diff --git a/Cargo.lock b/Cargo.lock
index 74374912a7..3f514d5816 100644
--- a/Cargo.lock
+++ b/Cargo.lock
@@ -776,11 +776,12 @@ checksum = "3c877555693c14d2f84191cfd3ad8582790fc52b5e2274b40b59cf5f5cea25c7"
 
 [[package]]
 name = "dialoguer"
-version = "0.10.1"
+version = "0.10.4"
 source = "registry+https://github.com/rust-lang/crates.io-index"
-checksum = "d8c8ae48e400addc32a8710c8d62d55cb84249a7d58ac4cd959daecfbaddc545"
+checksum = "59c6f2989294b9a498d3ad5491a79c6deb604617378e1cdc4bfc1c1361fe2f87"
 dependencies = [
  "console",
+ "shell-words",
  "tempfile",
  "zeroize",
 ]
@@ -2596,6 +2597,12 @@ dependencies = [
  "opaque-debug 0.3.0",
 ]
 
+[[package]]
+name = "shell-words"
+version = "1.1.0"
+source = "registry+https://github.com/rust-lang/crates.io-index"
+checksum = "24188a676b6ae68c3b2cb3a01be17fbf7240ce009799bb56d5b1409051e78fde"
+
 [[package]]
 name = "shellexpand"
 version = "3.0.0"
diff --git a/zellij-server/src/pty.rs b/zellij-server/src/pty.rs
index ea2d4fe44c..fb58aef8bd 100644
--- a/zellij-server/src/pty.rs
+++ b/zellij-server/src/pty.rs
@@ -742,7 +742,7 @@ impl Pty {
             }
         });
         match run_instruction {
-            Some(Run::Command(command)) => {
+            Some(Run::Command(mut command)) => {
                 let starts_held = command.hold_on_start;
                 let hold_on_close = command.hold_on_close;
                 let quit_cb = Box::new({
@@ -762,6 +762,11 @@ impl Pty {
                         }
                     }
                 });
+                if command.cwd.is_none() {
+                    if let TerminalAction::RunCommand(cmd) = default_shell {
+                        command.cwd = cmd.cwd;
+                    }
+                }
                 let cmd = TerminalAction::RunCommand(command.clone());
                 if starts_held {
                     // we don't actually open a terminal in this case, just wait for the user to run it