diff --git a/Makefile.PL b/Makefile.PL
index a838921..2ab0438 100644
--- a/Makefile.PL
+++ b/Makefile.PL
@@ -7,5 +7,6 @@ WriteMakefile(
         'DBI'           => 0,
         'DBD::SQLite'   => 0,
         'Term::ReadLine' => 0,
+        'Cwd'           => 0,
     },
 );
diff --git a/lib/pshell_history.db b/lib/pshell_history.db
new file mode 100644
index 0000000..e69de29
diff --git a/pshell.pl b/pshell.pl
index 61c61fd..8d91546 100755
--- a/pshell.pl
+++ b/pshell.pl
@@ -3,6 +3,7 @@
 use lib 'lib';
 use History::SQLite;
 use Term::ReadLine;
+use Cwd;
 
 # Initialize command history
 my $history = History::SQLite->new(
@@ -19,7 +20,8 @@ my @history = $history->get_all;
 $term->addhistory($_) for @history;
 
 while (1) {
-    my $prompt = "pshell> ";
+    my $cwd = getcwd();
+    my $prompt = "pshell:$cwd> ";
     my $command = $term->readline($prompt);
     
     last unless defined $command;
@@ -29,6 +31,13 @@ while (1) {
     # Skip empty commands
     next unless length $command;
     
+    # Handle cd command specially
+    if ($command =~ /^cd\s*(.*)/) {
+        my $dir = $1 || $ENV{HOME};
+        chdir $dir or warn "Could not change to directory $dir: $!";
+        next;
+    }
+    
     # Save command to history
     $history->add($command);
     $term->addhistory($command);
diff --git a/pshell_history.db b/pshell_history.db
index a24003c..de1059c 100644
Binary files a/pshell_history.db and b/pshell_history.db differ