diff --git a/CMakeLists.txt b/CMakeLists.txt
index 066d4c52ba..84975770fb 100644
--- a/CMakeLists.txt
+++ b/CMakeLists.txt
@@ -197,7 +197,7 @@ endif ()
 if(${BUILD_KUZU})
 add_definitions(-DKUZU_ROOT_DIRECTORY="${PROJECT_SOURCE_DIR}")
 add_definitions(-DKUZU_CMAKE_VERSION="${CMAKE_PROJECT_VERSION}")
-add_definitions(-DKUZU_EXTENSION_VERSION="0.2.3")
+add_definitions(-DKUZU_EXTENSION_VERSION="0.2.4")
 
 include_directories(src/include)
 include_directories(third_party/antlr4_cypher/include)
diff --git a/src/common/file_system/file_system.cpp b/src/common/file_system/file_system.cpp
index bc595b94d8..989ea54c73 100644
--- a/src/common/file_system/file_system.cpp
+++ b/src/common/file_system/file_system.cpp
@@ -23,6 +23,11 @@ bool FileSystem::fileOrPathExists(const std::string& /*path*/) const {
     KU_UNREACHABLE;
 }
 
+std::string FileSystem::expandPath(
+    main::ClientContext* /*context*/, const std::string& path) const {
+    return path;
+}
+
 std::string FileSystem::joinPath(const std::string& base, const std::string& part) {
     return (std::filesystem::path{base} / part).string();
 }
diff --git a/src/common/file_system/local_file_system.cpp b/src/common/file_system/local_file_system.cpp
index 71ff32ff9a..61bf453ac5 100644
--- a/src/common/file_system/local_file_system.cpp
+++ b/src/common/file_system/local_file_system.cpp
@@ -41,12 +41,7 @@ LocalFileInfo::~LocalFileInfo() {
 
 std::unique_ptr<FileInfo> LocalFileSystem::openFile(
     const std::string& path, int flags, main::ClientContext* context, FileLockType lock_type) {
-    auto fullPath = path;
-    if (path.starts_with('~')) {
-        fullPath =
-            context->getCurrentSetting(main::HomeDirectorySetting::name).getValue<std::string>() +
-            fullPath.substr(1);
-    }
+    auto fullPath = expandPath(context, path);
 #if defined(_WIN32)
     auto dwDesiredAccess = 0ul;
     auto dwCreationDisposition = (flags & O_CREAT) ? OPEN_ALWAYS : OPEN_EXISTING;
@@ -194,6 +189,17 @@ bool LocalFileSystem::fileOrPathExists(const std::string& path) const {
     return std::filesystem::exists(path);
 }
 
+std::string LocalFileSystem::expandPath(
+    main::ClientContext* context, const std::string& path) const {
+    auto fullPath = path;
+    if (path.starts_with('~')) {
+        fullPath =
+            context->getCurrentSetting(main::HomeDirectorySetting::name).getValue<std::string>() +
+            fullPath.substr(1);
+    }
+    return fullPath;
+}
+
 void LocalFileSystem::readFromFile(
     FileInfo* fileInfo, void* buffer, uint64_t numBytes, uint64_t position) const {
     auto localFileInfo = ku_dynamic_cast<FileInfo*, LocalFileInfo*>(fileInfo);
diff --git a/src/common/file_system/virtual_file_system.cpp b/src/common/file_system/virtual_file_system.cpp
index d54bbc7cf4..bc461a3943 100644
--- a/src/common/file_system/virtual_file_system.cpp
+++ b/src/common/file_system/virtual_file_system.cpp
@@ -41,6 +41,11 @@ bool VirtualFileSystem::fileOrPathExists(const std::string& path) const {
     return findFileSystem(path)->fileOrPathExists(path);
 }
 
+std::string VirtualFileSystem::expandPath(
+    main::ClientContext* context, const std::string& path) const {
+    return findFileSystem(path)->expandPath(context, path);
+}
+
 void VirtualFileSystem::readFromFile(
     FileInfo* /*fileInfo*/, void* /*buffer*/, uint64_t /*numBytes*/, uint64_t /*position*/) const {
     KU_UNREACHABLE;
diff --git a/src/include/common/file_system/file_system.h b/src/include/common/file_system/file_system.h
index 8e7860a134..0562f4e9b0 100644
--- a/src/include/common/file_system/file_system.h
+++ b/src/include/common/file_system/file_system.h
@@ -37,6 +37,8 @@ class KUZU_API FileSystem {
 
     virtual bool fileOrPathExists(const std::string& path) const;
 
+    virtual std::string expandPath(main::ClientContext* context, const std::string& path) const;
+
     static std::string joinPath(const std::string& base, const std::string& part);
 
     static std::string getFileExtension(const std::filesystem::path& path);
diff --git a/src/include/common/file_system/local_file_system.h b/src/include/common/file_system/local_file_system.h
index c29f7b577d..60db562802 100644
--- a/src/include/common/file_system/local_file_system.h
+++ b/src/include/common/file_system/local_file_system.h
@@ -44,6 +44,8 @@ class LocalFileSystem final : public FileSystem {
 
     bool fileOrPathExists(const std::string& path) const override;
 
+    std::string expandPath(main::ClientContext* context, const std::string& path) const override;
+
 protected:
     void readFromFile(
         FileInfo* fileInfo, void* buffer, uint64_t numBytes, uint64_t position) const override;
diff --git a/src/include/common/file_system/virtual_file_system.h b/src/include/common/file_system/virtual_file_system.h
index 851380e6e7..2cc61a928f 100644
--- a/src/include/common/file_system/virtual_file_system.h
+++ b/src/include/common/file_system/virtual_file_system.h
@@ -30,6 +30,8 @@ class VirtualFileSystem final : public FileSystem {
 
     bool fileOrPathExists(const std::string& path) const override;
 
+    std::string expandPath(main::ClientContext* context, const std::string& path) const override;
+
 protected:
     void readFromFile(
         FileInfo* fileInfo, void* buffer, uint64_t numBytes, uint64_t position) const override;
diff --git a/src/main/database.cpp b/src/main/database.cpp
index 931065f11e..7a34406fa3 100644
--- a/src/main/database.cpp
+++ b/src/main/database.cpp
@@ -1,5 +1,6 @@
 #include "main/database.h"
 
+#include "common/random_engine.h"
 #include "main/database_manager.h"
 
 #if defined(_WIN32)
@@ -72,10 +73,15 @@ static void getLockFileFlagsAndType(bool readOnly, bool createNew, int& flags, F
 }
 
 Database::Database(std::string_view databasePath, SystemConfig systemConfig)
-    : databasePath{databasePath}, systemConfig{systemConfig} {
+    : systemConfig{systemConfig} {
     initLoggers();
     logger = LoggerUtils::getLogger(LoggerConstants::LoggerEnum::DATABASE);
     vfs = std::make_unique<VirtualFileSystem>();
+    // To expand a path with home directory(~), we have to pass in a dummy clientContext which
+    // handles the home directory expansion.
+    auto clientContext = ClientContext(this);
+    auto dbPathStr = std::string(databasePath);
+    this->databasePath = vfs->expandPath(&clientContext, dbPathStr);
     bufferManager = std::make_unique<BufferManager>(
         this->systemConfig.bufferPoolSize, this->systemConfig.maxDBSize);
     memoryManager = std::make_unique<MemoryManager>(bufferManager.get(), vfs.get());
diff --git a/test/c_api/database_test.cpp b/test/c_api/database_test.cpp
index 5424e03fda..1d7cbfd17d 100644
--- a/test/c_api/database_test.cpp
+++ b/test/c_api/database_test.cpp
@@ -58,3 +58,9 @@ TEST_F(CApiDatabaseTest, CreationInvalidPath) {
     auto database = kuzu_database_init(databasePathCStr, kuzu_default_system_config());
     ASSERT_EQ(database, nullptr);
 }
+
+TEST_F(CApiDatabaseTest, CreationHomeDir) {
+    auto databasePathCStr = (char*)"~/ku_test.db";
+    auto database = kuzu_database_init(databasePathCStr, kuzu_default_system_config());
+    ASSERT_NE(database, nullptr);
+}