Index: src/org/jruby/util/JRubyFile.java
===================================================================
--- src/org/jruby/util/JRubyFile.java	(revision 3721)
+++ src/org/jruby/util/JRubyFile.java	(working copy)
@@ -44,7 +44,12 @@
     private static final long serialVersionUID = 435364547567567L;
 
     public static JRubyFile create(String cwd, String pathname) {
-        File internal = new File(pathname);
+        File internal = null;
+        try {
+            internal = new File((new File(pathname)).getCanonicalPath());
+        } catch (IOException e) {
+            throw new IllegalArgumentException("Neither current working directory ("+cwd+") nor pathname ("+pathname+") led to an absolute path");
+        }
         if(!internal.isAbsolute()) {
             internal = new File(cwd,pathname);
             if(!internal.isAbsolute()) {