diff --git a/Makefile b/Makefile
index d10895f3c8..9f3a8ab097 100644
--- a/Makefile
+++ b/Makefile
@@ -182,28 +182,32 @@ STRIP ?= strip
 # Among the variables below, these:
 #   gitexecdir
 #   template_dir
+#   mandir
+#   infodir
 #   htmldir
 #   ETC_GITCONFIG (but not sysconfdir)
-# can be specified as a relative path ../some/where/else (which must begin
-# with ../); this is interpreted as relative to $(bindir) and "git" at
+# can be specified as a relative path some/where/else;
+# this is interpreted as relative to $(prefix) and "git" at
 # runtime figures out where they are based on the path to the executable.
 # This can help installing the suite in a relocatable way.
 
 prefix = $(HOME)
-bindir = $(prefix)/bin
-mandir = $(prefix)/share/man
-infodir = $(prefix)/share/info
-gitexecdir = $(prefix)/libexec/git-core
+bindir_relative = bin
+bindir = $(prefix)/$(bindir_relative)
+mandir = share/man
+infodir = share/info
+gitexecdir = libexec/git-core
 sharedir = $(prefix)/share
-template_dir = $(sharedir)/git-core/templates
-htmldir=$(sharedir)/doc/git-doc
+template_dir = share/git-core/templates
+htmldir = share/doc/git-doc
 ifeq ($(prefix),/usr)
 sysconfdir = /etc
+ETC_GITCONFIG = $(sysconfdir)/gitconfig
 else
 sysconfdir = $(prefix)/etc
+ETC_GITCONFIG = etc/gitconfig
 endif
 lib = lib
-ETC_GITCONFIG = $(sysconfdir)/gitconfig
 # DESTDIR=
 
 # default configuration for gitweb
@@ -790,6 +794,7 @@ ifneq (,$(findstring MINGW,$(uname_S)))
 	SNPRINTF_RETURNS_BOGUS = YesPlease
 	NO_SVN_TESTS = YesPlease
 	NO_PERL_MAKEMAKER = YesPlease
+	RUNTIME_PREFIX = YesPlease
 	NO_POSIX_ONLY_PROGRAMS = YesPlease
 	NO_ST_BLOCKS_IN_STRUCT_STAT = YesPlease
 	COMPAT_CFLAGS += -D__USE_MINGW_ACCESS -DNOGDI -Icompat -Icompat/regex -Icompat/fnmatch
@@ -798,9 +803,6 @@ ifneq (,$(findstring MINGW,$(uname_S)))
 	COMPAT_OBJS += compat/mingw.o compat/fnmatch/fnmatch.o compat/regex/regex.o compat/winansi.o
 	EXTLIBS += -lws2_32
 	X = .exe
-	gitexecdir = ../libexec/git-core
-	template_dir = ../share/git-core/templates/
-	ETC_GITCONFIG = ../etc/gitconfig
 endif
 ifneq (,$(findstring arm,$(uname_M)))
 	ARM_SHA1 = YesPlease
@@ -1038,6 +1040,9 @@ ifdef INTERNAL_QSORT
 	COMPAT_CFLAGS += -DINTERNAL_QSORT
 	COMPAT_OBJS += compat/qsort.o
 endif
+ifdef RUNTIME_PREFIX
+	COMPAT_CFLAGS += -DRUNTIME_PREFIX
+endif
 
 ifdef NO_PTHREADS
 	THREADED_DELTA_SEARCH =
@@ -1097,6 +1102,7 @@ ETC_GITCONFIG_SQ = $(subst ','\'',$(ETC_GITCONFIG))
 
 DESTDIR_SQ = $(subst ','\'',$(DESTDIR))
 bindir_SQ = $(subst ','\'',$(bindir))
+bindir_relative_SQ = $(subst ','\'',$(bindir_relative))
 mandir_SQ = $(subst ','\'',$(mandir))
 infodir_SQ = $(subst ','\'',$(infodir))
 gitexecdir_SQ = $(subst ','\'',$(gitexecdir))
@@ -1262,7 +1268,12 @@ git.o git.spec \
 	$(QUIET_CC)$(CC) -o $*.o -c $(ALL_CFLAGS) $<
 
 exec_cmd.o: exec_cmd.c GIT-CFLAGS
-	$(QUIET_CC)$(CC) -o $*.o -c $(ALL_CFLAGS) '-DGIT_EXEC_PATH="$(gitexecdir_SQ)"' $<
+	$(QUIET_CC)$(CC) -o $*.o -c $(ALL_CFLAGS) \
+		'-DGIT_EXEC_PATH="$(gitexecdir_SQ)"' \
+		'-DBINDIR="$(bindir_relative_SQ)"' \
+		'-DPREFIX="$(prefix_SQ)"' \
+		$<
+
 builtin-init-db.o: builtin-init-db.c GIT-CFLAGS
 	$(QUIET_CC)$(CC) -o $*.o -c $(ALL_CFLAGS) -DDEFAULT_GIT_TEMPLATE_DIR='"$(template_dir_SQ)"' $<
 
@@ -1422,17 +1433,17 @@ remove-dashes:
 
 ### Installation rules
 
-ifeq ($(firstword $(subst /, ,$(template_dir))),..)
-template_instdir = $(bindir)/$(template_dir)
-else
+ifeq ($(abspath $(template_dir)),$(template_dir))
 template_instdir = $(template_dir)
+else
+template_instdir = $(prefix)/$(template_dir)
 endif
 export template_instdir
 
-ifeq ($(firstword $(subst /, ,$(gitexecdir))),..)
-gitexec_instdir = $(bindir)/$(gitexecdir)
-else
+ifeq ($(abspath $(gitexecdir)),$(gitexecdir))
 gitexec_instdir = $(gitexecdir)
+else
+gitexec_instdir = $(prefix)/$(gitexecdir)
 endif
 gitexec_instdir_SQ = $(subst ','\'',$(gitexec_instdir))
 export gitexec_instdir
diff --git a/builtin-help.c b/builtin-help.c
index f076efa921..9b57a74618 100644
--- a/builtin-help.c
+++ b/builtin-help.c
@@ -329,7 +329,7 @@ static void setup_man_path(void)
 	 * old_path, the ':' at the end will let 'man' to try
 	 * system-wide paths after ours to find the manual page. If
 	 * there is old_path, we need ':' as delimiter. */
-	strbuf_addstr(&new_path, GIT_MAN_PATH);
+	strbuf_addstr(&new_path, system_path(GIT_MAN_PATH));
 	strbuf_addch(&new_path, ':');
 	if (old_path)
 		strbuf_addstr(&new_path, old_path);
@@ -375,7 +375,7 @@ static void show_man_page(const char *git_cmd)
 static void show_info_page(const char *git_cmd)
 {
 	const char *page = cmd_to_page(git_cmd);
-	setenv("INFOPATH", GIT_INFO_PATH, 1);
+	setenv("INFOPATH", system_path(GIT_INFO_PATH), 1);
 	execlp("info", "info", "gitman", page, NULL);
 }
 
diff --git a/daemon.c b/daemon.c
index 540700ee84..d93cf960f9 100644
--- a/daemon.c
+++ b/daemon.c
@@ -937,6 +937,8 @@ int main(int argc, char **argv)
 	gid_t gid = 0;
 	int i;
 
+	git_extract_argv0_path(argv[0]);
+
 	for (i = 1; i < argc; i++) {
 		char *arg = argv[i];
 
diff --git a/exec_cmd.c b/exec_cmd.c
index cdd35f9195..f234066def 100644
--- a/exec_cmd.c
+++ b/exec_cmd.c
@@ -9,17 +9,78 @@ static const char *argv0_path;
 
 const char *system_path(const char *path)
 {
-	if (!is_absolute_path(path) && argv0_path) {
-		struct strbuf d = STRBUF_INIT;
-		strbuf_addf(&d, "%s/%s", argv0_path, path);
-		path = strbuf_detach(&d, NULL);
+#ifdef RUNTIME_PREFIX
+	static const char *prefix;
+#else
+	static const char *prefix = PREFIX;
+#endif
+	struct strbuf d = STRBUF_INIT;
+
+	if (is_absolute_path(path))
+		return path;
+
+#ifdef RUNTIME_PREFIX
+	assert(argv0_path);
+	assert(is_absolute_path(argv0_path));
+
+	if (!prefix) {
+		const char *strip[] = {
+			GIT_EXEC_PATH,
+			BINDIR,
+			0
+		};
+		const char **s;
+
+		for (s = strip; *s; s++) {
+			const char *sargv = argv0_path + strlen(argv0_path);
+			const char *ss = *s + strlen(*s);
+			while (argv0_path < sargv && *s < ss
+				&& (*sargv == *ss ||
+				    (is_dir_sep(*sargv) && is_dir_sep(*ss)))) {
+				sargv--;
+				ss--;
+			}
+			if (*s == ss) {
+				struct strbuf d = STRBUF_INIT;
+				/* We also skip the trailing directory separator. */
+				assert(sargv - argv0_path - 1 >= 0);
+				strbuf_add(&d, argv0_path, sargv - argv0_path - 1);
+				prefix = strbuf_detach(&d, NULL);
+				break;
+			}
+		}
 	}
+
+	if (!prefix) {
+		prefix = PREFIX;
+		fprintf(stderr, "RUNTIME_PREFIX requested, "
+				"but prefix computation failed.  "
+				"Using static fallback '%s'.\n", prefix);
+	}
+#endif
+
+	strbuf_addf(&d, "%s/%s", prefix, path);
+	path = strbuf_detach(&d, NULL);
 	return path;
 }
 
-void git_set_argv0_path(const char *path)
+const char *git_extract_argv0_path(const char *argv0)
 {
-	argv0_path = path;
+	const char *slash;
+
+	if (!argv0 || !*argv0)
+		return NULL;
+	slash = argv0 + strlen(argv0);
+
+	while (argv0 <= slash && !is_dir_sep(*slash))
+		slash--;
+
+	if (slash >= argv0) {
+		argv0_path = xstrndup(argv0, slash - argv0);
+		return slash + 1;
+	}
+
+	return argv0;
 }
 
 void git_set_argv_exec_path(const char *exec_path)
@@ -61,9 +122,7 @@ void setup_path(void)
 	const char *old_path = getenv("PATH");
 	struct strbuf new_path = STRBUF_INIT;
 
-	add_path(&new_path, argv_exec_path);
-	add_path(&new_path, getenv(EXEC_PATH_ENVIRONMENT));
-	add_path(&new_path, system_path(GIT_EXEC_PATH));
+	add_path(&new_path, git_exec_path());
 	add_path(&new_path, argv0_path);
 
 	if (old_path)
diff --git a/exec_cmd.h b/exec_cmd.h
index 594f961387..e2b546b615 100644
--- a/exec_cmd.h
+++ b/exec_cmd.h
@@ -2,8 +2,8 @@
 #define GIT_EXEC_CMD_H
 
 extern void git_set_argv_exec_path(const char *exec_path);
-extern void git_set_argv0_path(const char *path);
-extern const char* git_exec_path(void);
+extern const char *git_extract_argv0_path(const char *path);
+extern const char *git_exec_path(void);
 extern void setup_path(void);
 extern const char **prepare_git_cmd(const char **argv);
 extern int execv_git_cmd(const char **argv); /* NULL terminated */
diff --git a/fast-import.c b/fast-import.c
index f0e08aca70..1935206be0 100644
--- a/fast-import.c
+++ b/fast-import.c
@@ -150,6 +150,7 @@ Format of STDIN stream:
 #include "refs.h"
 #include "csum-file.h"
 #include "quote.h"
+#include "exec_cmd.h"
 
 #define PACK_ID_BITS 16
 #define MAX_PACK_ID ((1<<PACK_ID_BITS)-1)
@@ -2406,6 +2407,8 @@ int main(int argc, const char **argv)
 {
 	unsigned int i, show_stats = 1;
 
+	git_extract_argv0_path(argv[0]);
+
 	setup_git_directory();
 	git_config(git_pack_config, NULL);
 	if (!pack_compression_seen && core_compression_seen)
diff --git a/git.c b/git.c
index ecc8fad09a..320cb43564 100644
--- a/git.c
+++ b/git.c
@@ -442,21 +442,11 @@ static int run_argv(int *argcp, const char ***argv)
 
 int main(int argc, const char **argv)
 {
-	const char *cmd = argv[0] && *argv[0] ? argv[0] : "git-help";
-	char *slash = (char *)cmd + strlen(cmd);
+	const char *cmd;
 
-	/*
-	 * Take the basename of argv[0] as the command
-	 * name, and the dirname as the default exec_path
-	 * if we don't have anything better.
-	 */
-	while (cmd <= slash && !is_dir_sep(*slash))
-		slash--;
-	if (cmd <= slash) {
-		*slash++ = 0;
-		git_set_argv0_path(cmd);
-		cmd = slash;
-	}
+	cmd = git_extract_argv0_path(argv[0]);
+	if (!cmd)
+		cmd = "git-help";
 
 	/*
 	 * "git-xxxx" is the same as "git xxxx", but we obviously:
diff --git a/hash-object.c b/hash-object.c
index 846e91a231..37e66779ab 100644
--- a/hash-object.c
+++ b/hash-object.c
@@ -8,6 +8,7 @@
 #include "blob.h"
 #include "quote.h"
 #include "parse-options.h"
+#include "exec_cmd.h"
 
 static void hash_fd(int fd, const char *type, int write_object, const char *path)
 {
@@ -81,6 +82,8 @@ int main(int argc, const char **argv)
 
 	type = blob_type;
 
+	git_extract_argv0_path(argv[0]);
+
 	git_config(git_default_config, NULL);
 
 	argc = parse_options(argc, argv, hash_object_options, hash_object_usage, 0);
diff --git a/http-push.c b/http-push.c
index 53c14141e0..18d81acd1b 100644
--- a/http-push.c
+++ b/http-push.c
@@ -2196,6 +2196,8 @@ int main(int argc, char **argv)
 	struct ref *ref;
 	char *rewritten_url = NULL;
 
+	git_extract_argv0_path(argv[0]);
+
 	setup_git_directory();
 
 	remote = xcalloc(sizeof(*remote), 1);
diff --git a/imap-send.c b/imap-send.c
index c3fa0df855..f91293c23f 100644
--- a/imap-send.c
+++ b/imap-send.c
@@ -23,6 +23,7 @@
  */
 
 #include "cache.h"
+#include "exec_cmd.h"
 #ifdef NO_OPENSSL
 typedef void *SSL;
 #endif
@@ -1389,6 +1390,8 @@ int main(int argc, char **argv)
 	int total, n = 0;
 	int nongit_ok;
 
+	git_extract_argv0_path(argv[0]);
+
 	/* init the random number generator */
 	arc4_init();
 
diff --git a/index-pack.c b/index-pack.c
index b46a6d6597..f7a38079e1 100644
--- a/index-pack.c
+++ b/index-pack.c
@@ -8,6 +8,7 @@
 #include "tree.h"
 #include "progress.h"
 #include "fsck.h"
+#include "exec_cmd.h"
 
 static const char index_pack_usage[] =
 "git index-pack [-v] [-o <index-file>] [{ ---keep | --keep=<msg> }] [--strict] { <pack-file> | --stdin [--fix-thin] [<pack-file>] }";
@@ -880,6 +881,8 @@ int main(int argc, char **argv)
 	struct pack_idx_entry **idx_objects;
 	unsigned char pack_sha1[20];
 
+	git_extract_argv0_path(argv[0]);
+
 	/*
 	 * We wish to read the repository's config file if any, and
 	 * for that it is necessary to call setup_git_directory_gently().
diff --git a/merge-index.c b/merge-index.c
index 7827e87a92..c00a2b385a 100644
--- a/merge-index.c
+++ b/merge-index.c
@@ -1,5 +1,6 @@
 #include "cache.h"
 #include "run-command.h"
+#include "exec_cmd.h"
 
 static const char *pgm;
 static const char *arguments[9];
@@ -93,6 +94,8 @@ int main(int argc, char **argv)
 	if (argc < 3)
 		usage("git-merge-index [-o] [-q] <merge-program> (-a | [--] <filename>*)");
 
+	git_extract_argv0_path(argv[0]);
+
 	setup_git_directory();
 	read_cache();
 
diff --git a/merge-tree.c b/merge-tree.c
index 2d1413efbb..f18201acdb 100644
--- a/merge-tree.c
+++ b/merge-tree.c
@@ -2,6 +2,7 @@
 #include "tree-walk.h"
 #include "xdiff-interface.h"
 #include "blob.h"
+#include "exec_cmd.h"
 
 static const char merge_tree_usage[] = "git-merge-tree <base-tree> <branch1> <branch2>";
 static int resolve_directories = 1;
@@ -344,6 +345,8 @@ int main(int argc, char **argv)
 	if (argc != 4)
 		usage(merge_tree_usage);
 
+	git_extract_argv0_path(argv[0]);
+
 	setup_git_directory();
 
 	buf1 = get_tree_descriptor(t+0, argv[1]);
diff --git a/mktag.c b/mktag.c
index ba3d495e07..6d5083eaf0 100644
--- a/mktag.c
+++ b/mktag.c
@@ -1,5 +1,6 @@
 #include "cache.h"
 #include "tag.h"
+#include "exec_cmd.h"
 
 /*
  * A signature file has a very simple fixed format: four lines
@@ -159,6 +160,8 @@ int main(int argc, char **argv)
 	if (argc != 1)
 		usage("git-mktag < signaturefile");
 
+	git_extract_argv0_path(argv[0]);
+
 	setup_git_directory();
 
 	if (strbuf_read(&buf, 0, 4096) < 0) {
diff --git a/mktree.c b/mktree.c
index 514fd9b15a..6283bc3d43 100644
--- a/mktree.c
+++ b/mktree.c
@@ -6,6 +6,7 @@
 #include "cache.h"
 #include "quote.h"
 #include "tree.h"
+#include "exec_cmd.h"
 
 static struct treeent {
 	unsigned mode;
@@ -70,6 +71,8 @@ int main(int ac, char **av)
 	unsigned char sha1[20];
 	int line_termination = '\n';
 
+	git_extract_argv0_path(av[0]);
+
 	setup_git_directory();
 
 	while ((1 < ac) && av[1][0] == '-') {
diff --git a/pack-redundant.c b/pack-redundant.c
index e93eb966e2..48a12bc135 100644
--- a/pack-redundant.c
+++ b/pack-redundant.c
@@ -7,6 +7,7 @@
 */
 
 #include "cache.h"
+#include "exec_cmd.h"
 
 #define BLKSIZE 512
 
@@ -601,6 +602,8 @@ int main(int argc, char **argv)
 	unsigned char *sha1;
 	char buf[42]; /* 40 byte sha1 + \n + \0 */
 
+	git_extract_argv0_path(argv[0]);
+
 	setup_git_directory();
 
 	for (i = 1; i < argc; i++) {
diff --git a/patch-id.c b/patch-id.c
index 871f1d20c0..3660ad461d 100644
--- a/patch-id.c
+++ b/patch-id.c
@@ -1,4 +1,5 @@
 #include "cache.h"
+#include "exec_cmd.h"
 
 static void flush_current_id(int patchlen, unsigned char *id, git_SHA_CTX *c)
 {
@@ -79,6 +80,8 @@ int main(int argc, char **argv)
 	if (argc != 1)
 		usage(patch_id_usage);
 
+	git_extract_argv0_path(argv[0]);
+
 	generate_id_list();
 	return 0;
 }
diff --git a/unpack-file.c b/unpack-file.c
index bcdc8bbb3b..6dd8ad02fb 100644
--- a/unpack-file.c
+++ b/unpack-file.c
@@ -1,5 +1,6 @@
 #include "cache.h"
 #include "blob.h"
+#include "exec_cmd.h"
 
 static char *create_temp_file(unsigned char *sha1)
 {
@@ -25,6 +26,8 @@ int main(int argc, char **argv)
 {
 	unsigned char sha1[20];
 
+	git_extract_argv0_path(argv[0]);
+
 	if (argc != 2)
 		usage("git-unpack-file <sha1>");
 	if (get_sha1(argv[1], sha1))
diff --git a/update-server-info.c b/update-server-info.c
index 7e8209ea4b..7b38fd867b 100644
--- a/update-server-info.c
+++ b/update-server-info.c
@@ -1,4 +1,5 @@
 #include "cache.h"
+#include "exec_cmd.h"
 
 static const char update_server_info_usage[] =
 "git update-server-info [--force]";
@@ -19,6 +20,8 @@ int main(int ac, char **av)
 	if (i != ac)
 		usage(update_server_info_usage);
 
+	git_extract_argv0_path(av[0]);
+
 	setup_git_directory();
 
 	return !!update_server_info(force);
diff --git a/upload-pack.c b/upload-pack.c
index e5adbc011e..5db6f93955 100644
--- a/upload-pack.c
+++ b/upload-pack.c
@@ -616,6 +616,8 @@ int main(int argc, char **argv)
 	int i;
 	int strict = 0;
 
+	git_extract_argv0_path(argv[0]);
+
 	for (i = 1; i < argc; i++) {
 		char *arg = argv[i];
 
diff --git a/var.c b/var.c
index f1eb314e89..7362ed8735 100644
--- a/var.c
+++ b/var.c
@@ -4,6 +4,7 @@
  * Copyright (C) Eric Biederman, 2005
  */
 #include "cache.h"
+#include "exec_cmd.h"
 
 static const char var_usage[] = "git var [-l | <variable>]";
 
@@ -56,6 +57,8 @@ int main(int argc, char **argv)
 		usage(var_usage);
 	}
 
+	git_extract_argv0_path(argv[0]);
+
 	setup_git_directory_gently(&nongit);
 	val = NULL;