diff --git a/README.md b/README.md
index e6b4f7c..55c89d4 100644
--- a/README.md
+++ b/README.md
@@ -20,7 +20,7 @@ npx update-ts-references --help
     --check         Checks if updates would be necessary (without applying them)
     --help          Show help
     --createTsConfig  Create default TS configs for packages where the main entry in the package.json have a ts|tsx extension (Note: respects the --configName parameter)
-    -createPathMappings Create paths mappings under compilerOptions for a better IDE support. It respects the rootDir if no rootDir available it falls back to "src"
+    --createPathMappings Create paths mappings under compilerOptions for a better IDE support. It respects the rootDir if no rootDir available it falls back to "src"
     --cwd           Set working directory. Default: /Users/john-doe/projects/my-project
     --verbose       Show verbose output. Default: false
 
@@ -68,7 +68,7 @@ The output for the created file looks like the following
 ```
 
 ## using --createPathMappings
-will create path mappings under `compilerOptions` for a better IDE support. It respects the `rootDir` if no `rootDir` available it falls back to `src`
+will create path mappings under `compilerOptions` for a better IDE support. It assumes the source files are under `src`.
 
 ```json
 {
diff --git a/package.json b/package.json
index 3b4c78c..21f9607 100644
--- a/package.json
+++ b/package.json
@@ -1,6 +1,6 @@
 {
   "name": "update-ts-references",
-  "version": "3.1.0",
+  "version": "3.2.0",
   "description": "Updates TypeScript references automatically while using workspaces",
   "bin": "src/index.js",
   "scripts": {
diff --git a/src/update-ts-references.js b/src/update-ts-references.js
index da9c0fb..58fa022 100644
--- a/src/update-ts-references.js
+++ b/src/update-ts-references.js
@@ -161,17 +161,17 @@ const getReferencesFromDependencies = (
 const ensurePosixPathStyle = (reference) => ({
     ...reference,
     path: reference.path.split(path.sep).join(path.posix.sep),
-    folder: reference.folder.split(path.sep).join(path.posix.sep),
+    folder: reference.folder?.split(path.sep).join(path.posix.sep),
 });
 
 const updateTsConfig = (
     configName,
-    win32OrPosixReferences,
+    references,
+    paths,
     check,
     createPathMappings = false,
     {packageDir} = {packageDir: process.cwd()},
 ) => {
-    const references = (win32OrPosixReferences || []).map(ensurePosixPathStyle);
     const tsconfigFilePath = path.join(packageDir, configName);
 
     try {
@@ -195,12 +195,9 @@ const updateTsConfig = (
             if (check === false) {
 
                 const compilerOptions = config?.compilerOptions ?? {};
-                if (createPathMappings)
+                if (createPathMappings && paths && Object.keys(paths).length > 0)
                     assign(compilerOptions, {
-                        paths: references.reduce((paths, ref) => ({
-                            ...paths,
-                            [`${ref.name}`]: [`${ref.folder}/${config.compilerOptions?.rootDir ?? 'src'}`]
-                        }), {})
+                        paths
                     })
 
                 const newTsConfig = assign(config,
@@ -219,6 +216,13 @@ const updateTsConfig = (
     }
 };
 
+function getPathsFromReferences(references) {
+    return references.reduce((paths, ref) => ({
+        ...paths,
+        [`${ref.name}`]: [`${ref.folder}/src`]
+    }), {});
+}
+
 const execute = async ({
                            cwd, createTsConfig,
                            verbose,
@@ -286,8 +290,8 @@ const execute = async ({
         console.log('packagesMap', packagesMap);
     }
 
-    const rootReferences = [];
-
+    let rootReferences = [];
+    let rootPaths = [];
     packagesMap.forEach((packageEntry, packageName) => {
         const detectedConfig = detectTSConfig(packageEntry.packageDir, configName, packageEntry.hasTsEntry && createTsConfig, cwd)
 
@@ -297,19 +301,25 @@ const execute = async ({
                 path: path.join(path.relative(cwd, packageEntry.packageDir), detectedConfig !== TSCONFIG_JSON ? detectedConfig : ''),
                 folder: path.relative(cwd, packageEntry.packageDir),
             });
-            const references = getReferencesFromDependencies(
+            const references = (getReferencesFromDependencies(
                 configName,
                 packageEntry,
                 packageName,
                 packagesMap,
                 verbose
-            );
+            ) || []).map(ensurePosixPathStyle);
+
+            const paths = getPathsFromReferences(references)
+
             if (verbose) {
                 console.log(`references of ${packageName}`, references);
+                console.log(`paths of ${packageName}`, paths);
             }
+
             changesCount += updateTsConfig(
                 detectedConfig,
                 references,
+                paths,
                 check,
                 createPathMappings,
                 packageEntry
@@ -317,16 +327,26 @@ const execute = async ({
         } else {
             // eslint-disable-next-line no-console
             console.log(`NO ${configName === TSCONFIG_JSON ? configName : `${configName} nor ${TSCONFIG_JSON}`} for ${packageName}`);
+            rootPaths.push({
+                name: packageName,
+                path: path.relative(cwd, packageEntry.packageDir),
+                folder: path.relative(cwd, packageEntry.packageDir),
+            });
         }
     });
 
+    rootReferences = (rootReferences || []).map(ensurePosixPathStyle);
+    rootPaths = getPathsFromReferences((rootPaths || []).map(ensurePosixPathStyle))
+
     if (verbose) {
         console.log('rootReferences', rootReferences);
+        console.log('rootPaths', rootPaths);
     }
     changesCount += updateTsConfig(
         rootConfigName,
         rootReferences,
-        check, false, {packageDir: cwd}
+        rootPaths,
+        check, createPathMappings, {packageDir: cwd}
     );
 
     if (verbose) {
diff --git a/test-scenarios/ts-paths/utils/foos/foo-a/tsconfig.json b/test-scenarios/ts-paths/utils/foos/foo-a/tsconfig.json
index aa3d6e5..1dd8e13 100644
--- a/test-scenarios/ts-paths/utils/foos/foo-a/tsconfig.json
+++ b/test-scenarios/ts-paths/utils/foos/foo-a/tsconfig.json
@@ -1,6 +1,6 @@
 {
   "compilerOptions": {
     "outDir": "dist",
-    "rootDir": "src2"
+    "rootDir": "src"
   }
 }
diff --git a/test-scenarios/ts-paths/utils/foos/foo-c/package.json b/test-scenarios/ts-paths/utils/foos/foo-c/package.json
new file mode 100644
index 0000000..d751623
--- /dev/null
+++ b/test-scenarios/ts-paths/utils/foos/foo-c/package.json
@@ -0,0 +1,6 @@
+{
+  "name": "foo-c",
+  "version": "1.0.0",
+  "dependencies": {
+  }
+}
diff --git a/tests/update-ts-references.test.js b/tests/update-ts-references.test.js
index 39cfa0b..a16119f 100644
--- a/tests/update-ts-references.test.js
+++ b/tests/update-ts-references.test.js
@@ -237,6 +237,7 @@ test('create paths mappings ', async () => {
         {
             compilerOptions: {
                 composite: true,
+                paths: { "foo-c": ["utils/foos/foo-c/src"]   }
             },
             files: [],
             references: [
@@ -291,9 +292,9 @@ test('create paths mappings ', async () => {
         {
             compilerOptions: {
                 ...compilerOptions,
-                rootDir: "src2",
+                rootDir: "src",
                 paths: {
-                    "foo-b": ["../foo-b/src2"]
+                    "foo-b": ["../foo-b/src"]
                 },
             },
             references: [