diff -r 0b4bff2b0ce3 -r 46e52bbb9b1a mercurial/ui.py
--- a/mercurial/ui.py	Sat Jul 15 17:00:23 2006 +0200
+++ b/mercurial/ui.py	Sun Jul 16 00:01:41 2006 +0200
@@ -209,7 +209,7 @@
 
     def expandpath(self, loc, default=None):
         """Return repository location relative to cwd or from [paths]"""
-        if "://" in loc or os.path.exists(loc):
+        if "://" in loc or os.path.isdir(loc):
             return loc
 
         path = self.config("paths", loc)