diff --git a/chroot_version_hooks.d/50_add_chromite_link b/chroot_version_hooks.d/50_add_chromite_link
new file mode 100644
index 0000000000..38b0c5530e
--- /dev/null
+++ b/chroot_version_hooks.d/50_add_chromite_link
@@ -0,0 +1,13 @@
+# Copyright (c) 2012 The Chromium OS Authors. All rights reserved.
+# Use of this source code is governed by a BSD-style license that can be
+# found in the LICENSE file.
+python_path=$(python -c 'import sys;print sys.version[:3]')
+python_path="/usr/lib/python${python_path}/site-packages/chromite"
+if [ ! -L "${python_path}" ]; then
+  sudo rm -rf "${python_path}" \
+      "/home/${PORTAGE_USERNAME:-${SUDO_USER:-${USER}}}/.local/lib/python2.6/site-packages/chromite"
+  sudo mkdir -p "$(dirname "${python_path}")"
+  sudo ln -s "${CHROOT_TRUNK_DIR}"/chromite "${python_path}"
+fi
+
+exit 0
diff --git a/common.sh b/common.sh
index 7d05f2b953..aa4f050c2d 100644
--- a/common.sh
+++ b/common.sh
@@ -180,9 +180,7 @@ die_notrace() {
 # by the calling script.
 get_gclient_root_list() {
   if [ $INSIDE_CHROOT -eq 1 ]; then
-    echo "/home/${USER}/trunk"
-
-    if [ -n "${SUDO_USER}" ]; then echo "/home/${SUDO_USER}/trunk"; fi
+    echo "${CHROOT_TRUNK_DIR}"
   fi
 
   if [ -n "${COMMON_SH}" ]; then echo "$(dirname "$COMMON_SH")/../.."; fi
@@ -327,12 +325,64 @@ CHROMEOS_TEST_IMAGE_NAME="chromiumos_test_image.bin"
 CHROMEOS_FACTORY_TEST_IMAGE_NAME="chromiumos_factory_image.bin"
 CHROMEOS_FACTORY_INSTALL_SHIM_NAME="factory_install_shim.bin"
 
-# Directory locations inside the dev chroot
-if [ "${USER}" = "root" ]; then
-  CHROOT_TRUNK_DIR="/home/${SUDO_USER}/trunk"
-else
-  CHROOT_TRUNK_DIR="/home/${USER}/trunk"
-fi
+# Directory locations inside the dev chroot; try the new default,
+# falling back to user specific paths if the upgrade has yet to
+# happen.
+_user="${USER}"
+[ "${USER}" = "root" ] && _user="${SUDO_USER}"
+_CHROOT_TRUNK_DIRS=( "/home/${_user}/trunk" /mnt/host/source )
+_DEPOT_TOOLS_DIRS=( "/home/${_user}/depot_tools" /mnt/host/depot_tools )
+unset _user
+
+_process_mount_pt() {
+  # Given 4 arguments; the root path, the variable to set,
+  # the old location, and the new; finally, forcing the upgrade is doable
+  # via if a 5th arg is provided.
+  # This will then try to migrate the old to new if we can do so right now
+  # (else leaving symlinks in place w/in the new), and will set $1 to the
+  # new location.
+  local base="${1:-/}" var="${2}" old="${3}" new="${4}" force="${5:-false}"
+  local _sudo=$([ "$USER" != root ] && echo sudo)
+  local val="${new}"
+  if [ -L "${base}/${new}" ] || [ ! -e "${base}/${new}" ]; then
+    # Ok, it's either a symlink or this is the first run.  Upgrade if we can-
+    # specifically, if we're outside the chroot and we can rmdir the old.
+    # If we cannot rmdir the old, that's due to a mount being bound to that
+    # point (even if we can't see it, it's there)- thus fallback to adding
+    # compat links.
+    if ${force} || ( [ "$INSIDE_CHROOT" -eq 0 ] && \
+        ${_sudo} rmdir "${base}/${old}" 2> /dev/null ); then
+      ${_sudo} rm -f "${base}/${new}" || :
+      ${_sudo} mkdir -p "${base}/${new}" "$(dirname "${base}/${old}" )"
+      ${_sudo} ln -s "${new}" "${base}/${old}"
+    else
+      if [ ! -L "${base}/${new}" ]; then
+        # We can't do the upgrade right now; install compatibility links.
+        ${_sudo} mkdir -p "$(dirname "${base}/${new}")" "${base}/${old}"
+        ${_sudo} ln -s "${old}" "${base}/${new}"
+      fi
+      val="${old}"
+    fi
+  fi
+  eval "${var}=\"${val}\""
+}
+
+set_chroot_trunk_dir() {
+  # This takes two optional arguments; the first being the path to the chroot
+  # base; this is only used by enter_chroot.  The second argument is whether
+  # or not to force the new pathways; this is only used by make_chroot.  Passing
+  # a non-null value for $2 forces the new paths.
+  if [ "${INSIDE_CHROOT}" == 0 ] && [ -z "${1-}" ]; then
+    # Can't do the upgrade, thus skip trying to do so.
+    CHROOT_TRUNK_DIR="${_CHROOT_TRUNK_DIRS[1]}"
+    DEPOT_TOOLS_DIR="${_DEPOT_TOOLS_DIRS[1]}"
+    return
+  fi
+  _process_mount_pt "$1" CHROOT_TRUNK_DIR "${_CHROOT_TRUNK_DIRS[@]}" ${2:+true}
+  _process_mount_pt "$1" DEPOT_TOOLS_DIR "${_DEPOT_TOOLS_DIRS[@]}" ${2:+true}
+}
+
+set_chroot_trunk_dir
 
 # Install make for portage ebuilds.  Used by build_image and gmergefs.
 # TODO: Is /usr/local/autotest-chrome still used by anyone?
diff --git a/sdk_lib/enter_chroot.sh b/sdk_lib/enter_chroot.sh
index 23078ff401..a16da3ad3c 100755
--- a/sdk_lib/enter_chroot.sh
+++ b/sdk_lib/enter_chroot.sh
@@ -86,7 +86,6 @@ FILES_TO_COPY_TO_CHROOT=(
 
 INNER_CHROME_ROOT=$FLAGS_chrome_root_mount  # inside chroot
 CHROME_ROOT_CONFIG="/var/cache/chrome_root"  # inside chroot
-INNER_DEPOT_TOOLS_ROOT="/home/${SUDO_USER}/depot_tools"  # inside chroot
 FUSE_DEVICE="/dev/fuse"
 
 chmod 0777 "$FLAGS_chroot/var/lock"
@@ -94,6 +93,11 @@ chmod 0777 "$FLAGS_chroot/var/lock"
 LOCKFILE="$FLAGS_chroot/var/lock/enter_chroot"
 MOUNTED_PATH=$(readlink -f "$FLAGS_chroot")
 
+# Reset the depot tools/internal trunk pathways to what they'll
+# be w/in the chroot.
+set_chroot_trunk_dir "${FLAGS_chroot}"
+
+
 setup_mount() {
   # If necessary, mount $source in the host FS at $target inside the
   # chroot directory with $mount_args. We don't write to /etc/mtab because
@@ -213,6 +217,7 @@ setup_env() {
         setup_mount /run/shm "--bind" /run/shm
       fi
     fi
+
     setup_mount "${FLAGS_trunk}" "--bind" "${CHROOT_TRUNK_DIR}"
 
     debug "Setting up referenced repositories if required."
@@ -327,7 +332,7 @@ setup_env() {
     # A reference to the DEPOT_TOOLS path may be passed in by cros_sdk.
     if [ -n "${DEPOT_TOOLS}" ]; then
       debug "Mounting depot_tools"
-      setup_mount "${DEPOT_TOOLS}" --bind "${INNER_DEPOT_TOOLS_ROOT}"
+      setup_mount "${DEPOT_TOOLS}" --bind "${DEPOT_TOOLS_DIR}"
     fi
 
     # Mount additional directories as specified in .local_mounts file.
diff --git a/sdk_lib/make_chroot.sh b/sdk_lib/make_chroot.sh
index 258619c94f..265e4ddddc 100755
--- a/sdk_lib/make_chroot.sh
+++ b/sdk_lib/make_chroot.sh
@@ -85,7 +85,7 @@ fi
 # Support faster build if necessary.
 EMERGE_CMD="emerge"
 if [ "$FLAGS_fast" -eq "${FLAGS_TRUE}" ]; then
-  CHROOT_CHROMITE_DIR="/home/${SUDO_USER}/trunk/chromite"
+  CHROOT_CHROMITE_DIR="${CHROOT_TRUNK_DIR}/chromite"
   EMERGE_CMD="${CHROOT_CHROMITE_DIR}/bin/parallel_emerge"
 fi
 
@@ -163,11 +163,11 @@ init_setup () {
    mkdir -p -m 755 "${FLAGS_chroot}/usr" \
      "${FLAGS_chroot}/usr/local/portage" \
      "${FLAGS_chroot}"/"${CROSSDEV_OVERLAY}"
-   ln -sf "${CHROOT_TRUNK}/src/third_party/portage" \
+   ln -sf "${CHROOT_TRUNK_DIR}/src/third_party/portage" \
      "${FLAGS_chroot}/usr/portage"
-   ln -sf "${CHROOT_TRUNK}/src/third_party/chromiumos-overlay" \
+   ln -sf "${CHROOT_TRUNK_DIR}/src/third_party/chromiumos-overlay" \
      "${FLAGS_chroot}"/"${CHROOT_OVERLAY}"
-   ln -sf "${CHROOT_TRUNK}/src/third_party/portage-stable" \
+   ln -sf "${CHROOT_TRUNK_DIR}/src/third_party/portage-stable" \
      "${FLAGS_chroot}"/"${PORTAGE_STABLE_OVERLAY}"
 
    # Some operations need an mtab.
@@ -236,11 +236,15 @@ init_setup () {
    # We rely on 'env-update' getting called below.
    target="${FLAGS_chroot}/etc/env.d/99chromiumos"
    cat <<EOF > "${target}"
-PATH=/home/${SUDO_USER}/trunk/chromite/bin:/home/${SUDO_USER}/depot_tools
-CROS_WORKON_SRCROOT="${CHROOT_TRUNK}"
+PATH=${CHROOT_TRUNK_DIR}/chromite/bin:${DEPOT_TOOLS_DIR}
+CROS_WORKON_SRCROOT="${CHROOT_TRUNK_DIR}"
 PORTAGE_USERNAME=${SUDO_USER}
 EOF
 
+   # Add chromite into python path.
+   CHROOT_TRUNK_DIR="${CHROOT_TRUNK_DIR}" bash -e \
+       "${SCRIPT_ROOT}/chroot_version_hooks.d/50_add_chromite_pythonpath"
+
    # TODO(zbehan): Configure stuff that is usually configured in postinst's,
    # but wasn't. Fix the postinst's.
    info "Running post-inst configuration hacks"
@@ -278,12 +282,6 @@ en_US.UTF-8 UTF-8
 EOF
    fi
 
-   # Add chromite as a local site-package.
-   local site_packages="/home/${SUDO_USER}/.local/lib/python2.6/site-packages"
-   user_mkdir "${FLAGS_chroot}${site_packages}"
-   user_symlink ../../../../trunk/chromite \
-     "${FLAGS_chroot}${site_packages}/chromite"
-
    # Automatically change to scripts directory.
    echo 'cd ${CHROOT_CWD:-~/trunk/src/scripts}' \
        | user_append "$FLAGS_chroot/home/${SUDO_USER}/.bash_profile"
@@ -333,7 +331,7 @@ CHROOT_TRUNK="${CHROOT_TRUNK_DIR}"
 PORTAGE="${SRC_ROOT}/third_party/portage"
 OVERLAY="${SRC_ROOT}/third_party/chromiumos-overlay"
 CONFIG_DIR="${OVERLAY}/chromeos/config"
-CHROOT_CONFIG="${CHROOT_TRUNK}/src/third_party/chromiumos-overlay/chromeos/config"
+CHROOT_CONFIG="${CHROOT_TRUNK_DIR}/src/third_party/chromiumos-overlay/chromeos/config"
 PORTAGE_STABLE_OVERLAY="/usr/local/portage/stable"
 CROSSDEV_OVERLAY="/usr/local/portage/crossdev"
 CHROOT_OVERLAY="/usr/local/portage/chromiumos"
@@ -386,10 +384,15 @@ fi
 # Set up users, if needed, before mkdir/mounts below.
 [ -f $CHROOT_STATE ] || init_users
 
+# Reset internal vars to force them to the 'inside the chroot' value;
+# since user directories now exist, this can do the upgrade in place.
+set_chroot_trunk_dir "${FLAGS_chroot}" poppycock
+
 echo
 info "Setting up mounts..."
 # Set up necessary mounts and make sure we clean them up on exit.
-mkdir -p "${FLAGS_chroot}/${CHROOT_TRUNK}" "${FLAGS_chroot}/run"
+mkdir -p "${FLAGS_chroot}/${CHROOT_TRUNK_DIR}" \
+    "${FLAGS_chroot}/${DEPOT_TOOLS_DIR}" "${FLAGS_chroot}/run"
 
 # Create a special /etc/make.conf.host_setup that we use to bootstrap
 # the chroot.  The regular content for the file will be generated the
@@ -452,7 +455,7 @@ if [[ ${FLAGS_usepkg} -eq ${FLAGS_FALSE} ]]; then
   TOOLCHAIN_ARGS+=( --nousepkg )
 fi
 # Note: early_enter_chroot executes as root.
-early_enter_chroot "${CHROOT_TRUNK}/chromite/bin/cros_setup_toolchains" \
+early_enter_chroot "${CHROOT_TRUNK_DIR}/chromite/bin/cros_setup_toolchains" \
     --hostonly "${TOOLCHAIN_ARGS[@]}"
 
 # dhcpcd is included in 'world' by the stage3 that we pull in for some reason.
@@ -468,7 +471,7 @@ if [ -n "${INITIALIZE_CHROOT}" ]; then
   # If we're creating a new chroot, we also want to set it to the latest
   # version.
   enter_chroot \
-    "${CHROOT_TRUNK}/src/scripts/run_chroot_version_hooks" --force_latest
+    "${CHROOT_TRUNK_DIR}/src/scripts/run_chroot_version_hooks" --force_latest
 fi
 
 # Update chroot.
@@ -488,7 +491,7 @@ fi
 if [[ "${FLAGS_jobs}" -ne -1 ]]; then
   UPDATE_ARGS+=( --jobs=${FLAGS_jobs} )
 fi
-enter_chroot "${CHROOT_TRUNK}/src/scripts/update_chroot" "${UPDATE_ARGS[@]}"
+enter_chroot "${CHROOT_TRUNK_DIR}/src/scripts/update_chroot" "${UPDATE_ARGS[@]}"
 
 CHROOT_EXAMPLE_OPT=""
 if [[ "$FLAGS_chroot" != "$DEFAULT_CHROOT_DIR" ]]; then
@@ -497,7 +500,7 @@ fi
 
 # As a final pass, build all desired cross-toolchains.
 info "Updating toolchains"
-enter_chroot sudo -E "${CHROOT_TRUNK}/chromite/bin/cros_setup_toolchains" \
+enter_chroot sudo -E "${CHROOT_TRUNK_DIR}/chromite/bin/cros_setup_toolchains" \
     "${TOOLCHAIN_ARGS[@]}"
 
 command_completed