diff --git a/lib/Cake/Test/Case/Utility/FolderTest.php b/lib/Cake/Test/Case/Utility/FolderTest.php
index fe1728da539..91c70e1ff91 100644
--- a/lib/Cake/Test/Case/Utility/FolderTest.php
+++ b/lib/Cake/Test/Case/Utility/FolderTest.php
@@ -170,6 +170,22 @@ public function testCreateWithTrailingDs() {
 		$this->assertTrue($Folder->delete());
 	}
 
+/**
+ * Test that relative paths to create() are added to cwd.
+ *
+ * @return void
+ */
+	public function testCreateRelative() {
+		$folder = new Folder(TMP);
+		$path = TMP . 'tests' . DS . 'relative-test';
+		$result = $folder->create('tests' . DS . 'relative-test');
+		$this->assertTrue($result, 'should create');
+
+		$this->assertTrue(is_dir($path), 'Folder was not made');
+		$folder = new Folder($path);
+		$folder->delete();
+	}
+
 /**
  * test recursive directory create failure.
  *
diff --git a/lib/Cake/Utility/Folder.php b/lib/Cake/Utility/Folder.php
index f84f0a39a01..a818c4817fb 100644
--- a/lib/Cake/Utility/Folder.php
+++ b/lib/Cake/Utility/Folder.php
@@ -487,10 +487,13 @@ public function tree($path = null, $exceptions = false, $type = null) {
 	}
 
 /**
- * Create a directory structure recursively. Can be used to create
- * deep path structures like `/foo/bar/baz/shoe/horn`
+ * Create a directory structure recursively.
  *
- * @param string $pathname The directory structure to create
+ * Can be used to create deep path structures like `/foo/bar/baz/shoe/horn`
+ *
+ * @param string $pathname The directory structure to create. Either an absolute or relative
+ *   path. If the path is relative and exists in the process' cwd it will not be created.
+ *   Otherwise relative paths will be prefixed with the current pwd().
  * @param int $mode octal value 0755
  * @return bool Returns TRUE on success, FALSE on failure
  * @link http://book.cakephp.org/2.0/en/core-utility-libraries/file-folder.html#Folder::create
@@ -500,6 +503,10 @@ public function create($pathname, $mode = false) {
 			return true;
 		}
 
+		if (!self::isAbsolute($pathname)) {
+			$pathname = self::addPathElement($this->pwd(), $pathname);
+		}
+
 		if (!$mode) {
 			$mode = $this->mode;
 		}