diff --git a/src/Session.cpp b/src/Session.cpp
index c51dd3ad..3f1df8b3 100644
--- a/src/Session.cpp
+++ b/src/Session.cpp
@@ -213,7 +213,7 @@ void Session::setProgram(const QString& program)
 }
 void Session::setInitialWorkingDirectory(const QString& dir)
 {
-    _initialWorkingDir = ShellCommand::expand(dir);
+    _initialWorkingDir = KShell::tildeExpand(ShellCommand::expand(dir));
 }
 void Session::setArguments(const QStringList& arguments)
 {