diff --git a/core/string/ustring.cpp b/core/string/ustring.cpp
index 3d37e17ef83..2edc5454f7d 100644
--- a/core/string/ustring.cpp
+++ b/core/string/ustring.cpp
@@ -4384,10 +4384,7 @@ String String::simplify_path() const {
 			dirs.remove_at(i);
 			i--;
 		} else if (d == "..") {
-			if (i == 0) {
-				dirs.remove_at(i);
-				i--;
-			} else {
+			if (i != 0) {
 				dirs.remove_at(i);
 				dirs.remove_at(i - 1);
 				i -= 2;
diff --git a/tests/core/config/test_project_settings.h b/tests/core/config/test_project_settings.h
index 8fc2489f8b4..0e1058a6266 100644
--- a/tests/core/config/test_project_settings.h
+++ b/tests/core/config/test_project_settings.h
@@ -126,10 +126,9 @@ TEST_CASE("[ProjectSettings] localize_path") {
 	CHECK_EQ(ProjectSettings::get_singleton()->localize_path("path\\.\\filename"), "res://path/filename");
 #endif
 
-	// FIXME?: These checks pass, but that doesn't seems correct
-	CHECK_EQ(ProjectSettings::get_singleton()->localize_path("../filename"), "res://filename");
-	CHECK_EQ(ProjectSettings::get_singleton()->localize_path("../path/filename"), "res://path/filename");
-	CHECK_EQ(ProjectSettings::get_singleton()->localize_path("..\\path\\filename"), "res://path/filename");
+	CHECK_EQ(ProjectSettings::get_singleton()->localize_path("../filename"), "../filename");
+	CHECK_EQ(ProjectSettings::get_singleton()->localize_path("../path/filename"), "../path/filename");
+	CHECK_EQ(ProjectSettings::get_singleton()->localize_path("..\\path\\filename"), "../path/filename");
 
 	CHECK_EQ(ProjectSettings::get_singleton()->localize_path("/testroot/filename"), "/testroot/filename");
 	CHECK_EQ(ProjectSettings::get_singleton()->localize_path("/testroot/path/filename"), "/testroot/path/filename");
diff --git a/tests/core/string/test_string.h b/tests/core/string/test_string.h
index cf57183a025..1b27966da18 100644
--- a/tests/core/string/test_string.h
+++ b/tests/core/string/test_string.h
@@ -1594,7 +1594,7 @@ TEST_CASE("[String] Path functions") {
 	static const char *base_name[8] = { "C:\\Godot\\project\\test", "/Godot/project/test", "../Godot/project/test", "Godot\\test", "C:\\test", "res://test", "user://test", "/" };
 	static const char *ext[8] = { "tscn", "xscn", "scn", "doc", "", "", "", "test" };
 	static const char *file[8] = { "test.tscn", "test.xscn", "test.scn", "test.doc", "test.", "test", "test", ".test" };
-	static const char *simplified[8] = { "C:/Godot/project/test.tscn", "/Godot/project/test.xscn", "Godot/project/test.scn", "Godot/test.doc", "C:/test.", "res://test", "user://test", "/.test" };
+	static const char *simplified[8] = { "C:/Godot/project/test.tscn", "/Godot/project/test.xscn", "../Godot/project/test.scn", "Godot/test.doc", "C:/test.", "res://test", "user://test", "/.test" };
 	static const bool abs[8] = { true, true, false, false, true, true, true, true };
 
 	for (int i = 0; i < 8; i++) {