diff --git a/state/project.go b/state/project.go
index 843e138e..51c32227 100644
--- a/state/project.go
+++ b/state/project.go
@@ -428,12 +428,38 @@ func VendorUniverse(ctx context.Context, p string) error {
 	}
 
 	log.Ctx(ctx).Debug().Str("mod", p).Msg("vendoring universe")
-	if err := stdlib.Vendor(ctx, p); err != nil {
+
+	// Vendor in a temporary directory
+	tmp, err := os.MkdirTemp(path.Join(p, "cue.mod", "pkg"), "vendor-*")
+	if err != nil {
+		return err
+	}
+	if err := stdlib.Vendor(ctx, tmp); err != nil {
 		// FIXME(samalba): disabled install remote stdlib temporarily
 		// if _, err := mod.Install(ctx, p, stdlib.ModuleName, ""); err != nil {
 		return err
 	}
 
+	// Semi-atomic swap of the vendor directory
+	// The following basically does:
+	// rm -rf cue.mod/pkg/MODULE.old
+	// mv cue.mod/pkg/MODULE cue.mod/pkg/MODULE.old
+	// mv VENDOR cue.mod/pkg/MODULE
+	// rm -rf cue.mod/pkg/MODULE.old
+	newStdlib := path.Join(p, stdlib.Path)
+	oldStdlib := newStdlib + ".old"
+	if err := os.RemoveAll(oldStdlib); err != nil && !errors.Is(err, os.ErrNotExist) {
+		return err
+	}
+	if err := os.Rename(newStdlib, oldStdlib); err != nil && !errors.Is(err, os.ErrNotExist) {
+		return err
+	}
+	defer os.RemoveAll(oldStdlib)
+
+	if err := os.Rename(tmp, newStdlib); err != nil {
+		return err
+	}
+
 	return nil
 }
 
diff --git a/stdlib/stdlib.go b/stdlib/stdlib.go
index f14bb2b3..54f4a1f8 100644
--- a/stdlib/stdlib.go
+++ b/stdlib/stdlib.go
@@ -20,12 +20,7 @@ var (
 	Path          = path.Join("cue.mod", "pkg", ModuleName)
 )
 
-func Vendor(ctx context.Context, mod string) error {
-	// Remove any existing copy of the universe
-	if err := os.RemoveAll(path.Join(mod, Path)); err != nil {
-		return err
-	}
-
+func Vendor(ctx context.Context, dest string) error {
 	// Write the current version
 	return fs.WalkDir(FS, ".", func(p string, entry fs.DirEntry, err error) error {
 		if err != nil {
@@ -45,7 +40,7 @@ func Vendor(ctx context.Context, mod string) error {
 			return fmt.Errorf("%s: %w", p, err)
 		}
 
-		overlayPath := path.Join(mod, Path, p)
+		overlayPath := path.Join(dest, p)
 
 		if err := os.MkdirAll(filepath.Dir(overlayPath), 0755); err != nil {
 			return err