diff --git a/ci/release/changelogs/next.md b/ci/release/changelogs/next.md
index 2e8a3375d..2543ebe96 100644
--- a/ci/release/changelogs/next.md
+++ b/ci/release/changelogs/next.md
@@ -1,3 +1,7 @@
-Hotfix for 0.6.4 breaking plugins, along with 2 other compiler bugfixes.
+#### Features 🚀
+
+#### Improvements 🧹
 
 #### Bugfixes ⛑️
+
+- Local relative icons are relative to the d2 file instead of CLI invoke path [#1924](https://github.com/terrastruct/d2/pull/1924)
diff --git a/d2cli/main.go b/d2cli/main.go
index 93a103db9..e0708b8fd 100644
--- a/d2cli/main.go
+++ b/d2cli/main.go
@@ -529,7 +529,7 @@ func compile(ctx context.Context, ms *xmain.State, plugins []d2plugin.Plugin, fs
 	ext := getExportExtension(outputPath)
 	switch ext {
 	case GIF:
-		svg, pngs, err := renderPNGsForGIF(ctx, ms, plugin, renderOpts, ruler, page, diagram)
+		svg, pngs, err := renderPNGsForGIF(ctx, ms, plugin, renderOpts, ruler, page, inputPath, diagram)
 		if err != nil {
 			return nil, false, err
 		}
@@ -553,7 +553,7 @@ func compile(ctx context.Context, ms *xmain.State, plugins []d2plugin.Plugin, fs
 		path := []pdf.BoardTitle{
 			{Name: diagram.Root.Label, BoardID: "root"},
 		}
-		pdf, err := renderPDF(ctx, ms, plugin, renderOpts, outputPath, page, ruler, diagram, nil, path, pageMap, diagram.Root.Label != "")
+		pdf, err := renderPDF(ctx, ms, plugin, renderOpts, inputPath, outputPath, page, ruler, diagram, nil, path, pageMap, diagram.Root.Label != "")
 		if err != nil {
 			return pdf, false, err
 		}
@@ -574,7 +574,7 @@ func compile(ctx context.Context, ms *xmain.State, plugins []d2plugin.Plugin, fs
 		path := []pptx.BoardTitle{
 			{Name: "root", BoardID: "root", LinkToSlide: boardIdToIndex["root"] + 1},
 		}
-		svg, err := renderPPTX(ctx, ms, p, plugin, renderOpts, ruler, outputPath, page, diagram, path, boardIdToIndex)
+		svg, err := renderPPTX(ctx, ms, p, plugin, renderOpts, ruler, inputPath, outputPath, page, diagram, path, boardIdToIndex)
 		if err != nil {
 			return nil, false, err
 		}
@@ -808,7 +808,7 @@ func render(ctx context.Context, ms *xmain.State, compileDur time.Duration, plug
 
 	if !diagram.IsFolderOnly {
 		start := time.Now()
-		out, err := _render(ctx, ms, plugin, opts, boardOutputPath, bundle, forceAppendix, page, ruler, diagram)
+		out, err := _render(ctx, ms, plugin, opts, inputPath, boardOutputPath, bundle, forceAppendix, page, ruler, diagram)
 		if err != nil {
 			return boards, err
 		}
@@ -824,7 +824,7 @@ func render(ctx context.Context, ms *xmain.State, compileDur time.Duration, plug
 
 func renderSingle(ctx context.Context, ms *xmain.State, compileDur time.Duration, plugin d2plugin.Plugin, opts d2svg.RenderOpts, inputPath, outputPath string, bundle, forceAppendix bool, page playwright.Page, ruler *textmeasure.Ruler, diagram *d2target.Diagram) ([][]byte, error) {
 	start := time.Now()
-	out, err := _render(ctx, ms, plugin, opts, outputPath, bundle, forceAppendix, page, ruler, diagram)
+	out, err := _render(ctx, ms, plugin, opts, inputPath, outputPath, bundle, forceAppendix, page, ruler, diagram)
 	if err != nil {
 		return [][]byte{}, err
 	}
@@ -835,7 +835,7 @@ func renderSingle(ctx context.Context, ms *xmain.State, compileDur time.Duration
 	return [][]byte{out}, nil
 }
 
-func _render(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opts d2svg.RenderOpts, outputPath string, bundle, forceAppendix bool, page playwright.Page, ruler *textmeasure.Ruler, diagram *d2target.Diagram) ([]byte, error) {
+func _render(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opts d2svg.RenderOpts, inputPath, outputPath string, bundle, forceAppendix bool, page playwright.Page, ruler *textmeasure.Ruler, diagram *d2target.Diagram) ([]byte, error) {
 	toPNG := getExportExtension(outputPath) == PNG
 	var scale *float64
 	if opts.Scale != nil {
@@ -865,7 +865,7 @@ func _render(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opts
 
 	cacheImages := ms.Env.Getenv("IMG_CACHE") == "1"
 	l := simplelog.FromCmdLog(ms.Log)
-	svg, bundleErr := imgbundler.BundleLocal(ctx, l, svg, cacheImages)
+	svg, bundleErr := imgbundler.BundleLocal(ctx, l, inputPath, svg, cacheImages)
 	if bundle {
 		var bundleErr2 error
 		svg, bundleErr2 = imgbundler.BundleRemote(ctx, l, svg, cacheImages)
@@ -915,7 +915,7 @@ func _render(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opts
 	return svg, nil
 }
 
-func renderPDF(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opts d2svg.RenderOpts, outputPath string, page playwright.Page, ruler *textmeasure.Ruler, diagram *d2target.Diagram, doc *pdf.GoFPDF, boardPath []pdf.BoardTitle, pageMap map[string]int, includeNav bool) (svg []byte, err error) {
+func renderPDF(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opts d2svg.RenderOpts, inputPath, outputPath string, page playwright.Page, ruler *textmeasure.Ruler, diagram *d2target.Diagram, doc *pdf.GoFPDF, boardPath []pdf.BoardTitle, pageMap map[string]int, includeNav bool) (svg []byte, err error) {
 	var isRoot bool
 	if doc == nil {
 		doc = pdf.Init()
@@ -953,7 +953,7 @@ func renderPDF(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opt
 
 		cacheImages := ms.Env.Getenv("IMG_CACHE") == "1"
 		l := simplelog.FromCmdLog(ms.Log)
-		svg, bundleErr := imgbundler.BundleLocal(ctx, l, svg, cacheImages)
+		svg, bundleErr := imgbundler.BundleLocal(ctx, l, inputPath, svg, cacheImages)
 		svg, bundleErr2 := imgbundler.BundleRemote(ctx, l, svg, cacheImages)
 		bundleErr = multierr.Combine(bundleErr, bundleErr2)
 		if bundleErr != nil {
@@ -986,7 +986,7 @@ func renderPDF(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opt
 			Name:    dl.Root.Label,
 			BoardID: strings.Join([]string{boardPath[len(boardPath)-1].BoardID, LAYERS, dl.Name}, "."),
 		})
-		_, err := renderPDF(ctx, ms, plugin, opts, "", page, ruler, dl, doc, path, pageMap, includeNav)
+		_, err := renderPDF(ctx, ms, plugin, opts, inputPath, "", page, ruler, dl, doc, path, pageMap, includeNav)
 		if err != nil {
 			return nil, err
 		}
@@ -996,7 +996,7 @@ func renderPDF(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opt
 			Name:    dl.Root.Label,
 			BoardID: strings.Join([]string{boardPath[len(boardPath)-1].BoardID, SCENARIOS, dl.Name}, "."),
 		})
-		_, err := renderPDF(ctx, ms, plugin, opts, "", page, ruler, dl, doc, path, pageMap, includeNav)
+		_, err := renderPDF(ctx, ms, plugin, opts, inputPath, "", page, ruler, dl, doc, path, pageMap, includeNav)
 		if err != nil {
 			return nil, err
 		}
@@ -1006,7 +1006,7 @@ func renderPDF(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opt
 			Name:    dl.Root.Label,
 			BoardID: strings.Join([]string{boardPath[len(boardPath)-1].BoardID, STEPS, dl.Name}, "."),
 		})
-		_, err := renderPDF(ctx, ms, plugin, opts, "", page, ruler, dl, doc, path, pageMap, includeNav)
+		_, err := renderPDF(ctx, ms, plugin, opts, inputPath, "", page, ruler, dl, doc, path, pageMap, includeNav)
 		if err != nil {
 			return nil, err
 		}
@@ -1022,7 +1022,7 @@ func renderPDF(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opt
 	return svg, nil
 }
 
-func renderPPTX(ctx context.Context, ms *xmain.State, presentation *pptx.Presentation, plugin d2plugin.Plugin, opts d2svg.RenderOpts, ruler *textmeasure.Ruler, outputPath string, page playwright.Page, diagram *d2target.Diagram, boardPath []pptx.BoardTitle, boardIDToIndex map[string]int) ([]byte, error) {
+func renderPPTX(ctx context.Context, ms *xmain.State, presentation *pptx.Presentation, plugin d2plugin.Plugin, opts d2svg.RenderOpts, ruler *textmeasure.Ruler, inputPath, outputPath string, page playwright.Page, diagram *d2target.Diagram, boardPath []pptx.BoardTitle, boardIDToIndex map[string]int) ([]byte, error) {
 	var svg []byte
 	if !diagram.IsFolderOnly {
 		// gofpdf will print the png img with a slight filter
@@ -1055,7 +1055,7 @@ func renderPPTX(ctx context.Context, ms *xmain.State, presentation *pptx.Present
 
 		cacheImages := ms.Env.Getenv("IMG_CACHE") == "1"
 		l := simplelog.FromCmdLog(ms.Log)
-		svg, bundleErr := imgbundler.BundleLocal(ctx, l, svg, cacheImages)
+		svg, bundleErr := imgbundler.BundleLocal(ctx, l, inputPath, svg, cacheImages)
 		svg, bundleErr2 := imgbundler.BundleRemote(ctx, l, svg, cacheImages)
 		bundleErr = multierr.Combine(bundleErr, bundleErr2)
 		if bundleErr != nil {
@@ -1120,7 +1120,7 @@ func renderPPTX(ctx context.Context, ms *xmain.State, presentation *pptx.Present
 			BoardID:     boardID,
 			LinkToSlide: boardIDToIndex[boardID] + 1,
 		})
-		_, err := renderPPTX(ctx, ms, presentation, plugin, opts, ruler, "", page, dl, path, boardIDToIndex)
+		_, err := renderPPTX(ctx, ms, presentation, plugin, opts, ruler, inputPath, "", page, dl, path, boardIDToIndex)
 		if err != nil {
 			return nil, err
 		}
@@ -1132,7 +1132,7 @@ func renderPPTX(ctx context.Context, ms *xmain.State, presentation *pptx.Present
 			BoardID:     boardID,
 			LinkToSlide: boardIDToIndex[boardID] + 1,
 		})
-		_, err := renderPPTX(ctx, ms, presentation, plugin, opts, ruler, "", page, dl, path, boardIDToIndex)
+		_, err := renderPPTX(ctx, ms, presentation, plugin, opts, ruler, inputPath, "", page, dl, path, boardIDToIndex)
 		if err != nil {
 			return nil, err
 		}
@@ -1144,7 +1144,7 @@ func renderPPTX(ctx context.Context, ms *xmain.State, presentation *pptx.Present
 			BoardID:     boardID,
 			LinkToSlide: boardIDToIndex[boardID] + 1,
 		})
-		_, err := renderPPTX(ctx, ms, presentation, plugin, opts, ruler, "", page, dl, path, boardIDToIndex)
+		_, err := renderPPTX(ctx, ms, presentation, plugin, opts, ruler, inputPath, "", page, dl, path, boardIDToIndex)
 		if err != nil {
 			return nil, err
 		}
@@ -1276,7 +1276,7 @@ func buildBoardIDToIndex(diagram *d2target.Diagram, dictionary map[string]int, p
 	return dictionary
 }
 
-func renderPNGsForGIF(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opts d2svg.RenderOpts, ruler *textmeasure.Ruler, page playwright.Page, diagram *d2target.Diagram) (svg []byte, pngs [][]byte, err error) {
+func renderPNGsForGIF(ctx context.Context, ms *xmain.State, plugin d2plugin.Plugin, opts d2svg.RenderOpts, ruler *textmeasure.Ruler, page playwright.Page, inputPath string, diagram *d2target.Diagram) (svg []byte, pngs [][]byte, err error) {
 	if !diagram.IsFolderOnly {
 
 		var scale *float64
@@ -1302,7 +1302,7 @@ func renderPNGsForGIF(ctx context.Context, ms *xmain.State, plugin d2plugin.Plug
 
 		cacheImages := ms.Env.Getenv("IMG_CACHE") == "1"
 		l := simplelog.FromCmdLog(ms.Log)
-		svg, bundleErr := imgbundler.BundleLocal(ctx, l, svg, cacheImages)
+		svg, bundleErr := imgbundler.BundleLocal(ctx, l, inputPath, svg, cacheImages)
 		svg, bundleErr2 := imgbundler.BundleRemote(ctx, l, svg, cacheImages)
 		bundleErr = multierr.Combine(bundleErr, bundleErr2)
 		if bundleErr != nil {
@@ -1319,21 +1319,21 @@ func renderPNGsForGIF(ctx context.Context, ms *xmain.State, plugin d2plugin.Plug
 	}
 
 	for _, dl := range diagram.Layers {
-		_, layerPNGs, err := renderPNGsForGIF(ctx, ms, plugin, opts, ruler, page, dl)
+		_, layerPNGs, err := renderPNGsForGIF(ctx, ms, plugin, opts, ruler, page, inputPath, dl)
 		if err != nil {
 			return nil, nil, err
 		}
 		pngs = append(pngs, layerPNGs...)
 	}
 	for _, dl := range diagram.Scenarios {
-		_, scenarioPNGs, err := renderPNGsForGIF(ctx, ms, plugin, opts, ruler, page, dl)
+		_, scenarioPNGs, err := renderPNGsForGIF(ctx, ms, plugin, opts, ruler, page, inputPath, dl)
 		if err != nil {
 			return nil, nil, err
 		}
 		pngs = append(pngs, scenarioPNGs...)
 	}
 	for _, dl := range diagram.Steps {
-		_, stepsPNGs, err := renderPNGsForGIF(ctx, ms, plugin, opts, ruler, page, dl)
+		_, stepsPNGs, err := renderPNGsForGIF(ctx, ms, plugin, opts, ruler, page, inputPath, dl)
 		if err != nil {
 			return nil, nil, err
 		}
diff --git a/lib/imgbundler/imgbundler.go b/lib/imgbundler/imgbundler.go
index 08488df10..908b93b57 100644
--- a/lib/imgbundler/imgbundler.go
+++ b/lib/imgbundler/imgbundler.go
@@ -12,6 +12,7 @@ import (
 	"net/url"
 	"os"
 	"path"
+	"path/filepath"
 	"regexp"
 	"strings"
 	"sync"
@@ -29,12 +30,12 @@ const maxImageSize int64 = 1 << 25 // 33_554_432
 
 var imageRegex = regexp.MustCompile(`<image href="([^"]+)"`)
 
-func BundleLocal(ctx context.Context, l simplelog.Logger, in []byte, cacheImages bool) ([]byte, error) {
-	return bundle(ctx, l, in, false, cacheImages)
+func BundleLocal(ctx context.Context, l simplelog.Logger, inputPath string, in []byte, cacheImages bool) ([]byte, error) {
+	return bundle(ctx, l, inputPath, in, false, cacheImages)
 }
 
 func BundleRemote(ctx context.Context, l simplelog.Logger, in []byte, cacheImages bool) ([]byte, error) {
-	return bundle(ctx, l, in, true, cacheImages)
+	return bundle(ctx, l, "", in, true, cacheImages)
 }
 
 type repl struct {
@@ -42,7 +43,7 @@ type repl struct {
 	to   []byte
 }
 
-func bundle(ctx context.Context, l simplelog.Logger, svg []byte, isRemote, cacheImages bool) (_ []byte, err error) {
+func bundle(ctx context.Context, l simplelog.Logger, inputPath string, svg []byte, isRemote, cacheImages bool) (_ []byte, err error) {
 	if isRemote {
 		defer xdefer.Errorf(&err, "failed to bundle remote images")
 	} else {
@@ -54,7 +55,7 @@ func bundle(ctx context.Context, l simplelog.Logger, svg []byte, isRemote, cache
 	ctx, cancel := context.WithTimeout(ctx, time.Minute*5)
 	defer cancel()
 
-	return runWorkers(ctx, l, svg, imgs, isRemote, cacheImages)
+	return runWorkers(ctx, l, inputPath, svg, imgs, isRemote, cacheImages)
 }
 
 // filterImageElements finds all unique image elements in imgs that are
@@ -84,7 +85,7 @@ func filterImageElements(imgs [][][]byte, isRemote bool) [][][]byte {
 	return imgs2
 }
 
-func runWorkers(ctx context.Context, l simplelog.Logger, svg []byte, imgs [][][]byte, isRemote, cacheImages bool) (_ []byte, err error) {
+func runWorkers(ctx context.Context, l simplelog.Logger, inputPath string, svg []byte, imgs [][][]byte, isRemote, cacheImages bool) (_ []byte, err error) {
 	var wg sync.WaitGroup
 	replc := make(chan repl)
 
@@ -111,7 +112,7 @@ func runWorkers(ctx context.Context, l simplelog.Logger, svg []byte, imgs [][][]
 					<-sema
 				}()
 
-				bundledImage, err := worker(ctx, l, img[1], isRemote, cacheImages)
+				bundledImage, err := worker(ctx, l, inputPath, img[1], isRemote, cacheImages)
 				if err != nil {
 					l.Error(fmt.Sprintf("failed to bundle %s: %v", img[1], err))
 					errhrefsMu.Lock()
@@ -150,7 +151,7 @@ func runWorkers(ctx context.Context, l simplelog.Logger, svg []byte, imgs [][][]
 	}
 }
 
-func worker(ctx context.Context, l simplelog.Logger, href []byte, isRemote, cacheImages bool) ([]byte, error) {
+func worker(ctx context.Context, l simplelog.Logger, inputPath string, href []byte, isRemote, cacheImages bool) ([]byte, error) {
 	if cacheImages {
 		if hit, ok := imgCache.Load(string(href)); ok {
 			return hit.([]byte), nil
@@ -164,7 +165,11 @@ func worker(ctx context.Context, l simplelog.Logger, href []byte, isRemote, cach
 		buf, mimeType, err = httpGet(ctx, html.UnescapeString(string(href)))
 	} else {
 		l.Debug(fmt.Sprintf("reading %s from disk", string(href)))
-		buf, err = os.ReadFile(html.UnescapeString(string(href)))
+		path := html.UnescapeString(string(href))
+		if inputPath != "-" && !filepath.IsAbs(path) {
+			path = filepath.Join(filepath.Dir(inputPath), path)
+		}
+		buf, err = os.ReadFile(path)
 	}
 	if err != nil {
 		return nil, err