diff --git a/libs/freetdm/Makefile.am b/libs/freetdm/Makefile.am
index 964ae5c96e..a7d8f4a9ce 100644
--- a/libs/freetdm/Makefile.am
+++ b/libs/freetdm/Makefile.am
@@ -37,7 +37,7 @@ libdir = $(PREFIX)/lib/
 library_includedir = $(PREFIX)/include
 
 INCS      = -I$(OZ_SRCDIR)/$(SRC)/include -I$(OZ_SRCDIR)/$(SRC)/isdn/include -I$(OZ_SRCDIR)/$(SRC)/ozmod/ozmod_ss7_boost 
-MY_CFLAGS = $(INCS) $(ZAP_CFLAGS) -DZAP_CONFIG_DIR=\"@prefix@/conf\" -DZAP_MOD_DIR=\"$(moddir)\" @COMP_VENDOR_CFLAGS@ @DEFS@
+MY_CFLAGS = $(INCS) $(ZAP_CFLAGS) -DZAP_CONFIG_DIR=\"@confdir@\" -DZAP_MOD_DIR=\"$(moddir)\" @COMP_VENDOR_CFLAGS@ @DEFS@
 COMPILE   = $(CC) $(MY_CFLAGS) $(INCS)
 LTCOMPILE = $(LIBTOOL) --mode=compile --tag=CC $(COMPILE)
 LINK      = $(LIBTOOL) --mode=link --tag=CC $(CC) $(MY_CFLAGS) $(LDFLAGS) -o $@
@@ -231,6 +231,6 @@ mod_openzap-clean:
 
 install-data-local:
 	$(mkinstalldirs) $(DESTDIR)$(PREFIX)
-	$(mkinstalldirs) $(DESTDIR)$(PREFIX)/conf
-	@[ -f "$(DESTDIR)$(PREFIX)/conf/openzap.conf" ] || ( cp conf/*.conf $(DESTDIR)$(PREFIX)/conf)
+	$(mkinstalldirs) $(DESTDIR)@confdir@
+	@[ -f "$(DESTDIR)@confdir@/openzap.conf" ] || ( cp conf/*.conf $(DESTDIR)@confdir@)
 	@echo OpenZAP Installed
diff --git a/libs/freetdm/configure.ac b/libs/freetdm/configure.ac
index f7a0576809..e89564af7a 100644
--- a/libs/freetdm/configure.ac
+++ b/libs/freetdm/configure.ac
@@ -25,6 +25,14 @@ oz_builddir=`pwd`
 AC_SUBST(OZ_SRCDIR)
 AC_SUBST(oz_builddir)
 
+if test "$sysconfdir" = "\${prefix}/etc" ; then
+    confdir="$prefix/conf"
+else
+    confdir="$sysconfdir"
+fi
+
+AC_SUBST(confdir)
+
 #override some default libtool behavior and invoke AC_PROG_LIBTOOL (see http://lists.gnu.org/archive/html/libtool/2007-03/msg00000.html)
 m4_defun([_LT_AC_LANG_F77_CONFIG], [:])
 m4_defun([_LT_AC_LANG_GCJ_CONFIG], [:])