@@ -98,7 +98,9 @@ def __init__(self, git_dir=None):
 		
 		``git_dir``
 		   Git directory we should work in. If None, we always work in the current 
-		   directory as returned by os.getcwd()
+		   directory as returned by os.getcwd().
+		   It is meant to be the working tree directory if available, or the 
+		   .git directory in case of bare repositories.
 		"""
 		super(Git, self).__init__()
 		self.git_dir = git_dir
 
@@ -88,7 +88,7 @@ def __init__(self, path=None):
 		while curpath:
 			if is_git_dir(curpath):
 				self.path = curpath
-				self.wd = curpath
+				self.wd = os.path.dirname(curpath)
 				break
 			gitpath = os.path.join(curpath, '.git')
 			if is_git_dir(gitpath):
@@ -99,16 +99,21 @@ def __init__(self, path=None):
 			if not dummy:
 				break
 		# END while curpath
+		
+		if self.path is None:
+		   raise InvalidGitRepositoryError(epath)
 
 		self._bare = False
 		try:
 			self._bare = self.config_reader("repository").getboolean('core','bare') 
 		except Exception:
 			# lets not assume the option exists, although it should
 			pass
-		
-		if self.path is None:
-		   raise InvalidGitRepositoryError(epath)
+
+		# adjust the wd in case we are actually bare - we didn't know that 
+		# in the first place
+		if self._bare:
+			self.wd = self.path
 
 		self.git = Git(self.wd)
 
 
@@ -20,6 +20,13 @@ def test_new_should_raise_on_invalid_repo_location(self):
 	def test_new_should_raise_on_non_existant_path(self):
 		Repo("repos/foobar")
 
+	def test_repo_creation_from_different_paths(self):
+		r_from_gitdir = Repo(self.rorepo.path)
+		assert r_from_gitdir.path == self.rorepo.path
+		assert r_from_gitdir.path.endswith('.git')
+		assert not self.rorepo.git.git_dir.endswith('.git')
+		assert r_from_gitdir.git.git_dir == self.rorepo.git.git_dir
+
 	def test_description(self):
 		txt = "Test repository"
 		self.rorepo.description = txt