diff --git a/compiler/daemon/daemon-client/src/org/jetbrains/kotlin/daemon/client/KotlinCompilerClient.kt b/compiler/daemon/daemon-client/src/org/jetbrains/kotlin/daemon/client/KotlinCompilerClient.kt
index 2fa802240ea..5b85b279eff 100644
--- a/compiler/daemon/daemon-client/src/org/jetbrains/kotlin/daemon/client/KotlinCompilerClient.kt
+++ b/compiler/daemon/daemon-client/src/org/jetbrains/kotlin/daemon/client/KotlinCompilerClient.kt
@@ -379,6 +379,8 @@ object KotlinCompilerClient {
         reportingTargets.report(DaemonReportCategory.DEBUG, "starting the daemon as: " + args.joinToString(" "))
         val processBuilder = ProcessBuilder(args)
         processBuilder.redirectErrorStream(true)
+        val workingDir = File(daemonOptions.runFilesPath).apply { mkdirs() }
+        processBuilder.directory(workingDir)
         // assuming daemon process is deaf and (mostly) silent, so do not handle streams
         val daemon = launchProcessWithFallback(processBuilder, reportingTargets, "daemon client")
 
diff --git a/libraries/tools/kotlin-gradle-plugin-integration-tests/src/test/kotlin/org/jetbrains/kotlin/gradle/KotlinGradlePluginIT.kt b/libraries/tools/kotlin-gradle-plugin-integration-tests/src/test/kotlin/org/jetbrains/kotlin/gradle/KotlinGradlePluginIT.kt
index 99b4a0e737f..1e38c77bc00 100644
--- a/libraries/tools/kotlin-gradle-plugin-integration-tests/src/test/kotlin/org/jetbrains/kotlin/gradle/KotlinGradlePluginIT.kt
+++ b/libraries/tools/kotlin-gradle-plugin-integration-tests/src/test/kotlin/org/jetbrains/kotlin/gradle/KotlinGradlePluginIT.kt
@@ -64,7 +64,12 @@ class KotlinGradleIT : BaseGradleIT() {
         val wd2 = createTempDir("testRunningInDifferentDir")
         wd1.copyRecursively(wd2)
         wd1.deleteRecursively()
-        assert(!wd1.exists())
+        if (wd1.exists()) {
+            val files = buildString {
+                wd1.walk().forEach { appendln("  " + it.relativeTo(wd1).path) }
+            }
+            error("Some files in $wd1 were not removed:\n$files")
+        }
         wd0.setWritable(false)
         workingDir = wd2