Also files relative to load path dirs.

Oops, fix typo in comments.

Switch to  backticks instead of plusses.

Set and unset  in a context.

Remove unnecessary #basename.

Remove early File#basename so relative paths actually work.

lib/pry/code.rb

@@ -117,19 +117,31 @@ class Pry
       end
 
       # @param [String] filename
-      # @raise [MethodSource::SourceNotFoundError] if the +filename+ is not
+      # @raise [MethodSource::SourceNotFoundError] if the `filename` is not
       #   readable for some reason.
-      # @return [String] absolute path for the given +filename+.
+      # @return [String] absolute path for the given `filename`.
       def abs_path(filename)
-        abs_path = [File.expand_path(filename, Dir.pwd),
-                    File.expand_path(filename, Pry::INITIAL_PWD)
-                   ].detect { |path| File.readable?(path) }
-        abs_path ||= $LOAD_PATH.map do |path|
-                       File.expand_path(File.basename(filename), path)
-                     end.detect { |path| File.readable?(path) if path }
+        abs_path = find_path_in_pwd(filename) ||
+                   find_path_in_load_path(filename)
         abs_path or raise MethodSource::SourceNotFoundError,
                           "Cannot open #{filename.inspect} for reading."
       end
+
+      # @param [String] filename
+      # @return [String] absolute path for the given `filename` or nil.
+      def find_path_in_pwd(filename)
+        [File.expand_path(filename, Dir.pwd),
+         File.expand_path(filename, Pry::INITIAL_PWD)
+        ].detect { |path| File.readable?(path) if path }
+      end
+
+      # @param [String] filename
+      # @return [String] absolute path for the given `filename` or nil.
+      def find_path_in_load_path(filename)
+        $LOAD_PATH.map do |path|
+          File.expand_path(filename, path)
+        end.detect { |path| File.readable?(path) if path }
+      end
     end
 
     # @return [Symbol] The type of code stored in this wrapper.

lib/pry/commands/cat/file_formatter.rb

@@ -23,7 +23,7 @@ class Pry
       def file_and_line
         file_name, line_num = file_with_embedded_line.split(':')
 
-        [File.expand_path(file_name), line_num ? line_num.to_i : nil]
+        [file_name, line_num ? line_num.to_i : nil]
       end
 
       def file_name

spec/code_spec.rb

@@ -47,9 +47,22 @@ describe Pry::Code do
       end
     end
 
-    should 'find files that are relative to a directory in the $LOAD_PATH' do
-      $LOAD_PATH << 'spec'
-      Pry::Code.from_file(File.basename(__FILE__)).code_type.should == :ruby
+    describe 'find files that are relative to the $LOAD_PATH' do
+      before do
+        $LOAD_PATH << 'spec/commands'
+      end
+
+      after do
+        $LOAD_PATH.delete 'spec/commands'
+      end
+
+      should 'find files that are in a directory in the $LOAD_PATH' do
+        Pry::Code.from_file('ls_spec.rb').code_type.should == :ruby
+      end
+
+      should 'find files that are relative to a directory in the $LOAD_PATH' do
+        Pry::Code.from_file('../helper.rb').code_type.should == :ruby
+      end
     end
   end