dir)/ta $(out-dir) 2> /dev/null; true; }` > /dev/null
+endef
 
 .PHONY: clean
 clean:
-	$(q)$(foreach dir,$(TA_DIRS), $(MAKE) -C $(dir) O=$(O)/$(dir) $@ &&) true
+	$(q)$(foreach dir,$(TA_DIRS), $(MAKE) -C $(dir) O=$(out-dir)/ta/$(dir) $@ &&) true
+	$(q)$(foreach dir,$(TA_DIRS), $(call rm-build-subdir,$(dir));)