The first time you start using Dropbox with Texpad, the app has to be linked with your Dropbox account. Simply scroll down on the Home navigation view and tap on 'Linked with Dropbox'

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If you have the official Dropbox app installed the following dialogue will appear

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Select Allow in the bottom right hand corner to authorise Texpad to access files in your Apps/Texpad folder,

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Note to pre-v1.6.2 users:

Since Texpad 1.6.2 we have migrated from the Dropbox's old Core API to their new Sync API. This was necessary to solve a number of bugs that have arisen since iOS7 and improve our Dropbox support. Unfortunately, Dropbox do not allow full Dropbox access to Apps using the new API, it requires all Applications to use their own App Folder. That is to say when you next boot Texpad it will create a folder named Texpad in the Apps folder, which can be found in the root of your Dropbox. You will need to move your files into that folder to continue using them with Texpad.