diff --git a/CHANGELOG.md b/CHANGELOG.md
index 61d1599498..b74a8cc93a 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -11,6 +11,8 @@
     * Now `pip install` uses `--no-cache` (\#1980).
 * API
     * Deprecate the `verbose` query parameter in `GET /api/v2/task/collect/{state_id}/` (\#1980).
+    * Add `project_dir` attribute to `UserSettings` (\#1990).
+    * Set a default for `DatasetV2.zarr_dir` (\#1990).
     * Combine the `args_schema_parallel` and `args_schema_non_parallel` query parameters in `GET /api/v2/task/` into a single parameter `args_schema` (\#1998).
 
 # 2.7.1
diff --git a/fractal_server/app/models/user_settings.py b/fractal_server/app/models/user_settings.py
index acff62a8ca..c779d94df6 100644
--- a/fractal_server/app/models/user_settings.py
+++ b/fractal_server/app/models/user_settings.py
@@ -36,3 +36,4 @@ class UserSettings(SQLModel, table=True):
     ssh_jobs_dir: Optional[str] = None
     slurm_user: Optional[str] = None
     cache_dir: Optional[str] = None
+    project_dir: Optional[str] = None
diff --git a/fractal_server/app/routes/api/v2/dataset.py b/fractal_server/app/routes/api/v2/dataset.py
index fb10699842..d47d69bd90 100644
--- a/fractal_server/app/routes/api/v2/dataset.py
+++ b/fractal_server/app/routes/api/v2/dataset.py
@@ -22,6 +22,8 @@
 from ._aux_functions import _get_submitted_jobs_statement
 from fractal_server.app.models import UserOAuth
 from fractal_server.app.routes.auth import current_active_user
+from fractal_server.string_tools import sanitize_string
+from fractal_server.urls import normalize_url
 
 router = APIRouter()
 
@@ -40,14 +42,45 @@ async def create_dataset(
     """
     Add new dataset to current project
     """
-    await _get_project_check_owner(
+    project = await _get_project_check_owner(
         project_id=project_id, user_id=user.id, db=db
     )
-    db_dataset = DatasetV2(project_id=project_id, **dataset.dict())
-    db.add(db_dataset)
-    await db.commit()
-    await db.refresh(db_dataset)
-    await db.close()
+
+    if dataset.zarr_dir is None:
+
+        if user.settings.project_dir is None:
+            raise HTTPException(
+                status_code=status.HTTP_422_UNPROCESSABLE_ENTITY,
+                detail=(
+                    "Both 'dataset.zarr_dir' and 'user.settings.project_dir' "
+                    "are null"
+                ),
+            )
+
+        db_dataset = DatasetV2(
+            project_id=project_id,
+            zarr_dir="__PLACEHOLDER__",
+            **dataset.dict(exclude={"zarr_dir"}),
+        )
+        db.add(db_dataset)
+        await db.commit()
+        await db.refresh(db_dataset)
+        path = (
+            f"{user.settings.project_dir}/fractal/"
+            f"{project_id}_{sanitize_string(project.name)}/"
+            f"{db_dataset.id}_{sanitize_string(db_dataset.name)}"
+        )
+        normalized_path = normalize_url(path)
+        db_dataset.zarr_dir = normalized_path
+
+        db.add(db_dataset)
+        await db.commit()
+        await db.refresh(db_dataset)
+    else:
+        db_dataset = DatasetV2(project_id=project_id, **dataset.dict())
+        db.add(db_dataset)
+        await db.commit()
+        await db.refresh(db_dataset)
 
     return db_dataset
 
diff --git a/fractal_server/app/schemas/user_settings.py b/fractal_server/app/schemas/user_settings.py
index edd3686bb2..0158cb7d1c 100644
--- a/fractal_server/app/schemas/user_settings.py
+++ b/fractal_server/app/schemas/user_settings.py
@@ -19,6 +19,10 @@
 
 
 class UserSettingsRead(BaseModel):
+    """
+    Schema reserved for superusers
+    """
+
     id: int
     ssh_host: Optional[str] = None
     ssh_username: Optional[str] = None
@@ -28,6 +32,7 @@ class UserSettingsRead(BaseModel):
     slurm_user: Optional[str] = None
     slurm_accounts: list[str]
     cache_dir: Optional[str] = None
+    project_dir: Optional[str] = None
 
 
 class UserSettingsReadStrict(BaseModel):
@@ -35,9 +40,14 @@ class UserSettingsReadStrict(BaseModel):
     slurm_accounts: list[str]
     cache_dir: Optional[str] = None
     ssh_username: Optional[str] = None
+    project_dir: Optional[str] = None
 
 
 class UserSettingsUpdate(BaseModel, extra=Extra.forbid):
+    """
+    Schema reserved for superusers
+    """
+
     ssh_host: Optional[str] = None
     ssh_username: Optional[str] = None
     ssh_private_key_path: Optional[str] = None
@@ -46,6 +56,7 @@ class UserSettingsUpdate(BaseModel, extra=Extra.forbid):
     slurm_user: Optional[str] = None
     slurm_accounts: Optional[list[StrictStr]] = None
     cache_dir: Optional[str] = None
+    project_dir: Optional[str] = None
 
     _ssh_host = validator("ssh_host", allow_reuse=True)(
         valstr("ssh_host", accept_none=True)
@@ -83,6 +94,13 @@ def cache_dir_validator(cls, value):
         validate_cmd(value)
         return val_absolute_path("cache_dir")(value)
 
+    @validator("project_dir")
+    def project_dir_validator(cls, value):
+        if value is None:
+            return None
+        validate_cmd(value)
+        return val_absolute_path("project_dir")(value)
+
 
 class UserSettingsUpdateStrict(BaseModel, extra=Extra.forbid):
     slurm_accounts: Optional[list[StrictStr]] = None
diff --git a/fractal_server/app/schemas/v2/dataset.py b/fractal_server/app/schemas/v2/dataset.py
index 3bb318446b..41678e8336 100644
--- a/fractal_server/app/schemas/v2/dataset.py
+++ b/fractal_server/app/schemas/v2/dataset.py
@@ -33,14 +33,16 @@ class DatasetCreateV2(BaseModel, extra=Extra.forbid):
 
     name: str
 
-    zarr_dir: str
+    zarr_dir: Optional[str] = None
 
     filters: Filters = Field(default_factory=Filters)
 
     # Validators
     @validator("zarr_dir")
     def normalize_zarr_dir(cls, v: str) -> str:
-        return normalize_url(v)
+        if v is not None:
+            return normalize_url(v)
+        return v
 
     _name = validator("name", allow_reuse=True)(valstr("name"))
 
@@ -95,7 +97,7 @@ class DatasetImportV2(BaseModel, extra=Extra.forbid):
 
     name: str
     zarr_dir: str
-    images: list[SingleImage] = Field(default_factory=[])
+    images: list[SingleImage] = Field(default_factory=list)
     filters: Filters = Field(default_factory=Filters)
 
     # Validators
diff --git a/fractal_server/migrations/versions/19eca0dd47a9_user_settings_project_dir.py b/fractal_server/migrations/versions/19eca0dd47a9_user_settings_project_dir.py
new file mode 100644
index 0000000000..652039a45f
--- /dev/null
+++ b/fractal_server/migrations/versions/19eca0dd47a9_user_settings_project_dir.py
@@ -0,0 +1,39 @@
+"""user settings project dir
+
+Revision ID: 19eca0dd47a9
+Revises: 8e8f227a3e36
+Create Date: 2024-10-30 14:34:28.219355
+
+"""
+import sqlalchemy as sa
+import sqlmodel
+from alembic import op
+
+
+# revision identifiers, used by Alembic.
+revision = "19eca0dd47a9"
+down_revision = "8e8f227a3e36"
+branch_labels = None
+depends_on = None
+
+
+def upgrade() -> None:
+    # ### commands auto generated by Alembic - please adjust! ###
+    with op.batch_alter_table("user_settings", schema=None) as batch_op:
+        batch_op.add_column(
+            sa.Column(
+                "project_dir",
+                sqlmodel.sql.sqltypes.AutoString(),
+                nullable=True,
+            )
+        )
+
+    # ### end Alembic commands ###
+
+
+def downgrade() -> None:
+    # ### commands auto generated by Alembic - please adjust! ###
+    with op.batch_alter_table("user_settings", schema=None) as batch_op:
+        batch_op.drop_column("project_dir")
+
+    # ### end Alembic commands ###
diff --git a/tests/no_version/test_api_user_groups.py b/tests/no_version/test_api_user_groups.py
index b891d2d43f..8a8fb864a7 100644
--- a/tests/no_version/test_api_user_groups.py
+++ b/tests/no_version/test_api_user_groups.py
@@ -331,6 +331,7 @@ async def test_patch_user_settings_bulk(
             slurm_user="test01",
             slurm_accounts=[],
             cache_dir=None,
+            project_dir=None,
         ) == user.settings.dict(exclude={"id"})
 
     # remove user4 from default user group
@@ -351,6 +352,7 @@ async def test_patch_user_settings_bulk(
         # missing `slurm_user`
         slurm_accounts=["foo", "bar"],
         cache_dir="/tmp/cache",
+        project_dir="/foo",
     )
     res = await registered_superuser_client.patch(
         f"{PREFIX}/group/{default_user_group.id}/user-settings/", json=patch
@@ -373,4 +375,28 @@ async def test_patch_user_settings_bulk(
         slurm_user="test01",
         slurm_accounts=[],
         cache_dir=None,
+        project_dir=None,
     ) == user4.settings.dict(exclude={"id"})
+
+    res = await registered_superuser_client.patch(
+        f"{PREFIX}/group/{default_user_group.id}/user-settings/",
+        json=dict(project_dir="not/an/absolute/path"),
+    )
+    assert res.status_code == 422
+
+    # `None` is a valid `project_dir`
+    res = await registered_superuser_client.patch(
+        f"{PREFIX}/group/{default_user_group.id}/user-settings/",
+        json=dict(project_dir="/fancy/dir"),
+    )
+    assert res.status_code == 200
+    for user in [user1, user2, user3]:
+        await db.refresh(user)
+        assert user.settings.project_dir == "/fancy/dir"
+    res = await registered_superuser_client.patch(
+        f"{PREFIX}/group/{default_user_group.id}/user-settings/",
+        json=dict(project_dir=None),
+    )
+    for user in [user1, user2, user3]:
+        await db.refresh(user)
+        assert user.settings.project_dir is None
diff --git a/tests/no_version/test_db.py b/tests/no_version/test_db.py
index 0382b832de..7262a9bb9d 100644
--- a/tests/no_version/test_db.py
+++ b/tests/no_version/test_db.py
@@ -1,5 +1,6 @@
 import pytest
 from devtools import debug
+from sqlmodel import delete
 from sqlmodel import select
 
 from fractal_server.app.db import DB
@@ -114,3 +115,55 @@ def test_DB_class_sync():
 
     assert DB._engine_sync
     assert DB._sync_session_maker
+
+
+async def test_reusing_id(db):
+    """
+    Tests different database behaviors with incremental IDs.
+
+    https://github.com/fractal-analytics-platform/fractal-server/issues/1991
+    """
+
+    num_users = 10
+
+    # Create `num_users` new users
+    user_list = [
+        UserOAuth(email=f"{x}@y.z", hashed_password="xxx")
+        for x in range(num_users)
+    ]
+
+    for user in user_list:
+        db.add(user)
+    await db.commit()
+    for user in user_list:
+        await db.refresh(user)
+
+    # Extract list of IDs
+    user_id_list = [user.id for user in user_list]
+
+    # Remove all users
+    await db.execute(delete(UserOAuth))
+    res = await db.execute(select(UserOAuth))
+    users = res.scalars().unique().all()
+    assert len(users) == 0
+
+    # Create `num_users + 10` new users
+    new_user_list = [
+        UserOAuth(email=f"{x}@y.z", hashed_password="xxx")
+        for x in range(num_users + 10)
+    ]
+    for user in new_user_list:
+        db.add(user)
+    await db.commit()
+    for user in new_user_list:
+        await db.refresh(user)
+
+    # Extract list of IDs
+    new_user_id_list = [user.id for user in new_user_list]
+
+    if DB_ENGINE == "sqlite":
+        # Assert IDs lists are overlapping
+        assert not set(new_user_id_list).isdisjoint(set(user_id_list))
+    else:
+        # Assert IDs lists are disjoined
+        assert set(new_user_id_list).isdisjoint(set(user_id_list))
diff --git a/tests/v2/01_schemas/test_schemas_dataset.py b/tests/v2/01_schemas/test_schemas_dataset.py
index 379ff5c378..87f32df041 100644
--- a/tests/v2/01_schemas/test_schemas_dataset.py
+++ b/tests/v2/01_schemas/test_schemas_dataset.py
@@ -27,6 +27,8 @@ async def test_schemas_dataset_v2():
         DatasetCreateV2(
             name="name", zarr_dir="/zarr", filters={"types": {"a": "b"}}
         )
+    # Test zarr_dir=None is valid
+    DatasetCreateV2(name="name", zarr_dir=None)
 
     dataset_create = DatasetCreateV2(
         name="name",
@@ -35,6 +37,9 @@ async def test_schemas_dataset_v2():
     )
     assert dataset_create.zarr_dir == normalize_url(dataset_create.zarr_dir)
 
+    with pytest.raises(ValidationError):
+        DatasetImportV2(name="name", zarr_dir=None)
+
     dataset_import = DatasetImportV2(
         name="name",
         filters={"attributes": {"x": 10}},
diff --git a/tests/v2/03_api/test_api_dataset.py b/tests/v2/03_api/test_api_dataset.py
index c49b418640..2e135391af 100644
--- a/tests/v2/03_api/test_api_dataset.py
+++ b/tests/v2/03_api/test_api_dataset.py
@@ -8,6 +8,8 @@
 )
 from fractal_server.app.schemas.v2 import JobStatusTypeV2
 from fractal_server.images import SingleImage
+from fractal_server.string_tools import sanitize_string
+from fractal_server.urls import normalize_url
 
 PREFIX = "api/v2"
 
@@ -194,33 +196,26 @@ async def test_get_user_datasets(
             assert len(ds["history"]) == 0
 
 
-async def test_post_dataset(client, MockCurrentUser):
-    async with MockCurrentUser():
-        # CREATE A PROJECT
-        res = await client.post(
-            f"{PREFIX}/project/",
-            json=dict(name="test project"),
-        )
-        assert res.status_code == 201
-        project = res.json()
-        project_id = project["id"]
+async def test_post_dataset(client, MockCurrentUser, project_factory_v2):
+    async with MockCurrentUser() as user:
+        prj = await project_factory_v2(user)
 
         # ADD DATASET
         payload = dict(name="new dataset", zarr_dir="/tmp/zarr")
         res = await client.post(
-            f"{PREFIX}/project/{project_id}/dataset/",
+            f"{PREFIX}/project/{prj.id}/dataset/",
             json=payload,
         )
         debug(res.json())
         assert res.status_code == 201
         dataset = res.json()
         assert dataset["name"] == payload["name"]
-        assert dataset["project_id"] == project_id
+        assert dataset["project_id"] == prj.id
 
         # EDIT DATASET
         payload1 = dict(name="new dataset name")
         res = await client.patch(
-            f"{PREFIX}/project/{project_id}/dataset/{dataset['id']}/",
+            f"{PREFIX}/project/{prj.id}/dataset/{dataset['id']}/",
             json=payload1,
         )
         patched_dataset = res.json()
@@ -229,6 +224,28 @@ async def test_post_dataset(client, MockCurrentUser):
         for k, v in payload1.items():
             assert patched_dataset[k] == v
 
+    # Test POST dataset without zarr_dir
+    async with MockCurrentUser(
+        user_settings_dict={"project_dir": "/some/dir"}
+    ) as user:
+        prj = await project_factory_v2(user)
+        res = await client.post(
+            f"{PREFIX}/project/{prj.id}/dataset/", json=dict(name="DSName")
+        )
+        assert res.json()["zarr_dir"] == normalize_url(
+            f"{user.settings.project_dir}/fractal/"
+            f"{prj.id}_{sanitize_string(prj.name)}/"
+            f"{res.json()['id']}_{sanitize_string(res.json()['name'])}"
+        )
+        assert res.status_code == 201
+
+    async with MockCurrentUser() as user:
+        prj = await project_factory_v2(user)
+        res = await client.post(
+            f"{PREFIX}/project/{prj.id}/dataset/", json=dict(name="DSName2")
+        )
+        assert res.status_code == 422
+
 
 async def test_delete_dataset(
     client, MockCurrentUser, project_factory_v2, dataset_factory_v2