diff --git a/src/pytest_postgresql/executor.py b/src/pytest_postgresql/executor.py
index 72dfaaee..9350ecc3 100644
--- a/src/pytest_postgresql/executor.py
+++ b/src/pytest_postgresql/executor.py
@@ -135,25 +135,23 @@ def init_directory(self):
             return
         # remove old one if exists first.
         self.clean_directory()
-        init_directory = [self.executable, 'initdb', '--pgdata', self.datadir]
-        options = ['--username=%s' % self.user]
+        init_directory = [
+            self.executable, 'initdb', f'-o "--auth=trust --username={self.user}"',
+            f'-D {self.datadir}'
+        ]
 
         if self.password:
+            password = self.password if isinstance(self.password, bytes) else self.password.encode()
             with tempfile.NamedTemporaryFile() as password_file:
-                options += ['--auth=password',
-                            '--pwfile=%s' % password_file.name]
-                if hasattr(self.password, 'encode'):
-                    password = self.password.encode('utf-8')
-                else:
-                    password = self.password
+                init_directory += [
+                    f'-o "--pwfile={password_file.name}"',
+                ]
                 password_file.write(password)
+                # Without flush(), PostgreSQL will se password file as empty
                 password_file.flush()
-                init_directory += ['-o', ' '.join(options)]
-                subprocess.check_output(init_directory)
+                subprocess.check_output(' '.join(init_directory), shell=True)
         else:
-            options += ['--auth=trust']
-            init_directory += ['-o', ' '.join(options)]
-            subprocess.check_output(init_directory)
+            subprocess.check_output(' '.join(init_directory), shell=True)
 
         self._directory_initialised = True
 
diff --git a/tests/conftest.py b/tests/conftest.py
index 5670a6a2..9d883b32 100644
--- a/tests/conftest.py
+++ b/tests/conftest.py
@@ -18,4 +18,6 @@
 
 postgresql_rand_proc = factories.postgresql_proc(port=None)
 postgresql_rand = factories.postgresql('postgresql_rand_proc')
+postgresql_password_proc = factories.postgresql_proc(password='test')
+postgresql_password = factories.postgresql('postgresql_password_proc')
 # pylint:enable=invalid-name
diff --git a/tests/test_postgresql.py b/tests/test_postgresql.py
index 83f33b8f..100d3582 100644
--- a/tests/test_postgresql.py
+++ b/tests/test_postgresql.py
@@ -50,6 +50,11 @@ def test_rand_postgres_port(postgresql_rand):
     assert postgresql_rand.status == psycopg2.extensions.STATUS_READY
 
 
+def test_postgres_password(postgresql_password):
+    """Check if postgres fixture can be started on random port."""
+    assert postgresql_password.status == psycopg2.extensions.STATUS_READY
+
+
 @pytest.mark.parametrize('_', range(2))
 def test_postgres_terminate_connection(
         postgresql, _):