diff --git a/scripts/install-cli.sh b/scripts/install-cli.sh
index 0be3be12bf8e..2d7b0ef7784c 100755
--- a/scripts/install-cli.sh
+++ b/scripts/install-cli.sh
@@ -41,27 +41,27 @@ cleanup_tmpfiles() {
 }
 trap cleanup_tmpfiles EXIT
 
-resolve_openclaw_effective_home() {
-  local openclaw_home="${OPENCLAW_HOME:-}"
-  if [[ -z "$openclaw_home" ]]; then
-    echo "$HOME"
-    return 0
-  fi
-
-  case "$openclaw_home" in
-    \~)
-      echo "$HOME"
-      ;;
-    \~/*)
-      echo "${HOME}/${openclaw_home#~/}"
-      ;;
-    *)
-      echo "$openclaw_home"
-      ;;
+resolve_home_path() {
+  local input="$1"
+  case "$input" in
+    \~) echo "$HOME" ;;
+    \~/*) echo "${HOME}${input:1}" ;;
+    *) echo "$input" ;;
   esac
 }
 
-OPENCLAW_EFFECTIVE_HOME="$(resolve_openclaw_effective_home)"
+INSTALLER_CWD="$(pwd -P)"
+resolve_installer_path() {
+  local input
+  input="$(resolve_home_path "$1")"
+  case "$input" in
+    "") echo "" ;;
+    /*) echo "$input" ;;
+    *) echo "${INSTALLER_CWD}/${input}" ;;
+  esac
+}
+
+OPENCLAW_EFFECTIVE_HOME="$(resolve_home_path "${OPENCLAW_HOME:-$HOME}")"
 PREFIX="${OPENCLAW_PREFIX:-${HOME}/.openclaw}"
 OPENCLAW_VERSION="${OPENCLAW_VERSION:-latest}"
 REQUIRED_COMPATIBLE_VERSION=""
@@ -209,9 +209,6 @@ preflight_fresh_git_disk_space() {
   local available_kib
   local available_gib
 
-  if [[ "$repo_dir" != /* ]]; then
-    repo_dir="$(pwd)/$repo_dir"
-  fi
   if [[ -d "$repo_dir/.git" ]]; then
     return 0
   fi
@@ -1356,9 +1353,6 @@ install_openclaw_from_git() {
   if [[ -z "$repo_dir" ]]; then
     fail "Git install dir cannot be empty"
   fi
-  if [[ "$repo_dir" != /* ]]; then
-    repo_dir="$(pwd)/$repo_dir"
-  fi
   mkdir -p "$(dirname "$repo_dir")"
   repo_dir="$(cd "$(dirname "$repo_dir")" && pwd)/$(basename "$repo_dir")"
 
@@ -1515,6 +1509,8 @@ refresh_gateway_service_if_loaded() {
 
 main() {
   parse_args "$@"
+  PREFIX="$(resolve_installer_path "$PREFIX")"
+  GIT_DIR="$(resolve_installer_path "$GIT_DIR")"
 
   if [[ "${OPENCLAW_NO_ONBOARD:-0}" == "1" ]]; then
     RUN_ONBOARD=0
diff --git a/test/scripts/install-cli.test.ts b/test/scripts/install-cli.test.ts
index 62dff3ba5589..f7fdb994cb4f 100644
--- a/test/scripts/install-cli.test.ts
+++ b/test/scripts/install-cli.test.ts
@@ -509,6 +509,94 @@ describe("install-cli.sh", () => {
     expect(output).toContain(`git=${join(openclawHome, "openclaw")}`);
   });
 
+  it.each([
+    { input: "arguments", method: "npm" },
+    { input: "environment", method: "npm" },
+    { input: "literal tilde", method: "npm" },
+    { input: "arguments", method: "git" },
+    { input: "environment", method: "git" },
+    { input: "literal tilde", method: "git" },
+  ] as const)(
+    "keeps a generated $method launcher working after $input supplied paths change cwd",
+    ({ input, method }) => {
+      const tmp = mkdtempSync(join(tmpdir(), `openclaw-install-cli-relative-${method}-`));
+      const installRoot = join(tmp, "install-root");
+      const otherRoot = join(tmp, "other-root");
+      const home = join(tmp, "home");
+      const prefixInput = input === "literal tilde" ? "~/openclaw-local" : "openclaw-local";
+      const prefix = join(input === "literal tilde" ? home : installRoot, "openclaw-local");
+      const nodeDir = join(prefix, "tools", "node-v24.15.0");
+      const repoInput = input === "literal tilde" ? "~/openclaw-source" : "openclaw-source";
+      const repo = join(input === "literal tilde" ? home : installRoot, "openclaw-source");
+      mkdirSync(installRoot, { recursive: true });
+      mkdirSync(join(nodeDir, "bin"), { recursive: true });
+      mkdirSync(join(nodeDir, "lib", "node_modules", "openclaw", "dist"), { recursive: true });
+      mkdirSync(join(repo, ".git"), { recursive: true });
+      mkdirSync(join(repo, "dist"), { recursive: true });
+      mkdirSync(otherRoot, { recursive: true });
+      symlinkSync(process.execPath, join(nodeDir, "bin", "node"));
+      symlinkSync("node-v24.15.0", join(prefix, "tools", "node"));
+      writeFileSync(
+        join(nodeDir, "bin", "npm"),
+        '#!/bin/bash\nif [[ "$1" == "config" ]]; then printf "null\\n"; fi\n',
+      );
+      chmodSync(join(nodeDir, "bin", "npm"), 0o755);
+      for (const entry of [
+        join(nodeDir, "lib", "node_modules", "openclaw", "dist", "entry.js"),
+        join(repo, "dist", "entry.js"),
+      ]) {
+        writeFileSync(entry, 'console.log("fixture cli");\n');
+      }
+
+      try {
+        const args =
+          input !== "environment"
+            ? `--prefix ${JSON.stringify(prefixInput)}${
+                method === "git" ? ` --git-dir ${JSON.stringify(repoInput)}` : ""
+              }`
+            : "";
+        const result = runInstallCliShell(
+          [
+            "set -euo pipefail",
+            `cd ${JSON.stringify(installRoot)}`,
+            `source ${JSON.stringify(join(process.cwd(), SCRIPT_PATH))}`,
+            "install_node() { :; }",
+            "ensure_git() { :; }",
+            "refresh_gateway_service_if_loaded() { :; }",
+            ...(method === "git"
+              ? [
+                  "preflight_fresh_git_disk_space() { :; }",
+                  "ensure_pnpm() { :; }",
+                  "ensure_pnpm_binary_for_scripts() { :; }",
+                  "ensure_pnpm_git_prepare_allowlist() { :; }",
+                  "activate_repo_pnpm_version() { :; }",
+                  "cleanup_legacy_submodules() { :; }",
+                  "resolve_git_openclaw_ref() { printf 'main\\n'; }",
+                  "checkout_git_openclaw_ref() { :; }",
+                  "git_install_lockfile_flag() { printf '%s\\n' '--no-frozen-lockfile'; }",
+                  "run_pnpm() { :; }",
+                  "git() { return 0; }",
+                ]
+              : []),
+            `main --${method} ${args}`,
+            `cd ${JSON.stringify(otherRoot)}`,
+            `${JSON.stringify(join(prefix, "bin", "openclaw"))} --version`,
+          ].join("\n"),
+          {
+            HOME: home,
+            OPENCLAW_GIT_DIR: input === "environment" && method === "git" ? repoInput : undefined,
+            OPENCLAW_PREFIX: input === "environment" ? prefixInput : undefined,
+          },
+        );
+
+        expect(result.status, result.stderr || result.stdout).toBe(0);
+        expect(result.stdout.trim().split("\n").at(-1)).toBe("fixture cli");
+      } finally {
+        rmSync(tmp, { force: true, recursive: true });
+      }
+    },
+  );
+
   it("resolves requested git install versions to checkout refs", () => {
     const result = runInstallCliShell(`
       set -euo pipefail