diff --git a/packages/core/src/lib/object_factory.js b/packages/core/src/lib/object_factory.js
index 77e32b5cf..83524a9c7 100644
--- a/packages/core/src/lib/object_factory.js
+++ b/packages/core/src/lib/object_factory.js
@@ -35,6 +35,9 @@ const Pattern = function(relPath, data, patternlab) {
   this.relPath = path.normalize(relPath); // '00-atoms/00-global/00-colors.mustache'
   this.fileName = pathObj.name; // '00-colors'
   this.subdir = pathObj.dir; // '00-atoms/00-global'
+  if ((this.subdir.match(/\w(?=\\)|\w(?=\/)/g) || []).length > 1) {
+    this.subdir = this.subdir.split(/\/|\\/, 2).join(path.sep); // '00-atoms/03-controls/00-button' -> '00-atoms/03-controls'
+  }
   this.fileExtension = pathObj.ext; // '.mustache'
 
   // this is the unique name, subDir + fileName (sans extension)
diff --git a/packages/core/test/object_factory_tests.js b/packages/core/test/object_factory_tests.js
index 92d46cc17..81f5f4ad4 100644
--- a/packages/core/test/object_factory_tests.js
+++ b/packages/core/test/object_factory_tests.js
@@ -79,10 +79,10 @@ tap.test(
         path.sep +
         'colors.mustache'
     );
-    test.equals(p.name, '00-atoms-00-global-00-colors');
+    test.equals(p.name, '00-atoms-00-global');
     test.equals(
       p.subdir,
-      '00-atoms' + path.sep + '00-global' + path.sep + '00-colors'
+      '00-atoms' + path.sep + '00-global'
     );
     test.equals(p.fileName, 'colors');
     test.equals(p.fileExtension, '.mustache');
@@ -91,12 +91,12 @@ tap.test(
     test.equals(p.patternName, 'Colors');
     test.equals(
       p.getPatternLink(pl),
-      '00-atoms-00-global-00-colors' +
+      '00-atoms-00-global' +
         path.sep +
-        '00-atoms-00-global-00-colors.rendered.html'
+        '00-atoms-00-global.rendered.html'
     );
     test.equals(p.patternGroup, 'atoms');
-    test.equals(p.patternSubGroup, 'global');
+    test.equals(p.patternSubGroup, 'atoms'); //because of p.info.hasDir
     test.equals(p.flatPatternPath, '00-atoms-00-global');
     test.equals(p.patternPartial, 'atoms-colors');
     test.equals(p.template, '');
@@ -111,15 +111,15 @@ tap.test(
 );
 
 tap.test('test Pattern name for variants correctly initialzed', function(test) {
-  var p1 = new Pattern('00-atoms/00-global/00-colors/colors~variant.mustache', {
+  var p1 = new Pattern('00-atoms/00-global/colors~variant.mustache', {
     d: 123,
   });
   var p2 = new Pattern(
-    '00-atoms/00-global/00-colors/colors~variant-minus.json',
+    '00-atoms/00-global/colors~variant-minus.json',
     { d: 123 }
   );
-  test.equals(p1.name, '00-atoms-00-global-00-colors-variant');
-  test.equals(p2.name, '00-atoms-00-global-00-colors-variant-minus');
+  test.equals(p1.name, '00-atoms-00-global-colors-variant');
+  test.equals(p2.name, '00-atoms-00-global-colors-variant-minus');
   test.end();
 });
 
@@ -205,11 +205,8 @@ tap.test(
       { d: 123 }
     );
     test.equals(p.getDirLevel(0, { hasDir: true, dirLevel: 3 }), '00-atoms');
-    test.equals(p.getDirLevel(1, { hasDir: true, dirLevel: 3 }), '00-global');
-    test.equals(
-      p.getDirLevel(3, { hasDir: true, dirLevel: 3 }),
-      '00-colors-alt'
-    );
+    test.equals(p.getDirLevel(1, { hasDir: true, dirLevel: 3 }), '00-atoms');
+    test.equals(p.getDirLevel(3, { hasDir: true, dirLevel: 3 }), '');
     var p = new Pattern('00-atoms/00-colors-alt/colors-alt.mustache', {
       d: 123,
     });