diff --git a/config/dev.exs b/config/dev.exs
index b88a4221a..7ee06c0c4 100644
--- a/config/dev.exs
+++ b/config/dev.exs
@@ -71,3 +71,5 @@ config :phoenix, :plug_init_mode, :runtime
 
 # Disable authentication mode during dev
 config :livebook, :authentication_mode, :disabled
+
+config :livebook, :data_path, Path.expand("tmp/livebook_data/dev")
diff --git a/config/test.exs b/config/test.exs
index 384cc55c9..05d6b225d 100644
--- a/config/test.exs
+++ b/config/test.exs
@@ -14,6 +14,8 @@ config :logger, level: :warn
 # Disable authentication mode during test
 config :livebook, :authentication_mode, :disabled
 
+config :livebook, :data_path, Path.expand("tmp/livebook_data/test")
+
 # Use the embedded runtime in tests by default, so they
 # are cheaper to run. Other runtimes can be tested by starting
 # and setting them explicitly
diff --git a/lib/livebook/application.ex b/lib/livebook/application.ex
index aec03e107..939d88069 100644
--- a/lib/livebook/application.ex
+++ b/lib/livebook/application.ex
@@ -6,7 +6,8 @@ defmodule Livebook.Application do
   use Application
 
   def start(_type, _args) do
-    ensure_local_filesystem!()
+    ensure_directories!()
+    set_local_filesystem!()
     ensure_distribution!()
     validate_hostname_resolution!()
     set_cookie()
@@ -55,7 +56,12 @@ defmodule Livebook.Application do
     :ok
   end
 
-  defp ensure_local_filesystem!() do
+  defp ensure_directories!() do
+    File.mkdir_p!(Livebook.Config.home())
+    File.mkdir_p!(Livebook.Config.data_path())
+  end
+
+  defp set_local_filesystem!() do
     home =
       Livebook.Config.home()
       |> Livebook.FileSystem.Utils.ensure_dir_path()