diff --git a/RELEASE-NOTES.md b/RELEASE-NOTES.md
index f48f26ed..b80fd047 100644
--- a/RELEASE-NOTES.md
+++ b/RELEASE-NOTES.md
@@ -20,6 +20,7 @@ Project Page: https://github.com/a2stuff/a2d
 * Prevent scrollbar thumb jumping when not moved. ([#778](https://github.com/a2stuff/a2d/issues/778))
 * Package now includes ProDOS 2.4.3 and BASIC.system 1.7.
 * Improve appearance of buttons when clicked. c/o @buserror
+* Fix corruption issues when replacing files with folders and folders with anything during copy.
 
 ### Launcher
 * If starting from a folder, brand it as a system folder.
diff --git a/desktop/auxmem.s b/desktop/auxmem.s
index fab6f095..11ffbea3 100644
--- a/desktop/auxmem.s
+++ b/desktop/auxmem.s
@@ -285,6 +285,8 @@ str_large_copy_prompt:
         PASCAL_STRING res_string_errmsg_too_large_to_copy
 str_large_move_prompt:
         PASCAL_STRING res_string_errmsg_too_large_to_move
+str_no_overwrite_dir:
+        PASCAL_STRING res_string_errmsg_overwrite_dir
 
         ;; "Delete" dialog strings
 str_delete_confirm_prefix:
diff --git a/desktop/main.s b/desktop/main.s
index cea6a338..e740b485 100644
--- a/desktop/main.s
+++ b/desktop/main.s
@@ -11271,14 +11271,14 @@ file_entry_buf          .tag    FileEntry
 
         DEFINE_CLOSE_PARAMS close_src_params
         DEFINE_CLOSE_PARAMS close_dst_params
-        DEFINE_DESTROY_PARAMS destroy_params, src_path_buf
+        DEFINE_DESTROY_PARAMS destroy_src_params, src_path_buf
+        DEFINE_DESTROY_PARAMS destroy_dst_params, dst_path_buf
         DEFINE_OPEN_PARAMS open_src_params, src_path_buf, $0D00
         DEFINE_OPEN_PARAMS open_dst_params, dst_path_buf, $1100
         DEFINE_READ_PARAMS read_src_params, file_data_buffer, kBufSize
         DEFINE_WRITE_PARAMS write_dst_params, file_data_buffer, kBufSize
         DEFINE_CREATE_PARAMS create_params3, dst_path_buf, ACCESS_DEFAULT
 
-        DEFINE_SET_EOF_PARAMS set_eof_params, 0
         DEFINE_SET_MARK_PARAMS mark_src_params, 0
         DEFINE_SET_MARK_PARAMS mark_dst_params, 0
         DEFINE_ON_LINE_PARAMS on_line_params2,, $800
@@ -11767,7 +11767,7 @@ ok_dir: jsr     RemoveSrcPathSegment
         bpl     done
 
         ;; Was a move - delete file
-@retry: MLI_CALL DESTROY, destroy_params
+@retry: MLI_CALL DESTROY, destroy_src_params
         bcc     done
         cmp     #ERR_ACCESS_ERROR
         bne     :+
@@ -11886,13 +11886,14 @@ existing_size:
 ;;; ============================================================
 ;;; Common implementation used by both `CopyProcessSelectedFile`
 ;;; and `CopyProcessDirectoryEntry`
+;;; Output: C=0 on success, C=1 on failure
 
 .proc TryCreateDst
         bit     move_flag       ; same volume relink move?
     IF_VC
         ;; No, verify that there is room.
         jsr     CheckSpaceAndShowPrompt
-        bcs     failure
+        RTS_IF_CS
     END_IF
 
         ;; Copy file_type, aux_type, storage_type
@@ -11918,11 +11919,23 @@ existing_size:
         lda     #ST_LINKED_DIRECTORY
         sta     create_params3::storage_type
 :
-retry:  MLI_CALL CREATE, create_params3
-        bcc     success
 
-        cmp     #ERR_DUPLICATE_FILENAME
-        bne     err
+        ;; --------------------------------------------------
+retry:  jsr     GetDstFileInfo
+        bcs     create
+        cmp     #ERR_FILE_NOT_FOUND
+        beq     create
+
+        ;; File exists
+        lda     dst_file_info_params::storage_type
+        cmp     #ST_LINKED_DIRECTORY
+    IF_EQ
+        ;; TODO: In the future, prompt and recursively delete
+        param_call ShowAlertParams, AlertButtonOptions::OK, aux::str_no_overwrite_dir
+        jsr     SetCursorWatch
+        jmp     CloseFilesCancelDialog
+    END_IF
+        ;; Prompt to replace
         bit     all_flag
         bmi     yes
 
@@ -11936,12 +11949,16 @@ retry:  MLI_CALL CREATE, create_params3
         cmp     #kAlertResultAll
         bne     cancel
         copy    #$80, all_flag
-yes:    jsr     ApplyFileInfoAndSize
-        jmp     success
-
-cancel: jmp     CloseFilesCancelDialog
+yes:
+        MLI_CALL DESTROY, destroy_dst_params
+        bcs     retry
 
-err:    jsr     ShowErrorAlertDst
+        ;; --------------------------------------------------
+        ;; Create the file
+create:
+        MLI_CALL CREATE, create_params3
+        bcc     success
+        jsr     ShowErrorAlertDst
         jmp     retry
 
 success:
@@ -11957,6 +11974,8 @@ success:
 failure:
         sec
         rts
+
+cancel: jmp     CloseFilesCancelDialog
 .endproc ; TryCreateDst
 
 ;;; ============================================================
@@ -12128,7 +12147,7 @@ Start:  lda     DEVNUM
         ;; --------------------------------------------------
         ;; Delete the file at the source location.
 
-:       MLI_CALL DESTROY, destroy_params
+:       MLI_CALL DESTROY, destroy_src_params
         bcc     :+
         jsr     ShowErrorAlert
         jmp     :-
@@ -12436,7 +12455,7 @@ do_destroy:
 ;;; and `DeleteProcessDirectoryEntry`
 
 .proc DeleteFileCommon
-retry:  MLI_CALL DESTROY, destroy_params
+retry:  MLI_CALL DESTROY, destroy_src_params
         bcc     done
 
         ;; Failed - determine why, maybe try to unlock.
@@ -12974,32 +12993,6 @@ match:  lda     flag
 
 ;;; ============================================================
 
-.proc ApplyFileInfoAndSize
-:       jsr     CopyFileInfo
-        copy    #ACCESS_DEFAULT, dst_file_info_params::access
-        jsr     SetDstFileInfo
-        lda     src_file_info_params::file_type
-        cmp     #FT_DIRECTORY
-        beq     done
-
-        ;; If a regular file, open/set eof/close
-        MLI_CALL OPEN, open_dst_params
-        bcc     :+
-        jsr     ShowErrorAlertDst
-        jmp     :-              ; retry
-
-:       lda     open_dst_params::ref_num
-        sta     set_eof_params::ref_num
-        sta     close_dst_params::ref_num
-@retry: MLI_CALL SET_EOF, set_eof_params
-        bcc     close
-        jsr     ShowErrorAlertDst
-        jmp     @retry
-
-close:  MLI_CALL CLOSE, close_dst_params
-done:   rts
-.endproc ; ApplyFileInfoAndSize
-
 .proc CopyFileInfo
         COPY_BYTES 11, src_file_info_params::access, dst_file_info_params::access
         rts
diff --git a/desktop/res/desktop.res.da b/desktop/res/desktop.res.da
index 017c195d..86b25bc7 100644
--- a/desktop/res/desktop.res.da
+++ b/desktop/res/desktop.res.da
@@ -47,6 +47,7 @@
 .define res_string_prompt_overwrite "Den fil findes allerede. Vil du erstatte det?"
 .define res_string_errmsg_too_large_to_copy "Denne fil er for stor til at kopiere."
 .define res_string_errmsg_too_large_to_move "Denne fil er for stor til at flytte."
+.define res_string_errmsg_overwrite_dir "En mappe kan ikke erstattes af en anden vare. Slet det s} pr|v igen."
 .define res_string_prompt_delete_confirm_prefix "Er du sikker p}, at du vil slette "
 .define res_string_prompt_delete_confirm_suffix " permanent?"
 .define res_string_label_delete_count "Sletter: "
diff --git a/desktop/res/desktop.res.de b/desktop/res/desktop.res.de
index 55cbf3bb..c45c97be 100644
--- a/desktop/res/desktop.res.de
+++ b/desktop/res/desktop.res.de
@@ -47,6 +47,7 @@
 .define res_string_prompt_overwrite "Datei bereits vorhanden. ]berschreiben?"
 .define res_string_errmsg_too_large_to_copy "Datei zu gro~ zum Kopieren."
 .define res_string_errmsg_too_large_to_move "Datei zu gro~ zum Bewegen."
+.define res_string_errmsg_overwrite_dir "Ein Ordner kann nicht durch einen anderen Artikel ersetzt werden. L|schen Sie es und versuchen Sie es erneut."
 .define res_string_prompt_delete_confirm_prefix "M|chten Sie wirklich "
 .define res_string_prompt_delete_confirm_suffix " dauerhaft l|schen?"
 .define res_string_label_delete_count "L|schen: "
diff --git a/desktop/res/desktop.res.en b/desktop/res/desktop.res.en
index 153b98e4..39048965 100644
--- a/desktop/res/desktop.res.en
+++ b/desktop/res/desktop.res.en
@@ -47,6 +47,7 @@
 .define res_string_prompt_overwrite "That file already exists. Do you want to replace it?"
 .define res_string_errmsg_too_large_to_copy "This file is too large to copy."
 .define res_string_errmsg_too_large_to_move "This file is too large to move."
+.define res_string_errmsg_overwrite_dir "A folder cannot be replaced by another item. Delete it then try again."
 .define res_string_prompt_delete_confirm_prefix "Are you sure you want to permanently delete "
 .define res_string_prompt_delete_confirm_suffix "?"
 .define res_string_label_delete_count "Deleting: "
diff --git a/desktop/res/desktop.res.es b/desktop/res/desktop.res.es
index fb90afcf..937efa4f 100644
--- a/desktop/res/desktop.res.es
+++ b/desktop/res/desktop.res.es
@@ -47,6 +47,7 @@
 .define res_string_prompt_overwrite "El archivo ya existe. ]Quiere reemplazarlo?"
 .define res_string_errmsg_too_large_to_copy "Archivo demasiado grande para ser escrito."
 .define res_string_errmsg_too_large_to_move "Archivo demasiado grande para mover."
+.define res_string_errmsg_overwrite_dir "Una carpeta no puede ser reemplazada por otro elemento. Elim\x11elo y luego vuelva a intentarlo."
 .define res_string_prompt_delete_confirm_prefix "]Est\x10s seguro de que quieres eliminar permanentemente "
 .define res_string_prompt_delete_confirm_suffix "?"
 .define res_string_label_delete_count "Borrado: "
diff --git a/desktop/res/desktop.res.fr b/desktop/res/desktop.res.fr
index 2cb6aacf..1451730d 100644
--- a/desktop/res/desktop.res.fr
+++ b/desktop/res/desktop.res.fr
@@ -47,6 +47,7 @@
 .define res_string_prompt_overwrite "Le fichier existe d{j@. Voulez-vous le remplacer ?"
 .define res_string_errmsg_too_large_to_copy "Fichier trop grand."
 .define res_string_errmsg_too_large_to_move "Fichier trop large."
+.define res_string_errmsg_overwrite_dir "Un dossier ne peut pas etre remplac{ par un autre {l{ment. Supprimez-le puis r{essayez."
 .define res_string_prompt_delete_confirm_prefix "Voulez-vous vraiment supprimer d{finitivement "
 .define res_string_prompt_delete_confirm_suffix " ?"
 .define res_string_label_delete_count "Supprimer : "
diff --git a/desktop/res/desktop.res.it b/desktop/res/desktop.res.it
index fdaf2a9c..28ca9d5e 100644
--- a/desktop/res/desktop.res.it
+++ b/desktop/res/desktop.res.it
@@ -47,6 +47,7 @@
 .define res_string_prompt_overwrite "Il file esiste gi{. Vuoi sovrascriverlo?"
 .define res_string_errmsg_too_large_to_copy "File troppo grande."
 .define res_string_errmsg_too_large_to_move "File troppo grande."
+.define res_string_errmsg_overwrite_dir "Una cartella non pu| essere sostituita da un altro elemento. Elimina e poi riprova."
 .define res_string_prompt_delete_confirm_prefix "Sei sicuro di voler eliminare definitivamente "
 .define res_string_prompt_delete_confirm_suffix "?"
 .define res_string_label_delete_count "Cancellazione: "
diff --git a/desktop/res/desktop.res.nl b/desktop/res/desktop.res.nl
index a69a0ee8..48110ec1 100644
--- a/desktop/res/desktop.res.nl
+++ b/desktop/res/desktop.res.nl
@@ -47,6 +47,7 @@
 .define res_string_prompt_overwrite "Bestand bestaat al. Overschrijven?"
 .define res_string_errmsg_too_large_to_copy "Bestand te groot om te kopi\x10ren."
 .define res_string_errmsg_too_large_to_move "Bestand te groot om te verplaatsen."
+.define res_string_errmsg_overwrite_dir "Een map kan niet worden vervangen door een ander item. Verwijder het en probeer het opnieuw."
 .define res_string_prompt_delete_confirm_prefix "Weet je zeker dat je "
 .define res_string_prompt_delete_confirm_suffix " permanent wilt verwijderen?"
 .define res_string_label_delete_count "Wissen: "
diff --git a/desktop/res/desktop.res.pt b/desktop/res/desktop.res.pt
index b0f3ed07..5c7a163e 100644
--- a/desktop/res/desktop.res.pt
+++ b/desktop/res/desktop.res.pt
@@ -47,6 +47,7 @@
 .define res_string_prompt_overwrite "O arquivo j@ existe. Quer substituir?"
 .define res_string_errmsg_too_large_to_copy "Arquivo muito grande para gravar."
 .define res_string_errmsg_too_large_to_move "Arquivo muito grande para mover."
+.define res_string_errmsg_overwrite_dir "Uma pasta n[o pode ser substitu{da por outro item. Exclua -o e tente novamente."
 .define res_string_prompt_delete_confirm_prefix "Tem certeza de que deseja excluir permanentemente "
 .define res_string_prompt_delete_confirm_suffix "?"
 .define res_string_label_delete_count "Excluindo: "
diff --git a/desktop/res/desktop.res.sv b/desktop/res/desktop.res.sv
index 5a9b00cd..f89db000 100644
--- a/desktop/res/desktop.res.sv
+++ b/desktop/res/desktop.res.sv
@@ -47,6 +47,7 @@
 .define res_string_prompt_overwrite "Den filen finns redan. Vill du byta ut den?"
 .define res_string_errmsg_too_large_to_copy "Den h{r filen {r f|r stor f|r att kopieras."
 .define res_string_errmsg_too_large_to_move "Den h{r filen {r f|r stor f|r att flyttas."
+.define res_string_errmsg_overwrite_dir "En mapp kan inte ers{ttas av ett annat objekt. Radera det sedan f|rs|k igen."
 .define res_string_prompt_delete_confirm_prefix "[r du s{ker p} att du vill ta bort "
 .define res_string_prompt_delete_confirm_suffix " permanent?"
 .define res_string_label_delete_count "Raderar: "
diff --git a/res/notes/testplan.md b/res/notes/testplan.md
index c3f5b6fc..395d168a 100644
--- a/res/notes/testplan.md
+++ b/res/notes/testplan.md
@@ -235,6 +235,10 @@
 * Load DeskTop. Create a folder, and a file within the folder with the same name as the folder (e.g. /RAM/F and /RAM/F/F). Try to move the file over the folder using drag and drop. Verify that an error is shown.
 * Load DeskTop. Create a folder, and a file within the folder with the same name as the folder, and another file (e.g. /RAM/F and /RAM/F/F and /RAM/F/B). Select both files and try to move them into the parent folder using drag and drop. Verify that an error is shown before any files are moved.
 
+* Load DeskTop. Create a folder on a volume. Create a non-folder file with the same name as the folder on a second volume. Drag the folder to the second volume. When prompted to overwrite, click Yes. Verify that the volume contains a folder of the appropriate name.
+* Load DeskTop. Create a folder on a volume, containing a non-folder file. Create a non-folder file with the same name as the folderon a second volume. Drag the folder to the second volume. When prompted to overwrite, click Yes. Verify that the volume contains a folder of the appropriate name, containing a non-folder file.
+* Load DeskTop. Create a non-folder file on a volume. Create a folder with the same name as the file on a second volume. Drag the file onto the second volume. Verify that an alert is shown about overwriting a directory.
+
 * Load DeskTop. Open a volume. Adjust the window size so that horizontal and vertical scrolling is required. Scroll to the bottom-right. Quit DeskTop, reload. Verify that the window size and scroll position was restored correctly.
 * Load DeskTop. Open a volume. Quit DeskTop, reload. Verify that the volume window was restored, and that the volume icon is dimmed. Close the volume window. Verify that the volume icon is no longer dimmed.
 * Load DeskTop. Open a window containing icons. View > by Name. Quit DeskTop, reload. Verify that the window is restored, and that it shows the icons in a list sorted by name, and that View > by Name is checked. Repeat for other View menu options.