diff --git a/compiler/compiler-runner/src/org/jetbrains/kotlin/compilerRunner/KotlinCompilerRunner.kt b/compiler/compiler-runner/src/org/jetbrains/kotlin/compilerRunner/KotlinCompilerRunner.kt
index 3bf41957fab..89934bd1639 100644
--- a/compiler/compiler-runner/src/org/jetbrains/kotlin/compilerRunner/KotlinCompilerRunner.kt
+++ b/compiler/compiler-runner/src/org/jetbrains/kotlin/compilerRunner/KotlinCompilerRunner.kt
@@ -57,8 +57,7 @@ abstract class KotlinCompilerRunner<in Env : CompilerEnvironment> {
     protected abstract fun getDaemonConnection(environment: Env): DaemonConnection
 
     @Synchronized
-    protected fun newDaemonConnection(compilerId: CompilerId, flagFile: File, environment: Env): DaemonConnection {
-        val daemonOptions = configureDaemonOptions()
+    protected fun newDaemonConnection(compilerId: CompilerId, flagFile: File, environment: Env, daemonOptions: DaemonOptions = configureDaemonOptions()): DaemonConnection {
         val daemonJVMOptions = configureDaemonJVMOptions(inheritMemoryLimits = true, inheritAdditionalProperties = true)
 
         val daemonReportMessages = ArrayList<DaemonReportMessage>()
diff --git a/compiler/daemon/daemon-client/src/org/jetbrains/kotlin/daemon/client/KotlinCompilerClient.kt b/compiler/daemon/daemon-client/src/org/jetbrains/kotlin/daemon/client/KotlinCompilerClient.kt
index d7f93107058..0574a707599 100644
--- a/compiler/daemon/daemon-client/src/org/jetbrains/kotlin/daemon/client/KotlinCompilerClient.kt
+++ b/compiler/daemon/daemon-client/src/org/jetbrains/kotlin/daemon/client/KotlinCompilerClient.kt
@@ -60,7 +60,7 @@ object KotlinCompilerClient {
                      ?.check { !it.isBlank() }
                      ?.let(::File)
                      ?.check(File::exists)
-                     ?: makeAutodeletingFlagFile()
+                     ?: makeAutodeletingFlagFile(baseDir = File(daemonOptions.runFilesPathOrDefault))
         return connectToCompileService(compilerId, flagFile, daemonJVMOptions, daemonOptions, reportingTargets, autostart)
     }
 
diff --git a/compiler/daemon/daemon-common/src/org/jetbrains/kotlin/daemon/common/ClientUtils.kt b/compiler/daemon/daemon-common/src/org/jetbrains/kotlin/daemon/common/ClientUtils.kt
index 786a8f38170..a02c1bab172 100644
--- a/compiler/daemon/daemon-common/src/org/jetbrains/kotlin/daemon/common/ClientUtils.kt
+++ b/compiler/daemon/daemon-common/src/org/jetbrains/kotlin/daemon/common/ClientUtils.kt
@@ -81,10 +81,10 @@ private inline fun tryConnectToDaemon(port: Int, report: (DaemonReportCategory,
     return null
 }
 
+private const val validFlagFileKeywordChars = "abcdefghijklmnopqrstuvwxyz0123456789-_"
 
-fun makeAutodeletingFlagFile(keyword: String = "compiler-client"): File {
-    val validChars = "^a-zA-Z0-9-_"
-    val flagFile = File.createTempFile("kotlin-${keyword.filter { validChars.contains(it) }}-", "-is-running")
+fun makeAutodeletingFlagFile(keyword: String = "compiler-client", baseDir: File? = null): File {
+    val flagFile = File.createTempFile("kotlin-${keyword.filter { validFlagFileKeywordChars.contains(it.toLowerCase()) }}-", "-is-running", baseDir?.takeIf { it.isDirectory && it.exists() })
     flagFile.deleteOnExit()
     return flagFile
 }
diff --git a/compiler/daemon/src/org/jetbrains/kotlin/daemon/CompileServiceImpl.kt b/compiler/daemon/src/org/jetbrains/kotlin/daemon/CompileServiceImpl.kt
index 885fe9f37c4..b195caeb7bd 100644
--- a/compiler/daemon/src/org/jetbrains/kotlin/daemon/CompileServiceImpl.kt
+++ b/compiler/daemon/src/org/jetbrains/kotlin/daemon/CompileServiceImpl.kt
@@ -328,7 +328,7 @@ class CompileServiceImpl(
             compilationOptions: CompilationOptions,
             servicesFacade: CompilerServicesFacadeBase,
             compilationResults: CompilationResults?
-    ): CompileService.CallResult<Int> {
+    ): CompileService.CallResult<Int> = ifAlive {
         val messageCollector = CompileServicesFacadeMessageCollector(servicesFacade, compilationOptions)
         val daemonReporter = DaemonMessageReporter(servicesFacade, compilationOptions)
         val compilerMode = compilationOptions.compilerMode
@@ -342,10 +342,10 @@ class CompileServiceImpl(
         }
         catch (e: IllegalArgumentException) {
             messageCollector.report(CompilerMessageSeverity.EXCEPTION, e.stackTraceStr, CompilerMessageLocation.NO_LOCATION)
-            return CompileService.CallResult.Error("Could not deserialize compiler arguments")
+            return@ifAlive CompileService.CallResult.Error("Could not deserialize compiler arguments")
         }
 
-        return when (compilerMode) {
+        return@ifAlive when (compilerMode) {
             CompilerMode.JPS_COMPILER -> {
                 val jpsServicesFacade = servicesFacade as JpsCompilerServicesFacade
 
diff --git a/jps-plugin/src/org/jetbrains/kotlin/compilerRunner/JpsKotlinCompilerRunner.kt b/jps-plugin/src/org/jetbrains/kotlin/compilerRunner/JpsKotlinCompilerRunner.kt
index a557b301749..22f2f111759 100644
--- a/jps-plugin/src/org/jetbrains/kotlin/compilerRunner/JpsKotlinCompilerRunner.kt
+++ b/jps-plugin/src/org/jetbrains/kotlin/compilerRunner/JpsKotlinCompilerRunner.kt
@@ -206,10 +206,10 @@ class JpsKotlinCompilerRunner : KotlinCompilerRunner<JpsCompilerEnvironment>() {
             val libPath = CompilerRunnerUtil.getLibPath(environment.kotlinPaths, environment.messageCollector)
             val compilerPath = File(libPath, "kotlin-compiler.jar")
             val compilerId = CompilerId.makeCompilerId(compilerPath)
-            val flagFile = File.createTempFile("kotlin-compiler-jps-session-", "-is-running").apply {
-                deleteOnExit()
-            }
-            jpsDaemonConnection = newDaemonConnection(compilerId, flagFile, environment)
+            // TODO: pass daemon options to newDaemonConnection
+            val daemonOptions = configureDaemonOptions()
+            val flagFile = makeAutodeletingFlagFile("compiler-jps-session-", File(daemonOptions.runFilesPathOrDefault))
+            jpsDaemonConnection = newDaemonConnection(compilerId, flagFile, environment, daemonOptions)
         }
         return jpsDaemonConnection!!
     }