diff --git a/dhall-check.cabal b/dhall-check.cabal
--- a/dhall-check.cabal
+++ b/dhall-check.cabal
@@ -1,5 +1,5 @@
 name: dhall-check
-version: 1.0.0.1
+version: 1.1.0.0
 cabal-version: >=1.10
 build-type: Simple
 license: BSD3
diff --git a/src/Main.hs b/src/Main.hs
--- a/src/Main.hs
+++ b/src/Main.hs
@@ -40,13 +40,17 @@
 -- >>> dhallTypeOf "file.entry.dh"
 -- DhallType "entry"
 dhallTypeOf :: FilePath -> DhallType
-dhallTypeOf = DhallType . tail . map toLower . takeExtension . dropExtension
+dhallTypeOf f =
+  case takeExtension . dropExtension $ f of
+    "" -> throw $ WithoutType f
+    (_:xs) -> DhallType . map toLower $ xs
 
 
 data CheckException
   = CouldntFindTypeDefs
   | ParseException FilePath ParseError
   | UnknownType FilePath DhallType
+  | WithoutType FilePath
   | TypeChecking FilePath (TypeError Src)
   deriving (Show)
 
@@ -59,6 +63,8 @@
     "While parsing " ++ f ++ ":" ++ displayException pe
   displayException (TypeChecking f te) =
     "While type checking " ++ f ++ ":" ++ displayException te
+  displayException (WithoutType f) =
+    "The file " ++ f ++ " seems to have no type associated with it."
 
 
 main :: IO ()
@@ -67,11 +73,8 @@
   printExceptions $ do
     typedefs <- allTypeDefs here
     dhallfiles <- allDhallFiles here
-    -- Check all files once
-    printExceptions $ do
-      checkAll typedefs dhallfiles
-      putStrLn "No errors."
-    -- and then watch for changes
+    forM_ dhallfiles $ printExceptions . checkFile typedefs
+    putStrLn "Watching for changes.."
     withManager $ \mgr -> do
       watchTree mgr here isDhallFile $ \event -> do
         case event of
@@ -97,7 +100,7 @@
         Left e -> putStrLn $ displayException (e :: CheckException)
         Right v -> pure v
 
-    isDhallFile f = (flip elem [".dhall", ".dh"] . takeExtension . eventPath) f
+    isDhallFile f = ((==".dh") . takeExtension . eventPath) f
                  && (not . (==) '.' . head . takeFileName . eventPath) f
 
 
@@ -137,7 +140,7 @@
 -- | Get all a list of all dhall files in the given directory using absolute paths.
 allDhallFiles :: FilePath -> IO [(FilePath, Expr Src X)]
 allDhallFiles dir = do
-  files <- allFiles dir [".dh", ".dhall"]
+  files <- allFiles dir [".dh"]
   forM files $ \f -> do
     sequence (f, loadFile f)
 
@@ -149,7 +152,9 @@
   content <- TLIO.readFile f
   case exprFromText delta content of
     Left e -> throwIO $ ParseException f e
-    Right e -> load e
+    Right e -> do
+      setCurrentDirectory (takeDirectory f)
+      load e
 
 
 -- | Typecheck a single file against one of the given types.
@@ -173,8 +178,3 @@
       case typeOf annot of
         Left err -> throwIO $ TypeChecking f err
         Right _ -> pure ()
-
-
--- | Perform 'checkFile' on every file in the Foldable.
-checkAll :: Foldable t => Map DhallType (Expr Src X) -> t (FilePath, Expr Src X) -> IO ()
-checkAll types = mapM_ (checkFile types)