.htaccess for wordpress in separate folder

Rather than change .htaccess, move the index.php up to root, open it, and change:

require( dirname( __FILE__ ) . '/wp-blog-header.php' );

to:

require( dirname( __FILE__ ) . '/wp/wp-blog-header.php' );

In Settings, your WordPress address should be http://example.com/wp, and Site address should be http://example.com.

This process is outlined in the Codex page Giving WordPress Its Own Directory.

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