diff --git a/tools/tsp-client/CHANGELOG.md b/tools/tsp-client/CHANGELOG.md
index 3ef73ac6028..c2ff5ea6274 100644
--- a/tools/tsp-client/CHANGELOG.md
+++ b/tools/tsp-client/CHANGELOG.md
@@ -1,5 +1,9 @@
 # Release
 
+## 2024-06-07 - 0.8.1
+
+- Normalize and clean up the directory property in tsp-location.yaml.
+
 ## 2024-05-29 - 0.8.0
 
 - Create unique directories for sparse spec checkout.
diff --git a/tools/tsp-client/package-lock.json b/tools/tsp-client/package-lock.json
index d89d76321a1..c8d1ed0d3fc 100644
--- a/tools/tsp-client/package-lock.json
+++ b/tools/tsp-client/package-lock.json
@@ -1,12 +1,12 @@
 {
   "name": "@azure-tools/typespec-client-generator-cli",
-  "version": "0.8.0",
+  "version": "0.8.1",
   "lockfileVersion": 3,
   "requires": true,
   "packages": {
     "": {
       "name": "@azure-tools/typespec-client-generator-cli",
-      "version": "0.8.0",
+      "version": "0.8.1",
       "license": "MIT",
       "dependencies": {
         "@azure/core-rest-pipeline": "^1.12.0",
diff --git a/tools/tsp-client/package.json b/tools/tsp-client/package.json
index ea28d42a856..88bde429c99 100644
--- a/tools/tsp-client/package.json
+++ b/tools/tsp-client/package.json
@@ -1,6 +1,6 @@
 {
   "name": "@azure-tools/typespec-client-generator-cli",
-  "version": "0.8.0",
+  "version": "0.8.1",
   "description": "A tool to generate Azure SDKs from TypeSpec",
   "main": "dist/index.js",
   "homepage": "https://github.com/Azure/azure-sdk-tools/tree/main/tools/tsp-client#readme",
diff --git a/tools/tsp-client/src/fs.ts b/tools/tsp-client/src/fs.ts
index 9863b112646..bddd6893048 100644
--- a/tools/tsp-client/src/fs.ts
+++ b/tools/tsp-client/src/fs.ts
@@ -2,7 +2,7 @@ import { mkdir, rm, stat, readFile, access } from "node:fs/promises";
 import { Logger } from "./log.js";
 import { parse as parseYaml } from "yaml";
 import { TspLocation } from "./typespec.js";
-import { joinPaths, resolvePath } from "@typespec/compiler";
+import { joinPaths, normalizePath, resolvePath } from "@typespec/compiler";
 
 export async function ensureDirectory(path: string) {
   await mkdir(path, { recursive: true });
@@ -32,6 +32,11 @@ export async function readTspLocation(rootDir: string): Promise<TspLocation> {
       if (!tspLocation.additionalDirectories) {
         tspLocation.additionalDirectories = [];
       }
+
+      // Normalize the directory path and remove trailing slash
+      tspLocation.directory = normalizeDirectory(tspLocation.directory);
+      tspLocation.additionalDirectories = tspLocation.additionalDirectories.map(normalizeDirectory);
+
       return tspLocation;
     }
     throw new Error("Could not find tsp-location.yaml");
@@ -59,3 +64,8 @@ export async function getEmitterFromRepoConfig(emitterPath: string): Promise<str
   }
   throw new Error("Could not find emitter package");
 }
+
+export function normalizeDirectory(directory: string): string {
+    const normalizedDir = normalizePath(directory);
+    return normalizedDir.endsWith("/") ? normalizedDir.slice(0, -1) : normalizedDir;
+}
diff --git a/tools/tsp-client/test/examples/sdk/badtsplocation/tsp-location.yaml b/tools/tsp-client/test/examples/sdk/badtsplocation/tsp-location.yaml
new file mode 100644
index 00000000000..945cffb4acf
--- /dev/null
+++ b/tools/tsp-client/test/examples/sdk/badtsplocation/tsp-location.yaml
@@ -0,0 +1,6 @@
+directory: specification\contosowidgetmanager\Contoso.WidgetManager\
+commit: 9df71d5a717e4ed5e6728e7e6ba2fead60f62243
+repo: Azure\azure-rest-api-specs
+additionalDirectories:
+- specification\contosowidgetmanager\Contoso.WidgetManager.Shared\
+- specification/contosowidgetmanager/Contoso.WidgetManager.Utils/
diff --git a/tools/tsp-client/test/tspLocation.spec.ts b/tools/tsp-client/test/tspLocation.spec.ts
new file mode 100644
index 00000000000..a9f0c014457
--- /dev/null
+++ b/tools/tsp-client/test/tspLocation.spec.ts
@@ -0,0 +1,17 @@
+import { assert } from "chai";
+import { normalizeDirectory, readTspLocation } from "../src/fs.js";
+import { describe, it } from "node:test";
+
+describe("Parse tsp-location.yaml", function () {
+  it("Normalize tsp-location.yaml directories", async function () {
+    const tspLocation = await readTspLocation("./test/examples/sdk/badtsplocation");
+    const directory = normalizeDirectory(tspLocation.directory);
+    assert.equal(directory, "specification/contosowidgetmanager/Contoso.WidgetManager");
+    const additionalDirectories = tspLocation.additionalDirectories?.map(normalizeDirectory);
+    assert.equal(additionalDirectories?.length, 2);
+    if (additionalDirectories) {
+        assert.equal(additionalDirectories[0], "specification/contosowidgetmanager/Contoso.WidgetManager.Shared");
+        assert.equal(additionalDirectories[1], "specification/contosowidgetmanager/Contoso.WidgetManager.Utils");
+    }
+  });
+});