diff --git a/src/dirnode.cpp b/src/dirnode.cpp
index 150165cc..87335f3f 100644
--- a/src/dirnode.cpp
+++ b/src/dirnode.cpp
@@ -899,19 +899,27 @@ void RDirNode::calcEdges() {
 }
 
 void RDirNode::updateLabelOffset(float dt) {
-    if(!parent) return;
+    if (!parent) return;
 
-    vec2 new_offset(0.0f);
-
-    if (parent->getProjectedPos().y > projected_pos.y) {
-        // alignBottom
-        new_offset.y = label_size.y;
-    }
-
-    if (   (gGourceSettings.dir_name_position <= 0.5f && parent->getProjectedPos().x < projected_pos.x)
-        || (gGourceSettings.dir_name_position  > 0.5f && parent->getProjectedPos().x > projected_pos.x)) {
-        // alignRight
-        new_offset.x = label_size.x;
+    vec2 new_offset;
+    if (gGourceSettings.dir_name_position == 0.5f) {
+        //center the label
+        new_offset = label_size / vec2(2.0f);
+    } else {
+        const vec2 topLeft_align(-0.25f * label_size.y);
+        const vec2 bottomRight_align = label_size - topLeft_align;
+
+        new_offset.x = (parent->getProjectedPos().x > projected_pos.x ? bottomRight_align.x : topLeft_align.x);
+        new_offset.y = (parent->getProjectedPos().y < projected_pos.y ? bottomRight_align.y : topLeft_align.y);
+
+        //invert the alignment if dir_name_position > 0.5 and the angle is flat
+        if (gGourceSettings.dir_name_position > 0.5f) {
+            const vec2 dirVec = glm::abs(parent->getProjectedPos() - projected_pos);
+            if (dirVec.x > dirVec.y) {
+                new_offset.x = (new_offset.x == topLeft_align.x ? bottomRight_align.x : topLeft_align.x);
+                new_offset.y = (new_offset.y == topLeft_align.y ? bottomRight_align.y : topLeft_align.y);
+            }
+        }
     }
 
     if (label_offset != new_offset) {