diff --git a/src/AddIns/BackendBindings/WixBinding/Project/Src/WixComponentElement.cs b/src/AddIns/BackendBindings/WixBinding/Project/Src/WixComponentElement.cs
index f56d02ff2b..c1765a614b 100644
--- a/src/AddIns/BackendBindings/WixBinding/Project/Src/WixComponentElement.cs
+++ b/src/AddIns/BackendBindings/WixBinding/Project/Src/WixComponentElement.cs
@@ -132,7 +132,7 @@ namespace ICSharpCode.WixBinding
 			if (extension.Length > 1) {
 				idEnd = FirstCharacterToUpperInvariant(extension.Substring(1));
 			}
-			return String.Concat(idStart, idEnd);
+			return WixFileElement.GenerateId(String.Concat(idStart, idEnd));
 		}
 		
 		/// <summary>
diff --git a/src/AddIns/BackendBindings/WixBinding/Project/Src/WixDirectoryElementBase.cs b/src/AddIns/BackendBindings/WixBinding/Project/Src/WixDirectoryElementBase.cs
index c2188bbf6a..0aee4cd58d 100644
--- a/src/AddIns/BackendBindings/WixBinding/Project/Src/WixDirectoryElementBase.cs
+++ b/src/AddIns/BackendBindings/WixBinding/Project/Src/WixDirectoryElementBase.cs
@@ -77,7 +77,7 @@ namespace ICSharpCode.WixBinding
 		public WixDirectoryElement AddDirectory(string name)
 		{
 			WixDirectoryElement directoryElement = new WixDirectoryElement((WixDocument)OwnerDocument);
-			directoryElement.Id = name;
+			directoryElement.Id = WixFileElement.GenerateId(name);
 			SetDirectoryName(directoryElement, name);
 			return (WixDirectoryElement)AppendChild(directoryElement);
 		}
diff --git a/src/AddIns/BackendBindings/WixBinding/Test/DirectoryImport/AddDirectoryWithInvalidIdCharsTestFixture.cs b/src/AddIns/BackendBindings/WixBinding/Test/DirectoryImport/AddDirectoryWithInvalidIdCharsTestFixture.cs
new file mode 100644
index 0000000000..9478931b7e
--- /dev/null
+++ b/src/AddIns/BackendBindings/WixBinding/Test/DirectoryImport/AddDirectoryWithInvalidIdCharsTestFixture.cs
@@ -0,0 +1,50 @@
+// <file>
+//     <copyright see="prj:///doc/copyright.txt"/>
+//     <license see="prj:///doc/license.txt"/>
+//     <owner name="Matthew Ward" email="mrward@users.sourceforge.net"/>
+//     <version>$Revision$</version>
+// </file>
+
+using ICSharpCode.WixBinding;
+using NUnit.Framework;
+using System;
+
+namespace WixBinding.Tests.DirectoryImport
+{
+	[TestFixture]
+	public class AddDirectoryWithInvalidIdCharsTestFixture
+	{
+		WixDocument document;
+		
+		[SetUp]
+		public void Init()
+		{
+			document = new WixDocument();
+			document.FileName = @"C:\Projects\Test\Setup.wxs";
+			document.LoadXml(GetWixXml());
+		}
+		
+		[Test]
+		public void AddDirectoryWithHyphen()
+		{
+			string directoryName = "Test-directory";
+			WixDirectoryElement element = document.RootDirectory.AddDirectory(directoryName);
+			Assert.AreEqual("Test_directory", element.Id);
+		}
+		
+		string GetWixXml()
+		{
+			return "<Wix xmlns=\"http://schemas.microsoft.com/wix/2003/01/wi\">\r\n" +
+				"\t<Product Name=\"MySetup\" \r\n" +
+				"\t         Manufacturer=\"\" \r\n" +
+				"\t         Id=\"F4A71A3A-C271-4BE8-B72C-F47CC956B3AA\" \r\n" +
+				"\t         Language=\"1033\" \r\n" +
+				"\t         Version=\"1.0.0.0\">\r\n" +
+				"\t\t<Package Id=\"6B8BE64F-3768-49CA-8BC2-86A76424DFE9\"/>\r\n" +
+				"\t\t<Directory Id=\"TARGETDIR\" SourceName=\"SourceDir\">\r\n" +
+				"\t\t</Directory>\r\n" +
+				"\t</Product>\r\n" +
+				"</Wix>";
+		}
+	}
+}
diff --git a/src/AddIns/BackendBindings/WixBinding/Test/PackageFiles/GenerateComponentIdTests.cs b/src/AddIns/BackendBindings/WixBinding/Test/PackageFiles/GenerateComponentIdTests.cs
index b89ad0a6e5..8cf9dc5d83 100644
--- a/src/AddIns/BackendBindings/WixBinding/Test/PackageFiles/GenerateComponentIdTests.cs
+++ b/src/AddIns/BackendBindings/WixBinding/Test/PackageFiles/GenerateComponentIdTests.cs
@@ -47,5 +47,12 @@ namespace WixBinding.Tests.PackageFiles
 		{
 			Assert.AreEqual(String.Empty, WixComponentElement.GenerateIdFromFileName(String.Empty));
 		}
+		
+		[Test]
+		public void Hyphen()
+		{
+			string fileName = "a-b.txt";
+			Assert.AreEqual("A_bTxt", WixComponentElement.GenerateIdFromFileName(fileName));
+		}
 	}
 }
diff --git a/src/AddIns/BackendBindings/WixBinding/Test/WixBinding.Tests.csproj b/src/AddIns/BackendBindings/WixBinding/Test/WixBinding.Tests.csproj
index aeafaf305f..111b8c0fc5 100644
--- a/src/AddIns/BackendBindings/WixBinding/Test/WixBinding.Tests.csproj
+++ b/src/AddIns/BackendBindings/WixBinding/Test/WixBinding.Tests.csproj
@@ -229,6 +229,7 @@
     <Compile Include="Diff\ExcludedFilesTestFixture.cs" />
     <Compile Include="Diff\SameFileReferencedTwiceTestFixture.cs" />
     <Compile Include="Project\CanCompileTests.cs" />
+    <Compile Include="DirectoryImport\AddDirectoryWithInvalidIdCharsTestFixture.cs" />
   </ItemGroup>
   <ItemGroup>
     <ProjectReference Include="..\Project\WixBinding.csproj">