diff --git a/doc/changes/fixed/13712.md b/doc/changes/fixed/13712.md
new file mode 100644
index 00000000000..93d3eac1643
--- /dev/null
+++ b/doc/changes/fixed/13712.md
@@ -0,0 +1,3 @@
+- Fixed interpreting relative paths in `%{bin:..}` and `%{bin-available:..}`.
+  These are now interpreted correctly, relative to the dune file they're in.
+  (#13712, fixes #9564, @anmonteiro)
diff --git a/src/dune_rules/action_unexpanded.ml b/src/dune_rules/action_unexpanded.ml
index 090f5d30264..c87e1e99930 100644
--- a/src/dune_rules/action_unexpanded.ml
+++ b/src/dune_rules/action_unexpanded.ml
@@ -403,8 +403,9 @@ end = struct
                Action_builder.of_memo
                @@
                let open Memo.O in
+               let dir = env.dir in
                let* where =
-                 let+ project = Dune_load.find_project ~dir:env.dir in
+                 let+ project = Dune_load.find_project ~dir in
                  if Dune_project.dune_version project >= (3, 14)
                  then Artifacts.Original_path
                  else Install_dir
@@ -415,7 +416,7 @@ end = struct
                  | "rescript_syntax" -> Some "opam install rescript-syntax"
                  | _ -> None
                in
-               Artifacts.binary ?hint ~loc:(Some loc) ~where artifacts s)
+               Artifacts.binary ?hint ~loc:(Some loc) ~where ~dir artifacts s)
         in
         let args = Value.L.to_strings ~dir args in
         match prog with
diff --git a/src/dune_rules/artifacts.ml b/src/dune_rules/artifacts.ml
index ff2b37f82e7..1e81cdca46c 100644
--- a/src/dune_rules/artifacts.ml
+++ b/src/dune_rules/artifacts.ml
@@ -46,18 +46,23 @@ let local_binaries { local_bins; _ } =
     | _, Origin _origins -> None)
 ;;
 
-let analyze_binary t name =
+let analyze_binary t ~dir name =
   match Filename.is_relative name with
   | false -> Memo.return (`Resolved (Path.of_filename_relative_to_initial_cwd name))
   | true ->
     let* local_bins = Memo.Lazy.force t.local_bins in
+    let lookup_name =
+      match Filename.analyze_program_name name with
+      | Absolute | In_path -> name
+      | Relative_to_current_dir -> Path.Build.relative dir name |> Path.Build.basename
+    in
     let which () =
-      Context.which t.context name
+      Context.which t.context lookup_name
       >>| function
       | None -> `None
       | Some path -> `Resolved path
     in
-    (match Filename.Map.find local_bins name with
+    (match Filename.Map.find local_bins lookup_name with
      | Some (Resolved p) -> Memo.return (`Resolved (Path.build p.path))
      | None -> which ()
      | Some (Origin origins) ->
@@ -82,8 +87,8 @@ let analyze_binary t name =
             ]))
 ;;
 
-let binary t ?hint ?(where = Install_dir) ~loc name =
-  analyze_binary t name
+let binary t ?hint ?(where = Install_dir) ~dir ~loc name =
+  analyze_binary t ~dir name
   >>= function
   | `Resolved path -> Memo.return @@ Ok path
   | `None ->
@@ -107,8 +112,8 @@ let binary t ?hint ?(where = Install_dir) ~loc name =
        Ok (Path.build src))
 ;;
 
-let binary_available t name =
-  analyze_binary t name
+let binary_available t ~dir name =
+  analyze_binary t ~dir name
   >>| function
   | `None -> false
   | `Resolved _ | `Origin _ -> true
diff --git a/src/dune_rules/artifacts.mli b/src/dune_rules/artifacts.mli
index 5294fe419c3..5ca6d6e16ac 100644
--- a/src/dune_rules/artifacts.mli
+++ b/src/dune_rules/artifacts.mli
@@ -33,11 +33,12 @@ val binary
   :  t
   -> ?hint:string
   -> ?where:where
+  -> dir:Path.Build.t
   -> loc:Loc.t option
   -> Filename.t
   -> Action.Prog.t Memo.t
 
-val binary_available : t -> string -> bool Memo.t
+val binary_available : t -> dir:Path.Build.t -> string -> bool Memo.t
 val add_binaries : t -> dir:Path.Build.t -> File_binding.Expanded.t list -> t
 
 val create
diff --git a/src/dune_rules/coq/coq_config.ml b/src/dune_rules/coq/coq_config.ml
index 09f47566739..869881b118b 100644
--- a/src/dune_rules/coq/coq_config.ml
+++ b/src/dune_rules/coq/coq_config.ml
@@ -248,10 +248,12 @@ let by_name { coqlib; coqcorelib; coq_native_compiler_default } name =
       [ "name", Dyn.string name ]
 ;;
 
-let expand source macro artifacts_host =
+let expand source macro ~dir artifacts_host =
   let s = Pform.Macro_invocation.Args.whole macro in
   let open Memo.O in
-  let* coqc = Artifacts.binary artifacts_host ~where:Original_path ~loc:None "coqc" in
+  let* coqc =
+    Artifacts.binary artifacts_host ~where:Original_path ~dir ~loc:None "coqc"
+  in
   let expand m k s =
     let+ t = m ~coqc in
     match t with
diff --git a/src/dune_rules/coq/coq_config.mli b/src/dune_rules/coq/coq_config.mli
index 8f9c848fef3..c59eb7f5fa0 100644
--- a/src/dune_rules/coq/coq_config.mli
+++ b/src/dune_rules/coq/coq_config.mli
@@ -65,5 +65,6 @@ val by_name : t -> string -> Value.t Option.t
 val expand
   :  Dune_lang.Template.Pform.t
   -> Pform.Macro_invocation.t
+  -> dir:Path.Build.t
   -> Artifacts.t
   -> Dune_lang.Value.t list Memo.t
diff --git a/src/dune_rules/expander.ml b/src/dune_rules/expander.ml
index 0d78c2c159d..3fb255fe33d 100644
--- a/src/dune_rules/expander.ml
+++ b/src/dune_rules/expander.ml
@@ -664,6 +664,7 @@ let expand_pform_macro
                 let* artifacts_host = t.artifacts_host in
                 Artifacts.binary
                   ~loc:(Some (Dune_lang.Template.Pform.loc source))
+                  ~dir:t.dir
                   artifacts_host
                   s)
            in
@@ -692,7 +693,7 @@ let expand_pform_macro
         Without
           (let open Memo.O in
            let* artifacts_host = t.artifacts_host in
-           let+ b = Artifacts.binary_available artifacts_host s in
+           let+ b = Artifacts.binary_available artifacts_host ~dir:t.dir s in
            b |> string_of_bool |> string))
   | File_available ->
     Direct
@@ -723,7 +724,7 @@ let expand_pform_macro
         Without
           (let open Memo.O in
            let* artifacts_host = t.artifacts_host in
-           Coq_config.expand source macro_invocation artifacts_host))
+           Coq_config.expand source macro_invocation ~dir:t.dir artifacts_host))
   | Ppx ->
     Need_full_expander
       (fun t ->
@@ -747,7 +748,7 @@ let expand_pform_macro
         Without
           (let open Memo.O in
            let* artifacts_host = t.artifacts_host in
-           Rocq_config.expand source macro_invocation artifacts_host))
+           Rocq_config.expand source macro_invocation ~dir:t.dir artifacts_host))
 ;;
 
 let expand_pform_gen ~(context : Context.t) ~bindings ~dir ~source (pform : Pform.t)
diff --git a/src/dune_rules/rocq/rocq_config.ml b/src/dune_rules/rocq/rocq_config.ml
index a7a209081ff..12b7e2b9788 100644
--- a/src/dune_rules/rocq/rocq_config.ml
+++ b/src/dune_rules/rocq/rocq_config.ml
@@ -257,10 +257,12 @@ let by_name { rocqlib; rocq_native_compiler_default } name =
       [ "name", Dyn.string name ]
 ;;
 
-let expand source macro artifacts_host =
+let expand source macro ~dir artifacts_host =
   let s = Pform.Macro_invocation.Args.whole macro in
   let open Memo.O in
-  let* rocq = Artifacts.binary artifacts_host ~where:Original_path ~loc:None "rocq" in
+  let* rocq =
+    Artifacts.binary artifacts_host ~where:Original_path ~dir ~loc:None "rocq"
+  in
   let expand m k s =
     let+ t = m ~rocq in
     match t with
diff --git a/src/dune_rules/rocq/rocq_config.mli b/src/dune_rules/rocq/rocq_config.mli
index 66e0ecdb6ab..a1935a1328c 100644
--- a/src/dune_rules/rocq/rocq_config.mli
+++ b/src/dune_rules/rocq/rocq_config.mli
@@ -77,5 +77,6 @@ val by_name : t -> string -> Value.t Option.t
 val expand
   :  Dune_lang.Template.Pform.t
   -> Pform.Macro_invocation.t
+  -> dir:Path.Build.t
   -> Artifacts.t
   -> Dune_lang.Value.t list Memo.t
diff --git a/src/dune_rules/super_context.ml b/src/dune_rules/super_context.ml
index 1b0ba0d381c..08ad63d3ae1 100644
--- a/src/dune_rules/super_context.ml
+++ b/src/dune_rules/super_context.ml
@@ -181,7 +181,7 @@ let add_alias_action t alias ~dir ~loc action =
 
 let resolve_program_memo t ~dir ?where ?hint ~loc bin =
   let* artifacts = artifacts_host t ~dir in
-  Artifacts.binary ?hint ?where ~loc artifacts bin
+  Artifacts.binary ?hint ?where ~dir ~loc artifacts bin
 ;;
 
 let resolve_program t ~dir ?where ?hint ~loc bin =
diff --git a/test/blackbox-tests/test-cases/bin-available-relative.t b/test/blackbox-tests/test-cases/bin-available-relative.t
new file mode 100644
index 00000000000..2b16a9b69c2
--- /dev/null
+++ b/test/blackbox-tests/test-cases/bin-available-relative.t
@@ -0,0 +1,71 @@
+Relative paths in %{bin:...} and %{bin-available:...} are resolved from the
+current directory. See #9564.
+
+  $ cat > dune-project << EOF
+  > (lang dune 3.10)
+  > 
+  > (package
+  >  (name p))
+  > EOF
+
+  $ cat > dune << EOF
+  > (executable
+  >  (public_name e)
+  >  (package p))
+  > 
+  > (executable
+  >  (public_name disabled)
+  >  (package p)
+  >  (modules disabled)
+  >  (enabled_if false))
+  > 
+  > (rule
+  >  (alias all)
+  >  (action
+  >   (progn
+  >    (echo "available e: %{bin-available:./e}\n")
+  >    (echo "available root foo: %{bin-available:./foo}\n")
+  >    (echo "available pathonly: %{bin-available:./pathonly}\n")
+  >    (echo "available dironly: %{bin-available:./dironly}\n")
+  >    (echo "available disabled: %{bin-available:./disabled}\n")
+  >    (run %{bin:./pathonly})
+  >    (run %{bin:./e}))))
+  > EOF
+  $ mkdir path-bin
+  $ cat > path-bin/pathonly << EOF
+  > #!/bin/sh
+  > echo "running pathonly"
+  > EOF
+  $ chmod +x path-bin/pathonly
+  $ mkdir dironly
+  $ export PATH=$PWD:$PWD/path-bin:$PATH
+  $ mkdir sub
+  $ cat > sub/dune << EOF
+  > (executable
+  >  (public_name nested)
+  >  (package p)
+  >  (modules nested))
+  > 
+  > (env
+  >  (_ (binaries (nested.exe as foo))))
+  > 
+  > (rule
+  >  (alias all)
+  >  (action
+  >   (echo "available nested foo: %{bin-available:./foo}\n")))
+  > EOF
+  $ cat > e.ml << EOF
+  > let () = print_endline "running e"
+  > EOF
+  $ touch sub/nested.ml
+  $ touch disabled.ml
+
+  $ dune build @all
+  available nested foo: true
+  available e: true
+  available root foo: false
+  available pathonly: true
+  available dironly: false
+  available disabled: false
+  running pathonly
+  running e
diff --git a/test/blackbox-tests/test-cases/bin-available.t b/test/blackbox-tests/test-cases/bin-available.t
index 286d61562e6..c70c7b8e09d 100644
--- a/test/blackbox-tests/test-cases/bin-available.t
+++ b/test/blackbox-tests/test-cases/bin-available.t
@@ -35,7 +35,7 @@ Test for %{bin-available:...}
   dune: true
   local program foo: true
   non existent program: false
-  local path foo: false
+  local path foo: true
   local path bar: false
   disabled binary is available: false
   disabled by enabled_if: false