diff --git a/cmd/jb/install.go b/cmd/jb/install.go
index 292b92d..c84515a 100644
--- a/cmd/jb/install.go
+++ b/cmd/jb/install.go
@@ -68,7 +68,7 @@ func installCommand(dir, jsonnetHome string, uris []string) int {
 		}
 	}
 
-	locked, err := pkg.Ensure(jsonnetFile, jsonnetHome, lockFile.Dependencies)
+	locked, err := pkg.Ensure(jsonnetFile, filepath.Join(dir, jsonnetHome), lockFile.Dependencies)
 	kingpin.FatalIfError(err, "failed to install packages")
 
 	pkg.CleanLegacyName(jsonnetFile.Dependencies)
diff --git a/cmd/jb/update.go b/cmd/jb/update.go
index f68bd89..e8ff2e7 100644
--- a/cmd/jb/update.go
+++ b/cmd/jb/update.go
@@ -58,7 +58,7 @@ func updateCommand(dir, jsonnetHome string, uris []string) int {
 		locks = make(map[string]deps.Dependency)
 	}
 
-	newLocks, err := pkg.Ensure(jsonnetFile, jsonnetHome, locks)
+	newLocks, err := pkg.Ensure(jsonnetFile, filepath.Join(dir, jsonnetHome), locks)
 	kingpin.FatalIfError(err, "updating")
 
 	kingpin.FatalIfError(
diff --git a/cmd/jb/update_test.go b/cmd/jb/update_test.go
new file mode 100644
index 0000000..3dd5e32
--- /dev/null
+++ b/cmd/jb/update_test.go
@@ -0,0 +1,130 @@
+// Copyright 2018 jsonnet-bundler authors
+//
+// Licensed under the Apache License, Version 2.0 (the "License");
+// you may not use this file except in compliance with the License.
+// You may obtain a copy of the License at
+//
+//     http://www.apache.org/licenses/LICENSE-2.0
+//
+// Unless required by applicable law or agreed to in writing, software
+// distributed under the License is distributed on an "AS IS" BASIS,
+// WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+// See the License for the specific language governing permissions and
+// limitations under the License.
+
+// +build integration
+
+package main
+
+import (
+	"io/ioutil"
+	"os"
+	"path/filepath"
+	"testing"
+
+	"github.com/jsonnet-bundler/jsonnet-bundler/pkg/jsonnetfile"
+	"github.com/stretchr/testify/assert"
+	"github.com/stretchr/testify/require"
+)
+
+// RepoState describes a point in time of a repository
+type RepoState struct {
+	File string
+	Lock string
+}
+
+// FilePath is the path to the jsonnetfile.json
+func (rs RepoState) FilePath(dir string) string {
+	return filepath.Join(dir, jsonnetfile.File)
+}
+
+// LockPath is the path to the jsonnetfile.lock.json
+func (rs RepoState) LockPath(dir string) string {
+	return filepath.Join(dir, jsonnetfile.LockFile)
+}
+
+// Write writes this state to dir
+func (rs RepoState) Write(dir string) error {
+	if err := ioutil.WriteFile(rs.FilePath(dir), []byte(rs.File), 0644); err != nil {
+		return err
+	}
+	if err := ioutil.WriteFile(rs.LockPath(dir), []byte(rs.Lock), 0644); err != nil {
+		return err
+	}
+	if err := os.MkdirAll(filepath.Join(dir, "vendor/"), os.ModePerm); err != nil {
+		return err
+	}
+	return nil
+}
+
+// Assert checks that dir matches this state
+func (rs RepoState) Assert(t *testing.T, dir string) {
+	file, err := ioutil.ReadFile(rs.FilePath(dir))
+	require.NoError(t, err)
+	assert.JSONEq(t, rs.File, string(file))
+
+	lock, err := ioutil.ReadFile(rs.LockPath(dir))
+	require.NoError(t, err)
+	assert.JSONEq(t, rs.Lock, string(lock))
+}
+
+// UpdateCase is a testcase for jb update
+type UpdateCase struct {
+	name   string
+	uris   []string
+	before *RepoState
+	after  *RepoState
+}
+
+func (u UpdateCase) Run(t *testing.T) {
+	dir, err := ioutil.TempDir("", u.name)
+	require.NoError(t, err)
+	defer os.RemoveAll(dir)
+
+	if u.before == nil {
+		initCommand(dir)
+	} else {
+		err = u.before.Write(dir)
+		require.NoError(t, err)
+	}
+
+	ret := updateCommand(dir, "vendor", u.uris)
+	assert.Equal(t, ret, 0)
+
+	if u.after != nil {
+		u.after.Assert(t, dir)
+	}
+}
+
+func TestUpdate(t *testing.T) {
+	cases := []UpdateCase{
+		{
+			name: "simple",
+			uris: []string{}, // no uris
+			before: &RepoState{
+				File: `{"version":1,"dependencies":[{"source":{"git":{"remote":"https://github.com/jsonnet-bundler/frozen-lib","subdir":""}},"version":"master"}],"legacyImports":true}`,
+				Lock: `{"version":1,"dependencies":[{"source":{"git":{"remote":"https://github.com/jsonnet-bundler/frozen-lib","subdir":""}},"version":"9f40207f668e382b706e1822f2d46ce2cd0a57cc","sum":"qUJDskVRtmkTms2udvFpLi1t5YKVbGmMSyiZnPjXsMo="}],"legacyImports":false}`,
+			},
+			after: &RepoState{
+				File: `{"version":1,"dependencies":[{"source":{"git":{"remote":"https://github.com/jsonnet-bundler/frozen-lib","subdir":""}},"version":"master"}],"legacyImports":true}`,
+				Lock: `{"version":1,"dependencies":[{"source":{"git":{"remote":"https://github.com/jsonnet-bundler/frozen-lib","subdir":""}},"version":"ed7c1aff9e10d3b42fb130446d495f1c769ecd7b","sum":"OraOcUvDIx9Eikaihi8XsRNRsVehO75Ek35im/jYoSA="}],"legacyImports":false}`,
+			},
+		},
+		{
+			name: "single",
+			uris: []string{"github.com/jsonnet-bundler/frozen-lib"},
+			before: &RepoState{
+				File: `{"version":1,"dependencies":[{"source":{"git":{"remote":"https://github.com/grafana/jsonnet-libs","subdir":"ksonnet-util"}},"version":"master"},{"source":{"git":{"remote":"https://github.com/jsonnet-bundler/frozen-lib","subdir":""}},"version":"master"}],"legacyImports":true}`,
+				Lock: `{"version":1,"dependencies":[{"source":{"git":{"remote":"https://github.com/grafana/jsonnet-libs","subdir":"ksonnet-util"}},"version":"610b00d219d0a6f3d833dd44e4bb0deda2429da0","sum":"XdIrw3m7I8fJ3CL9eR8LtuYcanf2QK78n4H4OBBOADc="},{"source":{"git":{"remote":"https://github.com/jsonnet-bundler/frozen-lib","subdir":""}},"version":"9f40207f668e382b706e1822f2d46ce2cd0a57cc","sum":"qUJDskVRtmkTms2udvFpLi1t5YKVbGmMSyiZnPjXsMo="}],"legacyImports":false}`,
+			},
+			after: &RepoState{
+				File: `{"version":1,"dependencies":[{"source":{"git":{"remote":"https://github.com/grafana/jsonnet-libs","subdir":"ksonnet-util"}},"version":"master"},{"source":{"git":{"remote":"https://github.com/jsonnet-bundler/frozen-lib","subdir":""}},"version":"master"}],"legacyImports":true}`,
+				Lock: `{"version":1,"dependencies":[{"source":{"git":{"remote":"https://github.com/grafana/jsonnet-libs","subdir":"ksonnet-util"}},"version":"610b00d219d0a6f3d833dd44e4bb0deda2429da0","sum":"XdIrw3m7I8fJ3CL9eR8LtuYcanf2QK78n4H4OBBOADc="},{"source":{"git":{"remote":"https://github.com/jsonnet-bundler/frozen-lib","subdir":""}},"version":"ed7c1aff9e10d3b42fb130446d495f1c769ecd7b","sum":"OraOcUvDIx9Eikaihi8XsRNRsVehO75Ek35im/jYoSA="}],"legacyImports":false}`,
+			},
+		},
+	}
+
+	for _, c := range cases {
+		t.Run(c.name, c.Run)
+	}
+}