diff --git a/crates/uv/src/commands/project/init.rs b/crates/uv/src/commands/project/init.rs
index 9b0641b66..b540238e2 100644
--- a/crates/uv/src/commands/project/init.rs
+++ b/crates/uv/src/commands/project/init.rs
@@ -116,15 +116,27 @@ pub(crate) async fn init(
             let name = match name {
                 Some(name) => name,
                 None => {
-                    let name = path
+                    let directory_name = path
                         .file_name()
                         .and_then(|path| path.to_str())
                         .context("Missing directory name")?;
 
                     // Pre-normalize the package name by removing any leading or trailing
                     // whitespace, and replacing any internal whitespace with hyphens.
-                    let name = name.trim().replace(' ', "-");
-                    PackageName::from_owned(name)?
+                    let candidate = directory_name.trim().replace(' ', "-");
+                    match PackageName::from_owned(candidate) {
+                        Ok(name) => name,
+                        Err(_) => {
+                            let directory_description = if explicit_path.is_some() {
+                                "target directory"
+                            } else {
+                                "current directory"
+                            };
+                            anyhow::bail!(
+                                "The {directory_description} (`{directory_name}`) is not a valid package name. Please provide a package name with `--name`."
+                            );
+                        }
+                    }
                 }
             };
 
diff --git a/crates/uv/tests/it/init.rs b/crates/uv/tests/it/init.rs
index 96a5557bc..921b27c4e 100644
--- a/crates/uv/tests/it/init.rs
+++ b/crates/uv/tests/it/init.rs
@@ -2659,10 +2659,32 @@ fn init_hidden() {
     ----- stdout -----
 
     ----- stderr -----
-    error: Not a valid package or extra name: ".foo". Names must start and end with a letter or digit and may only contain -, _, ., and alphanumeric characters.
+    error: The target directory (`.foo`) is not a valid package name. Please provide a package name with `--name`.
     "###);
 }
 
+#[test]
+fn init_non_ascii_directory() -> Result<()> {
+    let context = TestContext::new("3.12");
+
+    let directory = context.temp_dir.child("püthon");
+    directory.create_dir_all()?;
+
+    let mut command = context.init();
+    command.current_dir(directory.path());
+
+    uv_snapshot!(context.filters(), command, @r###"
+    success: false
+    exit_code: 2
+    ----- stdout -----
+
+    ----- stderr -----
+    error: The current directory (`püthon`) is not a valid package name. Please provide a package name with `--name`.
+    "###);
+
+    Ok(())
+}
+
 /// Run `uv init` with an invalid `pyproject.toml` in a parent directory.
 #[test]
 fn init_failure() -> Result<()> {