--- a/packages/opencode/src/cli/cmd/tui/thread.ts
+++ b/packages/opencode/src/cli/cmd/tui/thread.ts
@@ -120,11 +120,14 @@ export const TuiThreadCommand = cmd({
         return
       }

-      // Resolve relative paths against PWD to preserve behavior when using --cwd flag
+      // Use PWD as the base for resolving relative --project paths so that
+      // symlink-aware shells see the right directory. For the no-project case,
+      // use the real OS cwd so that Instance.directory always matches the
+      // canonical path that git and other tools report.
       const root = Filesystem.resolve(process.env.PWD ?? process.cwd())
       const cwd = args.project
         ? Filesystem.resolve(path.isAbsolute(args.project) ? args.project : path.join(root, args.project))
-        : root
+        : Filesystem.resolve(process.cwd())
       const file = await target()
       try {
         process.chdir(cwd)