diff --git a/crates/nu-cli/src/shell/filesystem_shell.rs b/crates/nu-cli/src/shell/filesystem_shell.rs
index 5d3a7980ac..9c39f13e36 100644
--- a/crates/nu-cli/src/shell/filesystem_shell.rs
+++ b/crates/nu-cli/src/shell/filesystem_shell.rs
@@ -14,7 +14,7 @@ use nu_parser::ExpandContext;
 use nu_protocol::{Primitive, ReturnSuccess, UntaggedValue};
 use rustyline::completion::FilenameCompleter;
 use rustyline::hint::{Hinter, HistoryHinter};
-use std::path::{Path, PathBuf};
+use std::path::{Component, Path, PathBuf};
 use std::sync::atomic::Ordering;
 use trash as SendToTrash;
 
@@ -78,6 +78,29 @@ impl FilesystemShell {
             hinter: HistoryHinter {},
         }
     }
+
+    fn canonicalize(&self, path: impl AsRef<Path>) -> std::io::Result<PathBuf> {
+        let path = if path.as_ref().is_relative() {
+            let components = path.as_ref().components();
+            let mut result = PathBuf::from(self.path());
+            for component in components {
+                match component {
+                    Component::CurDir => { /* ignore current dir */ }
+                    Component::ParentDir => {
+                        result.pop();
+                    }
+                    Component::Normal(normal) => result.push(normal),
+                    _ => {}
+                }
+            }
+
+            result
+        } else {
+            path.as_ref().into()
+        };
+
+        dunce::canonicalize(path)
+    }
 }
 
 impl Shell for FilesystemShell {
@@ -201,11 +224,10 @@ impl Shell for FilesystemShell {
             Some(v) => {
                 let target = v.as_path()?;
 
-                if PathBuf::from("-") == target {
+                if target == Path::new("-") {
                     PathBuf::from(&self.last_path)
                 } else {
-                    let path = PathBuf::from(self.path());
-                    let path = dunce::canonicalize(path.join(&target)).map_err(|_| {
+                    let path = self.canonicalize(target).map_err(|_| {
                         ShellError::labeled_error(
                             "Cannot change to directory",
                             "directory not found",
diff --git a/crates/nu-cli/tests/commands/cd.rs b/crates/nu-cli/tests/commands/cd.rs
index 24ac6eb2a4..e0fc4b0b67 100644
--- a/crates/nu-cli/tests/commands/cd.rs
+++ b/crates/nu-cli/tests/commands/cd.rs
@@ -85,6 +85,28 @@ fn filesystem_change_current_directory_to_parent_directory() {
     })
 }
 
+#[test]
+fn filesystem_change_current_directory_to_parent_directory_after_delete_cwd() {
+    Playground::setup("cd_test_5_1", |dirs, sandbox| {
+        sandbox.within("foo").mkdir("bar");
+
+        let actual = nu!(
+            cwd: dirs.test().join("foo/bar"),
+            r#"
+                rm {}/foo/bar 
+                echo ","
+                cd .. 
+                pwd | echo $it
+            "#,
+            dirs.test()
+        );
+
+        let actual = actual.split(',').nth(1).unwrap();
+
+        assert_eq!(PathBuf::from(actual), *dirs.test().join("foo"));
+    })
+}
+
 #[test]
 fn filesystem_change_to_home_directory() {
     Playground::setup("cd_test_6", |dirs, _| {