To get rounded corners on both the inside and outside, you have to draw them that way. So instead of going down to the edge of a hard corner, stop a bit before it drop a anchor and then go diagonally at about a 45 degree angle and place your next anchor and round it out to the shape you want it to be. It really doesn't like hard edge corners, there's a reason why, I just couldn't begin to explain it to you. Thanks oddball! Yes, I did try that trick but it doesn't work well to me. Here's a tutorial I found surfing the net . As you can see the Pen tool just goes straight down, and you can always round the corners as well. Do I have just to incrase the radius of the Round Corners tool?