diff --git a/.dockerignore b/.dockerignore
index d6e533a40..37294b214 100644
--- a/.dockerignore
+++ b/.dockerignore
@@ -1,3 +1,4 @@
 # ignore temporary files for docker build
+out/
 build/
 .docker-mill-out/
diff --git a/Dockerfile b/Dockerfile
index b8d138fb0..b3f189a9a 100644
--- a/Dockerfile
+++ b/Dockerfile
@@ -42,6 +42,6 @@ RUN git config --global --add safe.directory '*'
 # download dependencies
 #
 RUN --mount=type=bind,source=.,target=/work,readonly \
-    --mount=type=tmpfs,destination=/work/out,rw <<EOF
-make deps
+    --mount=type=tmpfs,destination=/tmp/.mill-out,rw <<EOF
+make deps MILL_OUTPUT_DIR=/tmp/.mill-out
 EOF
diff --git a/scripts/Makefile.docker b/scripts/Makefile.docker
index 89ec109e2..71cf6a165 100644
--- a/scripts/Makefile.docker
+++ b/scripts/Makefile.docker
@@ -48,7 +48,6 @@ __prep_proxy: .mill-jvm-opts
 
 # build docker image
 image: $(if $(HTTP_PROXY),__prep_proxy) init
-	@mkdir -p out $(MILL_OUTPUT_DIR)
 	@docker build -t $(XSDEV_IMAGE) \
 		$(if $(HTTP_PROXY),--build-arg  HTTP_PROXY=$(HTTP_PROXY) \
 				  --build-arg HTTPS_PROXY=$(HTTP_PROXY)) . \