Makefile has a feature called VPATH that is often used for cross
platform compilation or the creation of a different flavor.

Example:

$ cd py3k
$ mkdir debug
$ cd debug
$ ../configure --with-pydebug
$ make
...
gcc -pthread -c -fno-strict-aliasing -g -Wall -Wstrict-prototypes  -I.
-IInclude -I../Include   -DPy_BUILD_CORE -o Python/mysnprintf.o
../Python/mysnprintf.c
gcc -pthread -g -Wall -Wstrict-prototypes   Parser/acceler.o
Parser/grammar1.o Parser/listnode.o Parser/node.o Parser/parser.o
Parser/parsetok.o Parser/bitset.o Parser/metagrammar.o
Parser/firstsets.o Parser/grammar.o Parser/pgen.o Objects/obmalloc.o
Python/mysnprintf.o Parser/tokenizer_pgen.o Parser/printgrammar.o
Parser/pgenmain.o -lpthread -ldl  -lutil -o Parser/pgen
gcc: Parser/tokenizer_pgen.o: No such file or directory
gcc: Parser/printgrammar.o: No such file or directory
gcc: Parser/pgenmain.o: No such file or directory