diff --git a/CHANGELOG b/CHANGELOG
index 3c42d93fe..672a61955 100644
--- a/CHANGELOG
+++ b/CHANGELOG
@@ -2,6 +2,9 @@
 Changes since U-Boot 1.1.4:
 ======================================================================
 
+* Fix LOG_DIR directory creation error.
+  Add support for automatic creation of BUILD_DIR directory.
+
 * Fix mkimage -l bug with multifile images on 64bit platforms
   Patch by David Updegraff, 06 Sep 2006
 
@@ -30,7 +33,6 @@ Changes since U-Boot 1.1.4:
 
 * Fix tools/easylogo build error.
 
-
 * Fixed problems on PRS200 board caused by adding splash screen on MCC200
 
 * Extended README entry on coding style
diff --git a/MAKEALL b/MAKEALL
index d2f86d3ac..112be32ab 100755
--- a/MAKEALL
+++ b/MAKEALL
@@ -18,7 +18,7 @@ if [ ! "${BUILD_DIR}" ] ; then
 	BUILD_DIR="."
 fi
 
-[ -d ${MAKEALL_LOGDIR} ] || mkdir ${MAKEALL_LOGDIR} || exit 1
+[ -d ${LOG_DIR} ] || mkdir ${LOG_DIR} || exit 1
 
 LIST=""
 
diff --git a/Makefile b/Makefile
index fc7b117e3..a4aa19f0d 100644
--- a/Makefile
+++ b/Makefile
@@ -74,6 +74,11 @@ endif
 
 ifneq ($(BUILD_DIR),)
 saved-output := $(BUILD_DIR)
+
+# Attempt to create a output directory.
+$(shell [ -d ${BUILD_DIR} ] || mkdir -p ${BUILD_DIR})
+
+# Verify if it was successful. 
 BUILD_DIR := $(shell cd $(BUILD_DIR) && /bin/pwd)
 $(if $(BUILD_DIR),,$(error output directory "$(saved-output)" does not exist))
 endif # ifneq ($(BUILD_DIR),)