import os
import sys
import shutil

tmp_dir = '.tmp'

# find out the name of the file to compile
tex_file = sys.argv[-1]
file_name, file_ext = os.path.splitext(tex_file)
assert file_ext[1:] == 'tex'

# create the temporary directory if it doesn't exist
if not os.path.isdir(tmp_dir):
  try:
    os.mkdir(tmp_dir)
  except OSError:
    raise IOError('A file named "%s" already exists in this catalog' % tmp_dir)

# run pdflatex
os.system('pdflatex --shell-escape --output-directory=%s %s' % (tmp_dir, file_name))

# move the pdf file back to the tex directory
try:
  shutil.move('%s%s%s.pdf' % (tmp_dir, os.path.sep, file_name), os.curdir)
except IOError:
  print '\n\nPdf file not found.'

Nice improvement. Is there a way to make it show up in the Typset in TeXShop and not only in drop-down menu within the .tex file's window?