--- a/tests/run-tests
+++ b/tests/run-tests
@@ -64,7 +64,7 @@ HGTMP="${TMPDIR-/tmp}/hgtests.$RANDOM.$R
     exit 1
 }
 
-TESTDIR="$PWD"
+TESTDIR="`pwd`"
 export TESTDIR
 INST="$HGTMP/install"
 PYTHONDIR="$INST/lib/python"