diff --git a/railties/lib/rails/generators/base.rb b/railties/lib/rails/generators/base.rb
index 7af99797ea..e6baf2fc79 100644
--- a/railties/lib/rails/generators/base.rb
+++ b/railties/lib/rails/generators/base.rb
@@ -12,6 +12,16 @@ module Rails
 
       add_runtime_options!
 
+      # Always move to rails source root.
+      #
+      def initialize(*args) #:nodoc:
+        if !invoked?(args) && defined?(Rails.root) && Rails.root
+          self.destination_root = Rails.root
+          FileUtils.cd(destination_root)
+        end
+        super
+      end
+
       # Automatically sets the source root based on the class name.
       #
       def self.source_root
@@ -247,6 +257,13 @@ module Rails
           end
         end
 
+        # Check if this generator was invoked from another one by inspecting
+        # parameters.
+        #
+        def invoked?(args)
+          args.last.is_a?(Hash) && args.last.key?(:invocations)
+        end
+
         # Use Rails default banner.
         #
         def self.banner
diff --git a/railties/test/generators/generators_test_helper.rb b/railties/test/generators/generators_test_helper.rb
index ccf08c347c..fdf6b4041f 100644
--- a/railties/test/generators/generators_test_helper.rb
+++ b/railties/test/generators/generators_test_helper.rb
@@ -1,8 +1,14 @@
 # TODO: Fix this RAILS_ENV stuff
-RAILS_ENV = 'test'
-
+RAILS_ENV = 'test' unless defined?(RAILS_ENV)
 require 'abstract_unit'
-Rails.application.config.root = File.expand_path(File.join(File.dirname(__FILE__), '..', 'fixtures'))
+
+module Rails
+  def self.root
+    @root ||= File.expand_path(File.join(File.dirname(__FILE__), '..', 'fixtures'))
+  end
+end
+Rails.application.config.root = Rails.root
+
 require 'rails/generators'
 require 'rubygems'
 require 'active_record'
@@ -15,8 +21,7 @@ class GeneratorsTestCase < Test::Unit::TestCase
   include FileUtils
 
   def destination_root
-    @destination_root ||= File.expand_path(File.join(File.dirname(__FILE__),
-                                            '..', 'fixtures', 'tmp'))
+    File.join(Rails.root, "tmp")
   end
 
   def setup
diff --git a/railties/test/generators_test.rb b/railties/test/generators_test.rb
index 178b5ef6de..8f1984c7d2 100644
--- a/railties/test/generators_test.rb
+++ b/railties/test/generators_test.rb
@@ -105,7 +105,7 @@ class GeneratorsTest < GeneratorsTestCase
   end
 
   def test_warning_is_shown_if_generator_cant_be_loaded
-    Rails::Generators.load_paths << File.expand_path("../fixtures/vendor/gems/gems/wrong", __FILE__)
+    Rails::Generators.load_paths << File.join(Rails.root, "vendor", "gems", "gems", "wrong")
     output = capture(:stderr){ Rails::Generators.find_by_namespace(:wrong) }
     assert_match /\[WARNING\] Could not load generator at/, output
     assert_match /Error: uninitialized constant Rails::Generator/, output