diff --git a/packages/cli/src/commands/init.ts b/packages/cli/src/commands/init.ts
index f7e7250..49b77a8 100644
--- a/packages/cli/src/commands/init.ts
+++ b/packages/cli/src/commands/init.ts
@@ -25,6 +25,24 @@ export interface InitArgs {
 const DEFAULT_MODEL = "anthropic/claude-sonnet-4-6";
 const DEFAULT_FLAIR = "http://127.0.0.1:9926";
 
+/**
+ * Resolve the effective home directory.
+ *
+ * Prefers $HOME (or %USERPROFILE% on Windows) over node:os's homedir(),
+ * which resolves via the OS user database (getpwuid) as a fallback.
+ * In a container running as root with no matching /etc/passwd entry for
+ * an image-injected HOME override (e.g. our Docker test image sets
+ * HOME=/home/tps without creating a real "tps" user), homedir() and a
+ * live $HOME override can disagree — and Bun's os.homedir() has been
+ * observed to cache its result independent of later env mutations,
+ * so two independent callers (this process and any subprocess it spawns)
+ * are not guaranteed to agree unless they both read the same live env var.
+ * Reading process.env.HOME directly sidesteps that class of mismatch.
+ */
+function resolveHome(): string {
+  return process.env.HOME || process.env.USERPROFILE || homedir();
+}
+
 function generateEd25519Key(keyPath: string, pubPath: string): void {
   const { privateKey, publicKey } = generateKeyPairSync("ed25519");
   const privDer = privateKey.export({ type: "pkcs8", format: "der" }) as Buffer;
@@ -34,8 +52,7 @@ function generateEd25519Key(keyPath: string, pubPath: string): void {
   writeFileSync(pubPath, pubDer.subarray(12).toString("hex") + "\n", { mode: 0o644 });
 }
 
-function agentYaml(agentId: string, model: string, flairUrl: string): string {
-  const home = homedir();
+function agentYaml(agentId: string, model: string, flairUrl: string, home: string): string {
   return `# TPS Agent config — generated by tps init
 agentId: ${agentId}
 name: ${agentId}
@@ -85,7 +102,7 @@ async function registerWithFlair(
 }
 
 export async function runInit(args: InitArgs): Promise<void> {
-  const home = homedir();
+  const home = resolveHome();
   const agentId = args.agentId ?? "my-agent";
   const name = args.name ?? agentId;
   const flairUrl = args.flairUrl ?? process.env.FLAIR_URL ?? DEFAULT_FLAIR;
@@ -124,7 +141,7 @@ export async function runInit(args: InitArgs): Promise<void> {
   }
 
   // 3. agent.yaml
-  writeFileSync(configPath, agentYaml(agentId, model, flairUrl), { mode: 0o644 });
+  writeFileSync(configPath, agentYaml(agentId, model, flairUrl, home), { mode: 0o644 });
   console.log(`✓ Agent config written: ~/.tps/agents/${agentId}/agent.yaml`);
 
   // 4. Workspace README
diff --git a/packages/cli/test/init.test.ts b/packages/cli/test/init.test.ts
index 97ad5e2..de5e70b 100644
--- a/packages/cli/test/init.test.ts
+++ b/packages/cli/test/init.test.ts
@@ -5,7 +5,17 @@ import { join, resolve } from "node:path";
 import { homedir } from "node:os";
 
 const TPS_BIN = resolve(import.meta.dir, "../bin/tps.ts");
-const HOME = homedir();
+// Prefer the live $HOME over homedir(), which resolves via the OS user
+// database as a fallback. In the Docker test image (root, no matching
+// /etc/passwd entry for the injected HOME=/home/tps) that fallback can
+// disagree with $HOME, and Bun's os.homedir() has been observed to cache
+// its result independent of later env mutations performed by sibling test
+// files in this same process — so relying on it here (and independently
+// again inside the spawned subprocess) risks the test's expected path and
+// the subprocess's actual write path silently diverging. Reading
+// process.env.HOME directly, and threading that same string through to
+// the subprocess's env below, keeps both sides in lockstep.
+const HOME = process.env.HOME || homedir();
 const TEST_ID = "tps-init-test-agent";
 
 afterEach(() => {
@@ -32,15 +42,15 @@ describe("tps init", () => {
   });
 
   test("errors if agent already exists without --force", () => {
-    spawnSync("bun", [TPS_BIN, "init", "--id", TEST_ID], { encoding: "utf-8", env: process.env });
-    const result = spawnSync("bun", [TPS_BIN, "init", "--id", TEST_ID], { encoding: "utf-8", env: process.env });
+    spawnSync("bun", [TPS_BIN, "init", "--id", TEST_ID], { encoding: "utf-8", env: { ...process.env, HOME } });
+    const result = spawnSync("bun", [TPS_BIN, "init", "--id", TEST_ID], { encoding: "utf-8", env: { ...process.env, HOME } });
     expect(result.status).not.toBe(0);
     expect((result.stderr ?? "") + (result.stdout ?? "")).toContain("already exists");
   });
 
   test("--force overwrites existing", () => {
-    spawnSync("bun", [TPS_BIN, "init", "--id", TEST_ID], { encoding: "utf-8", env: process.env });
-    const result = spawnSync("bun", [TPS_BIN, "init", "--id", TEST_ID, "--force"], { encoding: "utf-8", env: process.env });
+    spawnSync("bun", [TPS_BIN, "init", "--id", TEST_ID], { encoding: "utf-8", env: { ...process.env, HOME } });
+    const result = spawnSync("bun", [TPS_BIN, "init", "--id", TEST_ID, "--force"], { encoding: "utf-8", env: { ...process.env, HOME } });
     expect(result.status).toBe(0);
   });
 });