diff --git a/crates/goose/src/config/base.rs b/crates/goose/src/config/base.rs
index 71086656a4eb..68ceff4179af 100644
--- a/crates/goose/src/config/base.rs
+++ b/crates/goose/src/config/base.rs
@@ -7,7 +7,7 @@ use serde_json::Value;
 use std::collections::HashMap;
 use std::env;
 use std::fs::OpenOptions;
-use std::io::Write;
+use std::io::{Read, Seek, SeekFrom, Write};
 use std::path::{Path, PathBuf};
 use thiserror::Error;
 
@@ -342,8 +342,15 @@ impl Config {
     /// - There is an error reading or writing the config file
     /// - There is an error serializing the value
     pub fn set_param(&self, key: &str, value: Value) -> Result<(), ConfigError> {
-        // Open the file with write permissions, create if it doesn't exist
+        // Ensure the directory exists
+        if let Some(parent) = self.config_path.parent() {
+            std::fs::create_dir_all(parent)
+                .map_err(|e| ConfigError::DirectoryError(e.to_string()))?;
+        }
+
+        // Open the file with read+write permissions, create if it doesn't exist
         let mut file = OpenOptions::new()
+            .read(true)
             .write(true)
             .create(true)
             .truncate(false)
@@ -353,17 +360,22 @@ impl Config {
         file.lock_exclusive()
             .map_err(|e| ConfigError::LockError(e.to_string()))?;
 
-        // Load current values while holding the lock
-        let mut values = if self.config_path.exists() {
-            let file_content = std::fs::read_to_string(&self.config_path)?;
-            let yaml_value: serde_yaml::Value = serde_yaml::from_str(&file_content)?;
-            let json_value: Value = serde_json::to_value(yaml_value)?;
-            match json_value {
-                Value::Object(map) => map.into_iter().collect(),
-                _ => HashMap::new(),
+        // Load current values while holding the lock - read through the file handle
+        let mut values = {
+            let mut file_content = String::new();
+            file.seek(SeekFrom::Start(0))?;
+            file.read_to_string(&mut file_content)?;
+
+            if file_content.trim().is_empty() {
+                HashMap::new()
+            } else {
+                let yaml_value: serde_yaml::Value = serde_yaml::from_str(&file_content)?;
+                let json_value: Value = serde_json::to_value(yaml_value)?;
+                match json_value {
+                    Value::Object(map) => map.into_iter().collect(),
+                    _ => HashMap::new(),
+                }
             }
-        } else {
-            HashMap::new()
         };
 
         // Modify values
@@ -373,6 +385,7 @@ impl Config {
         let yaml_value = serde_yaml::to_string(&values)?;
 
         // Write the contents using the same file handle
+        file.seek(SeekFrom::Start(0))?; // Seek to beginning before writing
         file.set_len(0)?; // Clear the file
         file.write_all(yaml_value.as_bytes())?;
         file.sync_all()?;